the bottom up 49%. >> the argument is health care and education cost so much more. while you can live better in poverty if you will it's harder. >> case-shiller, we have to go. you get the last word. join us tomorrow. "squawk on the street" is next. ♪ good tuesday morning. welcome to "squawk on the street." hope you had a great, long weekend. i'm carl quintanilla with jim cramer, david faber at the new york stock exchange. we kick off this last week of may, the beginning of summer, with s&p case-shiller home prices at the bottom of your screen. we'll talk to robert shiller in a few minutes. meantime futures playing catch-up as europe had a nice day yesterday. plenty of m&a news. ten yield yielding 2.54, durable goods above consensus, march revised up as well. the dax hit the record high on

monday and mild upside in the markets this morning. our road map with market highs, record close for the s&p, futures pointing to that higher open. case-shiller the data point today. >> how the sausage gets made, deals lost and launched. the latest, pilgrim's pride unveils a $6.4 billion offer for hillshire brands. >> and rosie the robot meet mac the computer. apple set to unveil jetson-like software for a smarter home. your iphone coming soon as a remote control for your life. but first up, futures on the rise as each of the three major indices did enter the shortened trading week for the year. s&p set to open at an intraday high closing above the 1900 level on friday as the u.s. markets turned in their biggest weekly gain in over a month. after all the nashing of teeth this month, jim, dow and s&p are on track for four straight months of gains. we're hanging on by a thread. >> many people who came into

this month thinking the earnings weren't that good, a lot of fear built up, there were many sizable gurus with following saying listen, be very careful. dave tepper, a terrific guy, i think i've now parsed his words again, saying get off margin, somehow that became sell stocks. tepper wanted you to have fear which is never wrong after a very big run. but what's happened is that there was -- even though the vix didn't jump, there were a lot of people who said this market is not that good. in the interim you get a hillshire brands getting a bid and that's been a theme throughout may. >> m&a has certainly been important. we'll talk more about the specifics of that overbid, but it has added, it would seem to me, to the positive. >> yes. >> tone if you will. finally, and i've been saying it, m&a is back. there's no doubt about it. whether it's companies seeking an inversion or simply seeing value, or willing to actually

take more risk, it is back and that certainly redowns to the positive view of the market. >> it's amazing you've had the run with 17% of the s&p not participating at all which is the banks with china clearly not doing much at all and there's a lot of export companies with a very limited group of people, group of stocks taking the market up here but it's the transports. they look at fed ex, have you seen the rails here. these are commerce oriented. >> with the durable goods and also been a self-correcting mechanism. interest rates have come down. we're not talking about it enough. the home builders are saying it was a late spring but it is happening because mortgage rates are coming down. >> are you on alert for a breakout given that transports and teches have had to carry the water by themselves. >> a vacuum this year has meant positive, not negative. when you don't have a lot of earnings and you do -- i think that, you know, i think this year was summed up by

hewlett-packard. you have a 330 release by surprise. people look at the headlines and say hewlett-packard looks like it's not coming together. looks like the pcs aren't doing well. then meg whitman comes on our show, i did not see anything else that occurred, goes and tells a very positive story, convinces people you know what, it's not nearly as bad as you think, next thing you know you have the number one performer in the s&p 500. >> that was -- that was surprising in a way friday. i don't know -- >> reassuring. >> i don't know if people were misreading the afterhours movement which might have been based on small volume. i don't want to ascribe too much significance to our interview. the only thing out there. >> people were saying what happened, what went up? what occurred? and i go back over the interview and -- with david, correctly, i thought, tried to poke some holes in the story and the story was iron clad. layoffs, coupled with a little revenue growth is going to produce some pretty good leverage to the numbers, not as

bad as it used to be. other stories similarly. foot locker puts it to dick's and i thought that was important. you saw a kind of suggestion followed up by auto zone today that retail is not nearly as bad as you thought. i come back and say, when you have a couple of retailers telling a better story, let's use fresh market against whole foods, but it started to seem like last week was some retailers aren't getting it right, other retailers are getting it right. don't write off the consumer. mortga mortgage is coming down. consumer stronger. personal stuff for hewlett-packard was better. bring it together, best buy and gamestop weren't bad. >> let's move on to deals. >> sure. >> shall we? the biggest of which this morning another hostile or i'll call it that, they never do. >> pilgrim's pride offering to acquire hillshire brands for $45 a share in cash. just a couple weeks after hillshire agreed to buy pinnacle foods. that deal worth about $4.3

billion. i think that including debt. pfizer has withdrawn its multibillion oh, yeah, hundred plus billion offer to acquire astrazeneca. let's start off with the hillshire overbid if you will. >> yes. >> again not just deals but unsolicited deals are back. in the case of pfizer which we'll talk about in a minute, didn't quite work out that well. perhaps because they weren't willing to go hostile and didn't from the very beginning. obviously allergan/valeant still out there. this one now, they come over the top, $45 a share, hsh stock going to be up sharply, seem to be trading in the premarket around that $45 level. these two companies together would produce on a last 12 months $1.4 billion in ebitda, match up fairly well. they were there, that is, pilgrim's pride was there in february and came around and said would you guys be interested, hillshire, in doing a deal. would you be interested in

perhaps letting us acquire you. sitting down and negotiate. they were told no. they did not at that point, i am told, come with a price of any kind. they sat back, the question we don't have the answer to is, did hillshire move ahead with the pinnacle deal to avoid the clutches of pilgrim's pride or simply knowing they might be there to say well f they still are there, we might be able to get more out of them with this in hand because they do have section 5.4 of their merger agreement will allow them to contemplate the hillshire board, the exercise of its fiduciary duties a superior proposal essentially and a law pilgrim's pride to talk to management, negotiate do diligence and if the board believes is superior we really this deal not the deal that we were previously doing. >> this was important because if you remember the day it came down, hillshire stock was going up almost as much as pinnacle.

then there was a conference call where people felt very let down by hillshire which happens to have a rock solid balance sheet and cash position and a takeover candidate. jpmorgan downgrades them saying you know what, we expected more from hillshire. clearly jpmorgan had an inkling there must have been someone else. mr. gamgor, the ceo of pinnacle, i thought got the bum's rush. almost as if guys, this deal hell or high water is going to happen and i think it was one of the great defensive offerings by hillshire. i took away a niche company, the old sara lee, made it so it was an unwealding conglomerate with bird's eye and duncan heinz being the next level of growth. >> these guys are willing to pay the termination fee by the way. if you follow the scenario where they say it is superior and have to break the pinnacle deal, it would be $163 million. they're willing to pay it.

they come with a fairly strong case here. we'll see what the ultimate price may be if they do enter negotiations. obviously the shareholder vote is another way that they could win, so to speak, that being pilgrim's pride, they missed the annual meeting, but they are relying on the section 5.4. for pfizer real quickly, now it's all dead, mostly dead as they said last week. >> six months, right, for a new -- >> yes. >> unless they invite them which 90 days. >> three months if they invite them. astrazeneca perhaps getting some pressure from its shareholders. stepping back, the strategy employed by pfizer and its advisors has led to many questions. >> there was a strategy? >> there you go. >> what was the strategy? either you -- why not come hostile out of the gate? then you would be in conversation with astrazeneca shareholders which is the way it works under uk law. you might even have a deal by now. then the final back and forth which didn't include astrazeneca where they went to 55 pounds or

it seemed, but they only went 53 something in the press release. ga if them a day to own the news cycle. questions about pfizer strategy, none of which matter at this point. they said so long. >> all the stories about deals either not happening or might not happen, right? pfizer, ge, hillshire, allergan, is that the function of a regulator market or something different to it at this time? >> i mean each of them is their own scenario. france, for example, in the case -- >> right. >> and -- but i think it is more a case of a vibrant m&a market than it is anything else. we're starting to see deals of all types. obviously inversions continue to play a very important role here. not just for pfizer but in the case of valeant which already has that great tax rate and allergan perhaps not going to be able to find a white knight because they won't be able to find the same cost saving ability because they won't have an inversion, whoever might, but yes, in answer to your question it's more that. although it is interesting to

note, carl, each of the different issues. >> you know, i had dr. cook on friday, the ceo of isis. you asked me to look into the pipeline, the cancer pipeline of astrazeneca. it's largely isis pharmaceutical. i think that's interesting because isis is an american company -- >> on par -- >> the isis formula, which is an rna therapeutics, its novel i think is terrific for cancer. it's so interesting that they would rather -- pfizer hundred billion to get astrazeneca, but it is -- you're spending a fortune and really what i'm saying it really was decided by tax. because if it's the isis cancer product, you really wouldn't -- you could go buy isis and save a lot of money. but isis is located here. >> that's too bad. >> yeah. >> at least for now. >> too bad just a great country that has great scientists. i wish we had a tax rate. >> that's a great point, jim. when we come back, nobel

laureate robert shiller will break down the case-shiller home price number and offer his outlook on real estate. squawk alley 11:00 a.m. eastern, the reverend jesse jackson, why is he showing up at google and facebook shareholder meetings. he'll discuss his push for more diversity at technology companies out west. dow hanging on to a 25-point gain for the month. four sessions to go left in may. more "squawk on the street" live from post nine in a moment. nine.

let's get back to the key housing data. the latest s&p case-shiller number showing u.s. home prices rose slightly month over month. 19 of the 20 cities showed positive returns in march. on the cnbc news line is robert shiller, co-founder of the case-shiller index, nobel laureate and professor the economics at yale university. good to have you with us again this time i think from korea? >> yeah. i'm in seoul. >> good to have you. interesting report, you used the word substantial slowdowns in price gains. and the easy takeaway is that the housing market is losing momentum. how much of this is due to the fact that comps are getting tougher year over year. >> well, i don't know exactly

know why the numbers -- you know, it's not a big slowdown. the year over year is still up 12.4%. you know, i'm a little puzzled by it because -- but it isn't a big change. mortgage rates are down. and that ought to be spruring the market a little bit. but we don't see a big -- it's not a big change this month. the market is still on the up, at least looking at price data, you know, there's always been a lot of momentum in the housing market and it still looks up. and it still looks optimistic. >> every month we talk to you about these numbers, we talk about the dynamic of cash investors, people who are either investing for institutions in housing or paying cash for homes and then exiting the market later on. how much of that do you think is at play here? >> i think investors remain a very important force. one thing that was different,

you know, back in the early -- back in the boom years it was individuals buying their own homes or their own second homes that were driving things. that was a different psychology. that was a time i can't completely explain it, but now, the psychology has changed. homeowners seem to be losing interest, investors, at least until recently, have been very excited by the upward momentum. they seem to have learned about momentum. >> robert, it's very interesting to see that new york city was the only city to decline. i know that new york prices had really skyrocketed. are we starting to see resistance literally on price in new york city? >> it sounds that way, but it isn't only new york that declined seasonally adjusted basis. a couple other cities. >> right. dallas and denver. last week, frank light, the co of home depot, was talking about

how -- that rates went up so fast that maybe the real issue with interest rates they never should have been where they are. implication being that don't be surprised to see rates down to 2, 2.25. what do you think that would do if we saw a decline of that magnitude? >> well, recently the ten-year treasury was at 2.5, so it wouldn't be an enormous surprise. but i think that yeah, i think that these declines matter. i think people are watching mortgage rates. you know, they remember back when mortgage rates were 3 -- got down to 3.35% in late 2012. that, i think, has a big psychological impact and now the mortgage rates are down to latest number from freddie mac is 4.14, that's getting back down there and that might stimulate the market. >> finally, robert, big story in "usa today" about home equity lines of credit.

up 20% in the past year. that's the fastest increase since the crisis. do you think the housing market will be an engine for consumer spending in the year ahead? >> that is a distinct possibility, yeah. i think it is on the way up at this point in time. when they learn to respect momentum. i think other people are respecting it too and might affect their purchasing behavior. so things are still looking positive, despite some bad news we had on housing starts. i think that it's still looking up. >> robert, great to see you. safe travels home. we'll talk to you next month. robert shiller. >> great. >> case-shiller home price index this morning. when we come back cramer's mad dash, count down to the hoping bell and disney's blockbuster "frozen" living up to its name with an ice show as they milk that franchise. >> oh, boy. >> we'll talk to the show's producer later on. another look at the premarket and more "squawk on the street" from the nyse is straight ahead.

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this is the age of taking action. viagra. talk to you doctor. still about:30 before the opening bell on this tuesday. time for our mad dash. start off talking cisco. >> deutsch bank upgraded cisco hold to buy. new product ramp is stronger than expected and the actual new products are revealing some very solid booking trends. you know i felt that was the quarter turner. i've been waiting for cisco to reveal the few products and to

see how they're doing. cisco's ad campaign apparently doing well. john chambers more fired up than i've heard him in many years visiting the 100 largest accounts and examining through with a very good depiction of business. u.s. business is back on track. i like cisco. >> now, you know, you followed this company relatively closely for many years. >> since '94. >> i kept an eye on it. feels like every time we think they have wind at their back and real momentum something else comes along and then we have to reassess. >> i'm not going to disagree with that. it's been a fits and starts situation. i like to see that the u.s. is doing well. i mean, is china doing -- we don't know china. we know that china is pushing back because of nsa considerations. but this is a north american story, could be a turnaround. again, john chambers, it's been a little hit or miss. i think it's hit and i think it's more than a one quarter phenomena. because new products have a long tail here. the company is back. it's inexpensive and i also like

the dividend. >> let's move on to bank of america. >> all right. >> bac. >> we're beginning to wonder, was bank of america the problem with that $4 billion error, is that a tempest in a tea pot. new capital plans submitted indicating it's a very, very minor issue. who knows what the fed will do. however i would tell you this killed the stock. it absolutely killed the stock. because the quarter was fine. i understand the company to be having some very good momentum for the quarter. but obviously the submission was -- >> that was a killer. >> the caplan sent back. >> in the meantime that's when wells took off. i think my charitable trust owns this. it's been a disappointing stock for the trust. now you have to see whether it regains the luster and starts catching up to other companies. credit suisse by the way upgrade here by deutsch, worst is over. a lot of these american banks are secretly hoping that credit suisse starts losing business.

it hasn't been the case. more than a few instances. >> right. that after the criminal settlement. that is criminal -- how do you term that? criminal -- >> when you look through the justice department, please keep doing business with credit suisse. like a travel ad, go to switzerland and do business with credit suisse. >> more "squawk on the street" coming back after this. ♪

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with the future of trading. company profile. a research tool on thinkorswim. from td ameritrade. you're watching cnbc "squawk on the street" live from the financial capital of the world. the opening bell set to ring in a couple minutes here. we kick off the final week of may, the second quarter is almost two-thirds over. >> i don't want to think about it. but you know, sell bad stocks in may and go away did work again. a little qualitative tone there. >> the bad stocks. >> more of an ee comings kind of -- >> not even the stock market has such small hands. >> i don't like the concept of anything that says go away in an atmosphere where you can wake up and see a done deal like hillshire and pinnacle with a

furiously higher bid from a company we don't talk about enough, jimmy dean, a chicken and meat thing going on. >> pinnacle would in the fit, right, so they went outside of meat with the pinnacle deal. >> right. >> these guys of meat meat. >> chicken is having an amazing year because of the record corn harvest, a cost of feeding chickens has plummeted. >> the cows that are eat more chick reason winning is that the thing in that ad. >> cows that eat more chicken. >> chick-fil-a bill board. >> intraday high on the s&p will 1902. looks like we're going to open above that. >> wow. >> vix at 11 and change, down from 81 in november. >> none of this is supposed to be having. you have one of these moments where if you had another country -- another area do well, whether europe or asia, you would be hard pressed not to think we wouldn't have a nice run here. summer rally.

used to happen, remember. >> summer rallies. >> yes. >> yes. >> meantime we have a great -- our bell ringer here at the exchange, a look at the s&p opening bell here at the nyse. the winner of the indianapolis 500 this past weekend, ryan hunter-rey. speak with him a few minutes at the nasdaq. nps pharma. ryan hunter-rey, second closest finish ever by 0.6 sfeekz lead changes nice to thing. >> first american to win since 2006 and the little boy there in the racing suit is his son riden, who took part in the celebratory drinking of the milk after the finish. >> got milk. >> francois nader is the nps pharma over at the nasdaq. it's another one of these great orphan drug companies that has come down hard. all come down very hard. keep in mind that group is --

>> we've not mentioned apple this morning. this story out of the "financial times" they plan to announce a software platform that would enable your iphone to control your home appliances, your lighting, your security. the ft says this is coming at their developers conference next monday, june 2nd. >> i'm close to dave cody, meaning i live next door to him in summit, he was joking about the idea that google spent so much on nest which is another one of these products where you wave your hand and suddenly gets recalled because it doesn't stop. nest has been plagued. these are companies -- i don't know. apple should be trying to control the car by buying harman, not the home where they should be partnering with honeywell which has the best technology or att which has often said go with our product. i don't want the home to be dominated. apple meanwhile has been percolating. the stock has been a real winner. the split is coming. it is loved again.

>> quietly loved. >> and the trust still owns it. >> yes, it does. this is more right now than affair people are having with apple. no longer right out in front, the love. >> not living together yet. >> not living together and it's sin. it's sinful the way the stock has gone up without anyone really -- remember they used to come in raising that -- >> what, where's the love though? the love is not completely there? >> no. the analysts are like, listen, it was really financial engineering. meantime the stock keeps going higher because it it turns out the split was liked and buyback worked. here is a buyback that is retiring stock that was aggressive not sitting on the bid side and get whacked. they're retiring a lot of stock. >> is it financial engineering when you generate that much cash and using some of it to buyback stock. i would argue when using the bulk of it for some companies as we know, it is the crutch to make eps numbers. i wouldn't necessarily think that's the case here. >> but you take a look at a company that reported this very

morning, auto zone, barely up by the time the conference call is on it will be, this is a company that's retired almost half of the stock in the last six years. take a look at the way that stock has run, if you do a buyback that has actual fire power, which i think apple has done, you're going to get that run in apple. >> although people, per store inventory, up 9%, domestic comps up 4%. people wonder if they will have too many goods later in the year, have to start discounting. >> that's why they have the new marketer from ber bury who is going to do a terrific job. she had that idea of the kissing of the iphone, mine doing so many great marketing things. wait until you see what comes out of the apple. in the beats deal not being done or maybe being shelved people are saying positive. >> right. i was referring to auto zone on that statistic. >> auto zone is about the auto fleet being 12 years old and people fixing their cars. >> deferred maintenance spending

up. >> i think that a lot of car companies are doing quite well but you don't get a lot of love for them in part because gm, my charitable trust owns that, a hideous stock to own. phil lebeau has nailed that five ways to sunday. there was a european or a chinese real call? >> almost a recall it seems every day. >> it's tuesday. >> of the work week. >> it's tuesday's recall. >> yeah. >> no. that's not good. although you continue to be positive. >> i am positive on it because the sales have been great, despite the recalls. and in the end, this is a margin and volume story. not a story of recalls. people want to make it a recall story, but the cash flow remains strong. when i -- if i hear a question about the dividend it's totally off. >> did want to talk more about pfizer and astrazeneca. azn shares are down, although the bulk of the losses that took place took place last week as when we told you the deal did appear mostly dead. now we can say it's completely

dead. although could be brought back to life at some point in the future. one never knows. but that said, pfizer strategy certainly not -- certainly open for criticism by those who follow these things closely and merger and acquisition circles in terms of why they didn't just immediately go hostile or why there was perhaps infusion amongst them and astrazeneca or not -- because then astrazeneca said okay, 58 would have done it. they were 55 where they were stuck under uk law. regardless, the bigger takeaway here as we said so many times, focused so many people on inversions on u.s. corporations looking for a lower tax rate and perhaps as or more importantly, looking for a place so that they can use their cash that they generated outside the u.s., in the u.s., without having to pay the tax to bring it back. that is as important a component of inversion strategy if you will. >> that's a really great point.

>> than anything else. i will tell you right now that, in fact, pfizer's deal falling apart, may be helpful to other companies looking for inversions. perhaps the heat will no longer be on as much. and some of the names that are out there, that are looking to invert, i am told, would make your head spin. now that doesn't mean it's going to happen. but this is not done by a long shot. in fact, later on in the program, i think ra burcough from lion tree will join me. >> how is he doing? >> we'll find out. >> that would be communications. >> well, he's also seeing some other things. >> time warner kind of thing? >> it doesn't have to be pharma. what happened in pharma you have a bulk of companies that do it, it becomes a competitive disa advantage to try to compete against them. everybody tries to get in before the window closes if and when the window does close. >> a lot of bioteches could do

it. >> absolutely. >> pay high take rate. listen we have applied materials, doing it with -- >> with the tokyo electron. >> a deal i didn't think was going to go through. it's sailing through. >> yep. >> 1908, s&p, that is a new all-time intraday high and the dow is up 11 to 14 sessions. let's get to bob pisani on the floor. >> as i came down, happy tuesday, everybody. all ten sectors in the s&p 500 were higher. keep an eye on that. record in the s&p as carl said, nice to see those case-shiller numbers. put up the builders, they were up fractionally as they came on the floor. up one and a quarter percent. case-shiller index. price up a little bit after moderating. more gauge rates flat to down in the last couple months. all this is good news. remember the prevailing paradigm, is housing was stalling out. numbers we got on friday, and thursday and the numbers today indicate that stall is not the right word to use. maybe not roaring again, but certainly not fading away.

all this very, very good news for the markets overall. elsewhere, the big gainers i was coming down here, utilities. i don't think there's anything fundamental going on. a journal story talking about president obama opposing a climate rule. maybe that will have influence on the utilities. >> quiet week for ipos. things have been looking up. bottom in ipos occurring. we're waiting for more details on alibaba. they, of course, filed the initial s 1 but a lot of blanks there. we want more details on the revenues. we need more information on what kind of other joint ventures they've had to put a multiple on the company. they'll fill that in in the next couple weeks. where will they list? nasdaq or nyse. both exchanges were in asia last week pitching why they should be listed on their various exchanges. starting to heat up. they were out there, definitely pushing their cause. we don't have a decision yet. i don't think you may get that -- i don't think you will get that until they file for terms. i've said before, terms unlikely

to be filed on this until mid july, maybe the early part of august. we may have another month to wait before we find out where things are going. meantime signs of life in the ipo market. most important thing number of filings out there. i was out friday, didn't get the numbers until a moment ago. 13 companies filed to go public last week. they wouldn't file if they didn't think things were doing better. 13 filing is a good sign. most important thing to watch the stock market. the nasdaq has bounced off its bottom. it dropped april, march to april, dropped like 8%. it stabilized in the last few weeks. that's the most important thing to watch when people ask me, i say watch the nasdaq. that helps determine the ipo strength right now. also, the etf for ipos, the renaissance capital etf, symbol ipo. after dropping about 10%, in the early part of the year, it, too, has now stabilized and come off. 6 or 7 sessions where it was up almost every single day. that's another positive sign. also, we had friday a couple good ipos.

parsley energy, a lot of talk on that, up about 30% on friday. still holding right now. speaking of ipos, new york, stock exchange is ipo'ing its european operation, not the life operations but most of the exchanges over there, they said today, that about a third of the ipo would be sold to european interests here, including abn, bnp and other european financial interests. more on that a little later. but this will be largely the stock exchanges in paris, amsterdam and france and lisbon. back to you. >> thanks very much, bob pisani. all right. another m&a related story in the faber report today. allergan and valeant, remember that fight, it continues. and this morning allergan perhaps finally can be termed to have taken the gloves off or become a bit bolder in its attacks on valeant. i've been talking here for quite some time about what appeared to be a lack of focus on allergan's part on trying to undermine valeant stock price and its business model. this morning in a detailed

presentation, that allergan has filed with the sec, the company does could that to a certain extent on the business model sign, employing the financial consultensents and forensic firms of fti consulting. interesting not its own investment banks who are advising it, goldman sachs and bank of america, but these two outside consultants to evaluate certain concerns about what they call the inherent value of valeant's business model and stock price. a lot to go through here. not enough time to do it for you. let me give you some at least highlights here. we've talked about it. jim and i on the show have talked about it many times. by the way, still remaining completely unclear what allergan will be able to do to create value or whether it can succeed in trying to simply stave this off raising enough questions about valeant, its rollup strategy, the way that it goes about cutting r&d, and benefiting, of course, from an

extremely low tax rate. here's a couple of the keys. valeant, for example, on announced synergy, allergan points out valeant's announced synergies in previous deals. sef fa lon, medicis, bausch & lomb, how can it possibly be that high, only able to achieve a fraction of their sdna and synergies without destroying near and long-term value. they say valeant drastically underestimates the spend required by what they say is $350 million. an they're unrealistic the synergy numbers as communicated in numerous letters to customers. they point out allergan's core business will be at risk as i said with this, saying hey, look where they are, sgna would go to 10% and rg ratio under 2%. that's not something that is possible, preferred or certainly

sustainable in terms of the actual franchise that allergan has over the long term. some critics in the banking world have said i don't understand why they're not trying to undermine valeant stock price. they would note goldman sachs, allergan's adviser, advised valeant on equity offerings in the past, perhaps that has been one reason they have been moretti sant to come to attack. at least in this case we have stuff on paper here from allergan trying to undermine valeant as we've thought they might. valeant, of course, for its own part, jim, is going to fire back, tomorrow when they're going to raise the bid. two weeks ago they told us they would raise their bid. another strange part of the strategy. we'll see what that entails. they're getting in front of that. >> allergan knows this company very well. they bought valeant -- valeant bought medicis, a skin -- med

medicis claimed they had a lot of things going. when i look at that deal, it doesn't seem that good. bausch & lomb, criticism. i thought one of the most interesting things here was in the confidential draft to speak from allergan, they mentioned chain nose on cnbc, talking about a rollup and how they don't work that well. >> on ma medicis business they claim allergan it's losing market share and increasing prices at an unsustainable pace since allergan acquired medicis. >> from stocks to bonds. rick santelli in chicago. >> we are unchanged in the tens hovering at 2.53, we did have some decent housing data in the form of case-shiller, but keep in mind, the durable goods was really more about march revisions being better than expected. april a bit disappointing once you really looked at the internals and nonseasonally

adjusted april data softer than the appearance of the seasonally adjusted data. you could clearly see on the chart pretty much right after the 8:30 data started to come out and the 9:00 data started to come out, we saw that yields started to move lower. how much lower? open the chart up, we are hovering in a zone we haven't seen since july but this could be the seventh, yes, the seventh trading session, we're going to close in a range between 2.51 and 2.55 on yields. tight range. if we look at the euro versus the dollar and realize that there were parliamentary elections, surprising to some, but still, the establishment holds the majority of seats like they did in the last vote. 136 handle trade. open that chart up to february we're in a zone, the lowest level versus the greenback since february. like the treasury notes it's holding in, same could be said for the dollar/yen doing a lot of work between 101 and 102. you see on the intraday, open the chart up a bit looks like

ten-year note yields, sideways seems to be what we're looking at for the future. back to you. >> rick santelli. when we come back the man who's fresh from winning his first indy 500 championship, ryan hunter-rey today's bell ringer at the big board with his son. they're going to join us at post nine in just a print. just a pri. why do cities shine so bright? it's the glow of opportunities of countless people, every one of us, striving to succeed. that's what lights cities up for more than 200 years, citi's job has been to help empower people and business. wherever ideas come alive.

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from the opening bell we want to welcome ryan hunter-rey, the first american to win since 2006, won it in the second closest finish in the history of the race, got three hours of sleep according to his twitter account. good morning, congratulations. >> thanks so much for having me on. >> so much being made of the finish and lap 199, but i just got to ask you what your thoughts were going into that final turn and not knowing how this was going to end? >> typical verizon indy car series fashion. right down to the wire. really had no master plan. it was just more going on

instinct. going with experience and helio and i were running inches apart. some of the most intense racing i've been a part of. >> is it true andretti gives you a pep talk halfway through the race? >> he's one of the fastest drivers ever to be in a race car and he has great advice and as a driver examining through the ranks great to hear his voice on the radio. a sense of calm there. and you know you need to get the job done for him. >> when i watch it, this is a team effort. how many people are actually involved with ryan winning? >> you know, it would have to be in the hundreds. on the car itself, about 20 guys that do this. then we have our partners, dhl, auto nation, so many people that have come together to make this effort and this dream a reality. it's a great story. >> and the 2 million plus, i mean is that like a check to you that you now invest?

would you ever buy stocks? >> i would. absolutely. i do. i'm investing with some friends down back at home, global wealth management, but it really is an opportunity and there's a contract worked out there where you have the prize money, right, just like taxes, it doesn't all go to the driver. but share it with the team and hey, i'm just so proud to be flying the stars and stripes back at a very international event like the indy 500. >> a good headline number. people may not be that familiar with your story. wasn't that long ago apparently you were teaching driving at a ferrari driving school? >> i was hopping around trying to find work in the racing community and i had opportunities at different indy car teams along the way, sponsorships dry up, the market's volatile that way. but found a great home at andretti auto sport. we won a championship together. now the greatest race in the world, talking to you guys, i'm

thrilled. >> talk about cars all the time often through the aspirational lens, teslas. >> sure. >> do you have cars that are your favorite? cars that you love to drive when you're not racing per se? >> absolutely. you know, our family car, you saw my son with the race suit. >> acura mdx. my first car was a z-28. the pace car was a brand new z-28. the driver wins that. >> dan hasn't gotten you in a stes la yet? >> i can't wait to try one. >> would you try a google self-driving car? >> no. i have to drive. that's where i cut it off, right there. it could be electric, but i have to drive it. >> ryan -- one more? >> how much fuel do you burn? >> oh, i mean we have 22 gallons, only lasts about 30 lapse around there, so you figure that's 60 miles. and -- >> 60 miles. >> don't have to pump your own. it's nice. >> we're doing top speed this month we clocked was 240 miles

an hour around indianapolis before we go into turn one to make the dive into one of the most famous turns in racing. average speeds up in the 225s. it was a fast-paced race and one that had an excellent finish. >> conglatslations. >> great having you here. >> try to get some rest. >> thanks a lot. >> stop trading with jim in just a moment. a moment. in a world that's changing faster than ever, we believe outshining the competition tomorrow requires challenging your business inside and out today. at cognizant, we help forward-looking companies run better and run different - to give your customers every reason to keep looking for you. so if you're ready to see opportunities and see them through, we say: let's get to work. because the future belongs to those who challenge the present.

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and add voice and tv for $34.90. comcast business built for business. trading. >> we're great texture, russia seems to have been gotten back on the grid. pacific crest has a note, visa and mastercard, suggest domestic network risk overtated, we had been fearing russia was going the way of venezuela. cut numbers big. visa and mastercard should be up much more right now. they really got hit on their quarters because of russia. the business itself, both were fabulous. v and ma are right to buy and will go higher. >> even one reason crude has come up because of the victory in ukraine. >> i think there's going to be -- not saying normalization and not saying we're not going to keep it back on the front page but does seem like the

commerce between the west and east being resumed and important for visa and ma. heavy exposure to russia. >> tonight on "mad money"? >> continuing with this theme of natural and organic. it's been a winner. the companies that sell into it, sunopta is one. you see a whole food dpouns and say, that industry is over. no. this is an arms dealer situation. everybody who has product that is natural and organic selling well. >> see you tonight, jim. >> good to be back. >> breaking news on consumer confidence and founder of jetblue when we come back. we c. i make a lot of purchases for my business. and i get a lot in return with ink plus from chase like 60,000 bonus points when i spent $5,000 in the first 3 months after i opened my account. and i earn 5 times the rewards on internet, phone services and at office supply stores. with ink plus i can choose how to redeem my points. travel, gift cards even cash back. and my rewards points won't expire. so you can make owning business even more rewarding. ink from chase. so you can.

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welcome back to "squawk on the street." breaking news. may consumer confidence, 83.0 matching expectations and a bit better than last month's unrevised 82.3. 83.0 is a powerful number. keep in mind 83.8 was a march read and that was the best since january of '08. snugging up to that. we also had another number. if you look at may, richmond fed manufacturing index, 7 came out at 7, expecting a smidgen higher which equals last month's read at 7. kayla, back to you. >> all right. thanks so much for that, rick.

for more on the markets art cashin, director for ubs financial services. good tuesday morning to you. >> good morning. >> looking at a match of consumer confidence what do you make of the data and what it means for today's trade? >> the morning's data is not going to be a problem for the bulls. they have the momentum back. they have a minor obstacle in the s&p, the area between 1910 and 1913. and if we push through that, then things should be all right. i think the big surprise so far this morning is that you didn't have more activity. there's been a lot of people short this market and for the s&p to make a record closing high, you would have thought they would break out a little further. the negative was it was the slowest day of the year, but the price is right. >> when you look at the s&p nearing an all-time high even today and the vix under 12 as we go into what is normally a slow summer, is that ominous or do

you think that's a good sign in terms of the smoothness of the markets ahead? >> i'm not really an expert on the vix but i quoted two folks this morning in my comment, peter who you know, and jim brown over at option investor and both of them saw the history of the vix at this level as being slightly cautionary. that it indicates a complacency reflected maybe in the price. i'm not so sure. i'm not a big vix fan. there are other people out there watching it. >> what does it mean, the stock market has basically gone nowhere for half a year. the volumes are so low. everybody presumably seems comfortable on the position that they've taken, whether they're long or short from what you're saying. we're going to wait this out and see who's right in the end? >> yeah. because there's an interesting divergence here. that divergence is between the actual earnings numbers so far which have been good enough to take the s&p to record highs, it's at a reasonable multiple, and then you look at the big

picture the macro data and that really hasn't justified the market where it is. you have this kind of split school where people who follow the macro side say well, okay, i can see a mild bull market, but i don't see record highs. and others look at the earnings and say we got here. you're right, there's still a debate. the macro guys are saying you only got here through financial engineering and the other side is saying, we got the earnings. what do you want? >> also the added argument of declining participation, right? stocks 52-week highs. is that a legitimate data point or not? >> i follow that a little bit better than the vix. if you you look at -- to give you a reverse answer, if you look at a series of selling climaxes that we had right after the lehman bankruptcy, if you watched the decreasing number of new lows, you would have actually been able to pick the

bottom of the market. >> really? >> yeah. and it -- you got fewer and fewer new lows which meant that they weren't throwing everything out the window. people were getting a bit more selective. so when you get to record highs with diminished new highs, it certainly is caution nare y. keep an eye out. >> durables, the data not a problem for the bulls. barclay's suggesting a 3.1 q2 gdp. do you think the spring early summer will look better than q1 did if? >> i think it's going to look better. i'm not sure, everybody is still waiting to write off the polar vortex and all the problems that it brought. so we'll know better later in the week when we get the gdp. it's going to get marked down at the negative territory. that will be the load they have to pull on with the second quarter. >> finally, art, you always have your eye on the treasury market as well. you've been talking about the ten-year and signals it has. you called 2.5 before we were

even close to 2.5. i'm wondering where you think the ten-year goes from here with so much fed speak coming out over the summer and i think a surprise for a lot of people that we are seeing such strength in treasuries. >> yeah. i think that strength may well continue. i would love to be brave enough to say 2.25, but 2.35, okay. i think 2.35 is attainable and even some bright people like barry habib have picked that number. >> thanks for putting this in perspective as always. art cashin from ubs. >> shares of ihg, owner of the holiday inn brand were on the rise jumping more than 5% on a report that the hoteler in the uk has rejected a billion takeover offer from an unnamed bidder in this company, sky news not sure if it was starwood capital or starwood the chain. joining us is the managing director with sun trust equity research. nice to see you, patrick.

good morning. >> good morning to you. >> if you read the article, the fundamental question you to ask, do investors have to position for the possibility that big u.s. hotel chains will take over foreigners in order as the pharmas have been trying to do, to dom soil for tax reasons and avoid u.s. taxes. do you think this is going to be a major trend? >> for the hotel industry i wouldn't say the tax issue is the main consideration. as you mentioned the rumored companies to purchase possibly intercontinental is starwood. what's unique they derive about two-thirds of their earnings domestically. more in starwood's case more that tegic reasons as opposed to to tax reasons. >> how would the brands fit in your view? explain to us why stra tegically it might be a good fit. >> sure. absolutely. with starwood hotels, i don't know if you're a member of the starwood preferred guest program, they don't really have

a core mid-scale brand, something that could compete with hiltons, hampton in or marriott's fairfield in. they're towards the higher end of the chain and really to fill out your brand as it relates to your preferred guest program, you want a mid-scale brand in there, something where us business travelers, myself, will stay at a westin, but then when we go with our family use our points for the mid-scale brand and that makes it attractive to us. unfortunately starwood doesn't have that comparable brand. >> tell me, more broadly, do you think the ceo of starwood has a problem that as an investment it's losing its luster a little bit. the story in many senses with the returning of assets, expansion of asia in china, has played through, whereas intercont nenl 58 in many people's eyes a restructuring story, ten years since spun out of the uk? >> i'm going to disagree there.

i don't see the story with starwood played out. one of the challenges starwood has had over the past year, investor sper sepgs with their balance sheet. they didn't basically -- or minimal amount of shares back over the past year and a half. they have a very attractive debt profile. that's, you know, putting that altogether, investors were disappointed they hadn't bought shares back. >> you know, patrick, this industry is littered with major mistakes. at the time or maybe a year or two afterwards, blackstone buying hilton almost at the top of the market to take it private. in your view, is now the time to buy the stocks, whether you're another ceo or investor, given where we are in a cyclical business? >> you know, simon, as i wrote in some research reports over the weekend, i'm market perform on the sector. i think the greatest outsized gains have been made between

2009 and 2011. however, i do see this group continuing to grind higher. until we really see that seminole event in our sector, you know, something the equivalent of hilton being bought out, i don't think we're at the peak. if i were to put the -- relate it to a baseball game i would say we're in the sixth or seventh inning. at least another year yet of grinding upside with the lodging stocks. >> good to see you, patrick. thank you for your time joining us from sun trust. >> let's get a market flash here from dom chu looking at aeropostale and additional liquidity here. >> the stock is moving higher on news it secured about $150 million in terms of a credit facility from a private equity firm, sycamore partners, in what could be a lifeline for the struggling teen clothesing maker. posted its sixth straight loss last week up about 13, 14% towards session highs. of course it had a bad week last week. >> thanks a lot. when we come back the founder of

jetblue and west jet taking risks and making changes ahead of the world cup and olympics in 2016p. david neeleman will talk about how he's preparing brazil for the massive events when "squawk on the street" comes back. s&p 1908 the all-time intraday high. high. ♪ ♪fame, makes a man take things over♪ ♪fame, lets him loose, hard to swallow♪ ♪fame, puts you there where things are hollow♪ the evolution of luxury continues. the next generation 2015 escalade. ♪fame you need to see this. show 'em the curve. ♪ do you know what this means? the greater the curvature, the bigger the difference. [sci-fi tractor beam sound] ...sucked me right in...

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keep your eyes on the s&p. the first four-day winning streak in a month, since the 22nd of april.

and momentum names by the way which are helping things out today. >> a lot of movement in the markets today. we want to talk about the world cup which kicks off in brazil in about two weeks. already a record number of tickets have been sold. with 600,000 visitors expected. brazil is rushing to redraw its routes to avoid traffic jams as some of the visitors look to go to these games. here for a cnbc exclusive is david neeleman, founder of the brazilian airline azul and founder and former ceo of jetblue. thanks for joining us. >> you're welcome. thank you for having me. >> six years ago when you guys started, the pa jorty of your air routes didn't list in brazil. what's the progress? >> you know as you mentioned, we're in 105 cities in brazil and there was only air service to about 60 when we started flying. we're all over the country and so, you know, with the world cup, obviously it's going to be interesting. i'm confident things will go well. a lot of press about it, a lot

of concern. we're a business travel airline and so about 20% of our routes we'll cut back during the world cup because there will not be a lot of corporate travel and there will be plenty of space for us to be able to fly the extra sessions. we have about 800 extra flights we're flying and then another 600 we have charters so i think it's going to go well. we're excited for the world cup to be in brazil. >> the world cup matches will take place across 12 countries spanning all of brazil, david. i'm just wondering, they're taking place over an entire month. what sort of occupancy are you seeing? what sort of demand from travelers to not only come to brazil for the world cup which is a popular thing to do, but also travel within the country to travel to most of the matches. >> as you mentioned, brazil is the size of the continental united states and the matches are 12 different cities. we're he flying people from one end of the country to the other. like i said, we're going to be pulling back a lot of our service and there will be plenty of space.

when brazil plays it will be a bit of a -- quite hectic, for example, there will be 100 extra flights flying in on that day, but i think the government and working together with of the government regulators, we have slots, we have a plan in place, the airline will work closely and it's going to be hectic but it's going to work. >> you made the decision, david, to cap prices during the world cup at roughly 420 u.s. dollars. i'm just wondering what went into that decision and what you expect the reward of doing that will be even though it will come at a cost? >> there was a lot of talk about price gouging and the government was a little bit upset with the airlines that they were charging too much and so, you know, we did the calculation. it was going to cost us like $10 million. it was really not that big of a deal. so we decided to cap it and invite everyone to come to brazil and say, you know, we're going to treat you fair, we're going to have extra flights, make sure you get to the matches and it was a great pr move and

the government was happy with it and that's important to us. >> david, i'm sorry, i need to take you back to one of the burning issues in this country, united decision to crack down on baggage in the cabin. obviously some people that behave badly with cabin baggage, that goes without saying. i was on a flight yesterday from boston and my bag was taken off me. which i was kind of okay about until i got into the cabin and realized some people have been able to keep their bags and seemed almost random whose bag had been taken and whose bag had not. importantly there was a woman behind me who was complaining quite quietly to her neighbor she was on a paris and connecting flight from newark and would not have her bag for the duration of that flight. do you think united made a mistake and will rule the day in the way in which they are? >> that's a tough call. i was on a flight the other day from washington where my seat

mate got her bag taken away and got on board and there was plenty of overhead space to put her bag in. she was trying to make a connection and so every airline has to do things the way they fee fit. we're more customer service and our airline when i started jetblue we focused on this, to make sure everything was totally full before you did that. and give the bags back to the people when they get off the airplane as opposed to making them go to baggage claim. >> or at least understand where that passenger is going to. for the woman going to paris, her needs for baggage surely even on the short flight from boston to newark are greater than somebody leaving at that airport? >> absolutely. and they -- if they take a bag away should give it back to them when they get off the airplane. >> a few milestones from azul, rolling out service to the u.s. from brazil. i'm wondering which happens first? >> well, you know, we're going to start flying first. we're ready to go public.

it's -- the company is doing well. we're profitable. everyone's excited about the company. like i said we're in 105 cities, 900 flights a day, 25% of all the revenue in brazil. that's good. we're waiting for the market to open. probably some time after the elections at the end of this year. in the meantime we're taking delivery of our first wide body airplane, air bus 330s and announce a start-up date, but somewhere end of the year, first quarter of next year. we'll be flying to florida and hopefully to new york later. we're really excited about flying to the united states. our -- people in the united states are going to love flying azul. we give great customer service. >> do you still commute every week to sau paolo. >> no not every week. but i'm a frequent nent flyer. it's not a bad trip. my family is here. we're doing great things in brazil. 10,000 people, 20 million customers, it's been a great experience for me personally.

>> all right. safe travels, david. american free efrequent flyer. >> 145 million users of ebay are being asked to reset their pass codes after data hacked. is the nature of the cyber atta attack i attack changing? the president of mcafee will join us live with his take on the state of internet security. . she keeps you on your toes.

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take a look at the financial sector today, one of the best performing sectors as the markets hit new highs. dom chu back at hq with more. >> the best performing one in

terms of the s&p, led by bank of america shares, this on news the company resubmitted its smaller capital plan to the federal reserve bank as it works to overcome the $4 billion capital error it disclosed in april. intercont yenl exchange higher on news the nyse is moving ahead with the plan of the ipo of euro next and then american express benefiting from bullish comments from morgan stanley analysts. metlife and citigroup round out the top five. a nice day overall for the financials, second best performing or biggest sector in the s&p 500. back over to you. >> 1900 on the headline figure. thank you. another day, another major security breach. ebay asking users to reset their passwords after its user data base was compromised. the on-line auction giant losing control of data that contained user names, contact information, and even encrypted passwords. over the weekend, ebay continued urging customers to re-set their passwords but is such action

enough to protect identity theft? here, we're talking about 145 million users. joining us on "squawk on the street" is mcafee's president michael decesare. welcome to the program, sir. >> thank you very much. good to be here. >> how do you think that ebay is dealing with the issue that it has? >> i think what makes this so newsworthy as you said, it's another example of a big company being hacked with 145 million users, it's going to get headlines. what we've seen from ebay so far has been very strong response. they got ahold of their customers quickly, been very concise and clear about what they need to do. but again, there is confidence that gets shaken each time we see one of these for sure. >> interesting. interesting michael. i see from reports there's criticism they may not have acted fast enough. and that they originally knew about the breach in early may. >> when you look at the amount of malware out in the world, what companies suspect versus know is a challenge.

when ebay knew this to be an issue, what we saw was them actually act very swiftly and in a very positive and aggressive manor. >> i'm assuming is ebay a client of yours? just for trans parnsy here? >> ebay does use some of our products. >> right. >> it's rare you'll find a big company who doesn't use some of our products. >> of course. >> for sure. >> what we are witnessing though, let's not forget we know the ceo of target was actually sacked, partly as a result of what happened there, what we are seeing is that the pressure is mounting, maybe not on the business case but from the regulatory side. ebay three states of what went on. the ftc importantly has won an important judgment against wind ham which means they too in the future may be able to fine and enact greater discipline across this space. do you think the regulator will soon outweigh the business case for tightening security? >> i think that for anybody

who's going to take credit card information on-line and we're to trust them with our information a level of expectation about how they're going to treat that private information. i think what this really moves us towards, though, is does the concept of passwords work? as all these device comes on-line, managing passwords it's been shown it can be breached. when you look at the machine out there, whether a smartphone or laptop it has a gps, it's got a camera, a recorder, all of those things can be used to try and biometrically authentic and know the person trying to log on is the person itself. that's where i think this move is toward. >> the fact it can happen at target, ebay, some of the most sophisticated companies in our economy has raised the question whether this will happen on a regular basis, over time become more frequent and only way the consumer can protect themselves getting some sort of insurance, that down the line, you insure your house against a hurricane,

you insure, you know, a fancy piece of jewelry against possible theft, i mean, do we move toward a model where every consumer has to pay for this protection? >> you know, it's an interesting concept for sure. i think, you know, as we as consumers do more of our business on-line and trust our credit card on-line, we have to have that protection that if something like this happens, we're going to be safeguarded against that and that's going to fall on the cloud providers to make sure they provide that. as i was saying, that whole concept, though, of trying to advance the concept of a password to be something that is more secure is a very good way for us to safeguard against that. >> let me pick that up. you're saying something important there that we need to change what we're doing. what does the mechanism become? who becomes the provider of that biometric information. who is the gate keeper if you like? >> it's very -- >> same way we've seen fingerprint technology? >> what is interesting about the way apple augmented that,

fingerprint. it has a voice recorder so you can look at your voice and gives you a thumb print so to speak. you know, the gpss on that device will be able to tell you where you are so you know if you live in new york city and the transaction is not coming from new york city that might be a way for us to stop it. >> it's interesting who will step up. when we look at what we do intel and mcafee together one of the big areas we're attacking that very nature of trust. who can you trust to make sure you provide that level of security when you log on to the internet. >> but what you're saying is the solution, let me just pursue it, the solution here is a matrix of details. your leecation, your past performance, your voice will not just be one data point although that seems to be the suggestion you're making. >> that is exactly. when you look at ebay, target, both examples where the basic password authentication we use today was breached. there are better ways for us to

do this. as i said, you can use -- like apple did, use your thumb print, you can coordinate that with a gps of the machine you're on. you can do a retina scan through the camera. do a vis imprint through the microphone. all of these things stitched together can give the consumer higher degree of confidence and make it much more difficult for anybody to breach that application. >> the problem is, michael, whatever the technology is, from a consumer standpoint i just want one to have critical mass. and so often within technology there are all these ideas flying around and it becomes way too complicated to get through daiiy life. how do you ensure you have one standard that everybody accepts that works? >> that is a very fair question for sure. as you said earlier, apple and microsoft and others are all attacking these things from different perspectives and there is not a standard yet, but all those technologies i just talked about a second ago, those are fairly standard across most machines. it will be the cloud providers pushing for this. the ebay, the targets of the

world, the loss that they see in brand value from a breach, far outweighs the money that could have been put in proactively to ensure the users kept safe. you will see them gather around this for sure. >> that was really interesting. thank you for your time. michael decesare, joining us there, the president of mcafee. and be sure not to miss brian williams' exclusive interview with the former nsa contractor edward snowden in an hour long news prime time special at 10:00 eastern on nbc. >> when we come back "the new york times" editorial board coming out against a comcast/time warner merger. we will be joined by one of the top bankers. aryeh bourcough more on that after the break. ♪

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cash. dow components disney and travelers hitting new all-time highs. to david faber. >> thanks very much. my next guest began his career in wall street as a credit analyst, senior m&a adviser at ubs before founding his own firm liontree. he's always been focused on media. he advised charter communications on its failed bid for time warner cable and successful negotiation to get 4.1 million subscribers if and when comcast succeeds in buying time warner cable. >> thank you for that introduction. >> you're welcome. i remember you when you covered credit, adelphia way back when, you played an important role in uncovering that fraud i guess in many ways. let's get to the present day. comcast i mentioned it. new york times says we're against the deal, market power, broad band, comcast will get too much concentration. how significant is the problem

or opposition going to be for comcast? >> i think david and brian have been speaking on behalf of comcast and publicly i'm not sure i have much to add although i would say since even the comcast/time warner deal and charter conversations have been disclosed, a lot of other things have happened in the industry. at&t/directv. >> how does at&t and direct affect the review of comcast? >> i think it's the time of consolidation around distribution companies in the u.s. in particular. and so we're looking for stronger companies to really compete with each other in an industry that's dynamic. you're no longer just a cable industry. you're looking at telecom as competitors, satellite companies getting stronger, not to mention technology companies that have over $350 billion of cash for the top five players and coming more into the content universe. a time as elephant deals, we call them, over $10 billion or so, sort of all-time highs and up 75% from last year and about

a third of those are in that sector. >> you expect, just to see other large deals in your chosen area of focus media? >> we do. it's important to look at industries getting stronger and more consolidated when they have external threats and competitive dynamics. the three areas of m&a that we're seeing in a most pronounced way are in market consolidation in the media industry and telecom, technologies companies going after growth, we have seen that with google and facebook buying assets to grow their businesses. >> we don't know what google is up to. i'm sorry. >> they bought nest and wayz. three, companies outside the u.s. into international markets. all-time highs. that partial relates to tax, others to diversification and getting new businesses than what the u.s. affords them. >> i want to come to tax and inversions in a minute. back to the domestic media

landscape. given the consolidation going on amongst the distributors, do you think the programmers are going to be under pressure to consider perhaps the mega deals you're talking about? such as is time warner or cbs or nael of them thinking i need to get better to have my market power? >> when we first talked about a year ago, we talked all about the sequencing of m&a and distribution companies getting stronger first to rebalance the scale with the programmers particularly around sports programming. it would be logical to assume the next wave is programmers getting more concentrated. because it is a very fragmented business and you're probably going to see unbundling of the channels. the sports programmers have more levers than the have nots as i call them and see them diversify internationally which is what discovery has done or potentially consolidate in the u.s. to rebalance that power as well as they should. i think that you probably will start to see that.

>> you threw something something in there, unbundling, some would disagree with that or think it will play out over a long period of time. the bundle will fall apart? >> it is a rigid and mature u.s. media industry right now between distributioners and programmers. something has to break. and i think what you have to see is different packaging. we used to see different tiers of packages, sports packages, i think it's inevitable you will see a reworking of the bundle over time, sports, premium channels being very sought-after and some of the other channels very popular, but others will have to get reworked. that may not just be a rebundling. it may be different ways to price it. maybe not just advertising oriented but subscription based. so i think you will see different ways of pricing products for the consumers and the consumers are flexible in what they're demanding right now. >> you mentioned overseas deals for tax reasons. today pfizer gives up or yesterday actually in its pursuit of astrazeneca and that

inversion. i continue to hear from many bankers like yourself that there are plenty of companies looking at this opportunity. are you seeing that activity? >> yes. clearly a deal has to stand on its merits away from tax. has to be strategic in nature. a dynamic not just a corporate finance mechanism but we have a high tax rate in the u.s., higher than most countries around the world. companies that want to do an m&a deal and have the opportunity to reincorporate themselves into an overseas market allows them to lower their tax rates and use capital to reinvest more effectively. what happens today is there are over $2 trillion of cash sitting offshore that if brought back into the frust u.s. based companies would be taxed at a 35% rate. >> i would assume we will see more of that. final question, aryeh one i get all the time, what's charlie ergen going to do. >> impossible to predict what charlie ergen will do and i wouldn't necessarily comment on

this show, but it -- every move you're seeing take place in the m&a now does lead to other opportunities. >> he's at the center of so many things. direct and at&t, get together, that removes two potential partners for him and then you've got t-mo and sprint conceivably getting together. ergen opening all that spectrum, comes up so often in conversations and kind of points to the consolidation you're talking about of various industries too. >> it's pretty much sure to say that charlie ergen is strategically disadvantaged what i've seen people say. he has a lot of options still. not to mention his core business is now more than video. he has a spectrum asset which is valuable and in demand for many players in the industry. i think we'll see a few more moves from charlie organically or otherwise. >> a lot more bigger deals. aryeh, as always thank you. >> thanks. aryeh bourkoff joining us liontree advisors. back to you. >> thank you very much still ahead the disney juggernaut "frozen" now truly living up to its name with an ice show.

the show's producer will join us live. get your skates on. "squawk on the street" will be right back. right back. mine was earned in korea in 1953. afghanistan, in 2009. orbiting the moon in 1971. [ male announcer ] once it's earned, usaa auto insurance is often handed down from generation to generation. because it offers a superior level of protection. and because usaa's commitment to serve current and former military members and their families is without equal. begin your legacy. get an auto insurance quote. usaa. we know what it means to serve.

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welcome back to "squawk on the street." check out shares of biopharmaceutical soaring off the open. now up about 10%. a drug to treat a rare immune disorder. it's trading more than five times average trading volume up about 10.5% on that bit of news. back to you. >> thank you very much. we're up 71 on the dow. send it over to rick santelli in chicago and kick off the santelli exchanges. >> thank you very much, simon. the topic is pretty easy. we want to continue to monitor weight going on in europe whether it's parliamentary vote,

which is completed, looking ahead to the ecb. big meeting on june 5th. like to welcome my guest jerry a floor broker, spends much of his time in foreign exchange. the intraday charts quiet on the euro versus the dollar. any more horsepower in the pit? >> none. volatility at lows, 20-year lows in the yen, five-year lows in the euro, so there's nothing happening there. >> okay. the option guys don't seem to be playing. you've been trading a long time. is the central banks pretty much in charge? we sit at the lowest levels on the chart since february and nothing, sitting here in a passive mode. >> waiting for the meeting. >> okay. on june 5th, does it seem to you sitting in the pit that there would be more of a surprise if the ecb does nothing potentially sending the euro back up, versus expectations and all the talk about disinflation or deinflation that they're going

to do something to send the euro down? where do you think the surprise factor is? >> if they do something, it will be a surprise. >> okay. if they do -- that's interesting. so if they doing something that will be a surprise. so the downside in the euro doesn't seem any more possible to you than the upside. seems comfortable here. >> right. >> if we think about what's going on in the stock market, we look at our stock market, look at the dax, a chart up there, we were looking at it moments ago, all-time high in the dax. it seems as though the notion of what the june 5th meeting will be is lower euro, stronger equity markets, is there anything below 140 or 136 that listeners and viewers should be aware of? do you see one solid support area? >> 136 is support if you can get through there they might do something. they don't seem -- every time they go down there they bring it back. >> all right. on the upside, if i was short here looking for the penetration of 136, where do you think buy

stops might be located above the market price. >> shoe over 140. >> that's a wide range, 136 to 40, your personal call, are you going to be shocked if the ecb does nothing? >> no. >> okay. that's pretty much what you're expecting. >> yes. >> mario draghi, jerry's handicapping you and most likely you're not going to be doing much but the real key is how much will the euro currency be doing? carl, back to you. >> rick, thank you very much. rick santelli. when we come back, disney planning to cash in more on the movie that is already made the company more than a billion dollars. "frozen" is going to be an ice show and we're going to talk to the producer after the break. >> hang in there. it gets a little lonely all these empty rooms.

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and yet, there's someone around the office who hasn't had a performance review in a while. someone whose poor performance is slowing down the entire organization. i'm looking at you phone company dsl. check your speed. see how fast your internet can be. switch now and add voice and tv for $34.90. comcast business built for business. >> it does kind of feel like summer out here doesn't it. disn disney's movie frozen has become a once in a generation kind of the juggernaut. two academy awards. 1.2 billion worldwide since november.

2.7 billion copies in the u.s. alone. and digital downloads among the most the world's seen. and now trying to capitalize even more on an ice show. feld entertainment has produced ice shows since 1981 and nicole feld join us. good to see you. >> thank you. >> you have done this for a while. not your first rodeo. but i can't think of a better show more suited to ice than frozen. >> and we have been waiting for this movie for so long. but we are so excited to be presenting frozen and we have just not seen anything quite like the excitement happening with this film and subsequently disney on ice. >> dozens of performers obviously moving from city to city. there is goin' to be snow effects, giant video towers. are there challenges for this show? >> the expectation is so high with a film like this. there are going to be over 40 skaters. this is a class of the world

class skaters portraying their favorite characters. all kinds of the special effe effects. the music is going to be there. you are going to see the emotion that comes from them. . all kinds of the snow effects, from blizzards, a snow man, olaf will be there doing all kinds of funny comedy it's going to be great. >> having owned the license for whatever disney does like this so on. you have been obviously happy they are doing know and ice and whatever else. and the music. where are we now? how are ticket sales. >> phenomenal. they have been on sail one week. this week we're going hit 500,000 ticket. in the first 24 hours we had 175,000 tickets that we sold. >> is the sweet spot a revenue ticket sales or all the other stuff that goes along with it.

the concessions and toys. >> obviously for families it is about the experience and it is a unique experience that the whole family can enjoy. ticket sales are a part of it. but the merchandise is a big part as well. and we have exclusive merchandise that you can only get at disney on ice. these are never seen before items that can only be seen here. and we're seeing what is happening in the disney store where parents are spending 1500 dollars for elsa dress. >> how much? >> i heard 1500 dollars. i can't speak for experience. >> it's a boon for ebay is what it is. by the time it hits the ice this fall the movie will be out for almost a year. are you worried you're coming in too late for this? >> with disney their films tend to become classics. so we have several tours touring worldwide and they all do really well. because they have something different to offer. so i think as a new young sort of crop of kids come in they're

just getting old enough to enjoy this film. it's still going to continue to do well. >> you're a on ice touring company. but what is the business rational for not putting it on broadway. could it become a broadway show. >> disney has a theatrical department that has announced plans for a broadway show. we won't be producing. >> they' -- >> that will be a different offerings. >> it's not the only franchise. you are also going to handle some marvel shows. >> very exciting. marvel universe liver is launching. we're in rehearsal right now in florida. coming to new york in august. has all of your favorite marvel characters and villains live in one place. it is extraordinary. never seen before special effects and stunts. >> bigger night out than

morrissy. >> yeah it is. nico nicole, thanks for coming on the show. it's good to see you. nicole feld with feld entertainment. kayla inside to you. >> up next. apple and google compleete for smarter home. and also jesse jackson on what's missing at sb. so stick around. so stick around.

so stick around. can you start tomorrow? yes sir. alright. let's share the news tomorrow. today we failrly busy. tomorrow we're booked solid. we close on the house tomorrow. i want one of these opened up. because tomorow we go live... it's a day full of promise. and often, that day arrives by train. big day today? even bigger one tomorrow. when csx trains move forward, so does the rest of the economy. csx. how tomorrow moves. you need to see this. show 'em the curve. ♪ do you know what this means? the greater the curvature, the bigger the difference. [sci-fi tractor beam sound] ...sucked me right in... it's beautiful. gotta admit one thing... ...can't beat the view.

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i'm scott cohen in the cnbc news roam. the obama administration taking big banks. the solicitor general has argue they should not hear a case that allows pickard to pursue billions in claims against hsbc and ubs. target also initially sued j.p. morgan but they settled after this year. the trustee under the securities investor protection act should not have standing to do that and urging the supreme court to uphold a lower court ruling. the high court is looking at two

potential cases involving this whole area. one involving may dove and the other the stanford and is justices have not yet decided. but the obama administration weighing in on the side of the banks for now. carl back to you. >> thank you scott cohan back at hq. firing up the code conference. we'll be there live for the exclusive coverage tomorrow. in the meantime it's almost 11:00 on the east coast. squawk alley is live.

joining us this morning john steinberg, kayla tausche. guy, hope you had good long weekend. what a week it's going to be with this conference in california. >> i'm so bummed i'm not going to be there. i'll have to be remote. >> it's going to end up right here on this program, a lot of it. apple meets the jetsons, according the ft, the giant renovating a new software programs that would turn the new phone into a lights and securities and other appliances. and a broader push into home automation. according to the ft taking on a bunch of players who've already gotten start odd this mission. >> and honeywell has a wifi connected thermostat as well. so everybody is going into that layer. i think software and ease of use wlb what differentiates it. you have mobile desk