do, but soon or later it can all come back. >> short-term, long-term trade-off. government is the quintessential short-term decision make somewhere that's what our problem is going to be. >> larry, thank you for joining us today. pleasure seeing you. join us tomorrow, right now it's time for "squawk on the street." good monday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer and dave faber. s&p at a record high of five straight weeks but the premarks soft here. europe's down on what could be a broken cease-fire in ukraine. some worries that scotland voters are made be leaning towards independence. alibaba kick off the u.s. road show after announcing details of what would be the biggest u.s. tech ipo ever. >> shares of hertz jumping in the premarket. the company says its ceo saying

see you late. >> general electric selling home appliance unit to sweden's electrolux for over $3 billion in cash. first, big news from twitter on a potential new revenue stream. julia boorstin joins us from los angeles with breaking news. good morning. >> good morning. twitter is announcing a test of its buy now but allow users to buy products directly from a tweet, first big move into e-commerce. the idea to make mobile shopping quick and easy. so say renan can tweet a photo of the tour t-shirt and say, buy now. twitter saves the credit card information and shipping address, saying everything is encrypted and not shared without permission. >> there are products in price points of all kinds and offers of all kinds that work across the platform. it's not a flash sale platform. certainly things will work better. again the temporal nature of twitter makes relatioal time in

wheelhouse. >> twitter working with 19 partners. a number of artists including emin eminem, pharrell and rihanna. the company plans to add more retailers and roll out twitter's base over the shopping season. >> starting in physical goods, because that was a way to test the user experience we think that digital goods and on demand services, because of the real-time nature of twitter, are a great opportunity for us. we're going to start in physical goods but you'll see us expand pretty quickly. >> twitter says it does not expect retail to impact its revenue this year but huge potential in both taking a cut of the sales and also selling more ad for retailers looking to put the buy now button in front of more people. >> julia boorstin with breaking news. thank so much. holiday retail got more interesting. >> between this and alibaba, a lot of ways to buy things. >> we do.

perishables, a lot of fish you caught, sell them there, put the buy button up. >> get the drone to bring it to you, right? or an uber taxi. boom, bring it to your house. >> logistics important for that. i assume the companies providing the buy button will provide the logistics. alibaba, logistics an interesting question. >> we'll get to it in a second. >> the interesting thing about twitter, ever since anthony noto got there, all you hear is monetization. the former analyst from goldman, he's an investment banker, took a stay in the nfl, but i just like this -- i think the news flow is good out of twitter that's one of the things where you say, a year ago, how are they going to make money? now featuring a button, and the customers, burberry, home depot, customers that are

sophisticated. so it's not like these companies don't know what they're doing. they're very forward companies. >> on a day where whole foods testing one-hour gross delivery in 15 cities. >> waiting for than whole foods national ad campaign. the beginning of the whole foods playing offense. see what happens. campbells, by the way, opposite. campbell's numbers, other than bolt house, i use the bolt house vain ven inaigrette -- the cann soup is against the grain of what the country wants. >> alibaba, they are kicking off their ipo road show today in new york. the chinese e-commerce giant seeking to raise more than $21 billion, would make it the largest ever tech debut in the u.s. alibaba expects to price the offering between $60 and $66 a hair. yahoo! shares reacting. could gain $8 billion on $1 billion investment.

>> 22.5% stake. they've already sold some, a previous deal -- one of the reasons, main reason, the ipo is happening, because of yahoo's! desire to sell some of the stake. though less and less this time has gone on of the 22.5%. we've talked about it over the last more than year in terms will they be able to sell some point of it tax efficiently? what will be sole. for the alibaba ipo, bringing this giant company to the u.s., jim, you know, despite a thousand-page prospectus, a lot of questions out there. i've spoken to a handful of big investors who are going to try to get those answered in the road shows. they didn't break out t-mall, how is each one doing? they say 85% commerce, from 85% of revenues from commerce but don't tell you which is which. a different model than amazon or

ebay. it's about 3% of gross merchandise value, which keeps going up. >> enormously. but not doing their own logistics, not buying the way amazon does and storing stuff and shipping it to you. a lot of questions. but obviously, incrediblebly efficient model that is continuing to grow. although growth is decelerating but from the stratosphere. >> a good article this weekend about jack, i read it over again, i wanted to be sure i understood the ownership structure, i don't. i don't understand it. >> end board structure. very different. like when kirk goes to visit the cling-ones, everything's different. >> cling-ones were straightforward in the end. you know what motivated them? i guess -- >> really i try to understand this thing. >> what you need to understand what's the multiple? an incredible growth company,

difficult for some to understand, the structure is convoluted to a certain extent, some will take issue with that, that hasn't provided despite a lot of details as much as investors want to figure out that end question which is, what do i pay for this thing in. >> ever used the site? >> never have. >> it pops up. i wanted to buy bar stools, popped up as cheapest bar stools. i don't know, bar stools from china. whatever. sophisticated software allows you -- i'm sure jeff bezos is watching this thing. you don't want to be eclipsed by them. bezos is spend, spend, spend in china. algorithms are very good. >> kayla tausche at the waldorf, talking about the road show, launching on three continents. a piece of sound from their presentation. take a listen. >> this is the story of how alibaba has helped open up china

to e-commerce, enabled online cross-border trade and affected the lives of millions of people. in 1999, we saw how technology could help small chinese wholesalers compete with global players. so we created a marketplace that enabled them to find new customers abroad, alibaba.com. >> the education commences. >> i hope the education doesn't force everyone to sell everything else in space because we are going to have a hammering like you wouldn't believe. >> you've raised that point. this amount of supply that it will come to the market is enormous, though a lot reduced through a robust m&a market. >> friday's "mad money" saying that. at the same tie you can see what kind of stocks would get sold, high growth stocks. mute fuel fund manager no longer get money like they used to, etfs aren't going to buy it. a diminished pool of capital that's going to buy.

at the same time the stocks that look like it, whether it be ebay or whatever, i mean, if the growth characteristics are superior, you'll see amazon. >> at its basic, it's pretty nice pitch. e-commerce in china. >> it is. >> that's all i need to say. okay, i want in on that. >> how many don't have it yet? >> another key question, they have penetrated big urban centers, but what do the numbers hook like in let's call it the less mature markets in china? we'll get a lot of answers to the questions as the week goes along. >> it's worth it. when you have the largest ipo, you begin to get that kind of frenzy that we see. people ask, jim, you think retail's going to want to own it? as it goes higher, as they check the range up, 62, whatever, more people calling brokers saying i want a piece of alibaba and at a certain point we're going to say, wow, it's gotten too big,

and it can't hold. >> let's move on to another story we've been following closely here. jim has as well on "mad money." hertz announces that mark frissora, the ceo, has stepped down from that job for personal reasons. while rental car company searches for a replacement brian mcdonald will serve as interim ceo. last month you may recall hertz withdrew full year guidance, cited operational challenges, costs related to continuing accounting issues. the stock getting beat up. it has been a hedge fund hotel. i can give you more background in terms of what went on here from the board's perspective, according to people close to the board. there's a sense that frissora had lost control of the company in a way. listen, the accounting problems were not of his making necessarily. but they're in accounting h echehell in terms of restatements, they

lost a lot of top managers over time and so, they've don't to mcdonald who i am told has the inside track. >> really? >> yes. he's sunoco. >> not scott thompson. >> while still going through it, i can tell you at this point, what i'm hearing, there's a belief on part of the board that you need someone who can run a complex organization and that there's not a feeling at this point that perhaps that thompson is the right guy and it may be macdonald who gets the full time job and you need someone to take over quick after it's spun off. the big shareholders, frissora trying to keep his job, he met withicahn, other big shareholders recently, icahn, i'm told, offering to back him if given a board seat. but here you have the board saying, no, we're done, we're

moving on with linda levenson, apparently meeting with large shareholders as well this is not a board wer shareholders have ability to force them out in the near term. they were acting on their own and mr. frissora's now -- has now left the company. >> jim you tweeted he's been on the wall of shame. >> we add the wall of shame, thinking perhaps he would spend more time with the company. >> a sound from "mad money" earlier this year. >> mark frissora, okay, i've got to welcome you to the "mad money" wall of shame where when you depart you create instant value. we hope it will be a brief sojou sojourn, sir, i think hertz goes up 10% the moment you bid the company adieu. as long as you're there, avis done have to work harder to be number one. you do it for them. >> 10%, not far off. >> we'll get it, we will get

10%. the reason avis, avis has been the winner here. and they've got -- they've got great margins. hertz was cutting to get big fleet deals. they have stopped the cutting, why larry robbins recommended. >> at delivering alpha. >> saying you want to be in it? i think the tax problems, the accounting problems, weren't that great. and the industry's on fire except for hertz and i think hertz will be going along, pulled up by the rest of the industry. amazing consolidation here that the justice department let occur. i think you buy hertz. >> all right. when we come back, ford gets slapped with downgrade. how bill ford reacting to the call? hear that coming up. also ahead, speed and luxury mean high fashion. we'll talk to the ceos of

maserati and zegna and their collaboration. longest streak since '95. >> holy cow. >> thanks to the journal for that. more from "squawk on the street" from post nine in a moment. theo w 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. starts at 6:30 a.m. - on the (vo) rush hounose.und here but for me, it starts with the opening bell. and the rush i get, lasts way more than an hour. (announcer) at scottrade, we share your passion for trading.

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>> general electric agreeing to sell appliances u night sweden's electrolux for $3.3. allows to reshape portfolio of businesses. electrolux will use the ge appliances brand. earlier on "squawk box," electrolux's ceo spoke about what the deal means for his company. >> this, in fact, doubles our size in the u.s., with this acquisition, come bbination of existing business under frigid air, electrolux, ge appliances doubles that and that combination increases size of the total electrolux group by a third. yes, it has a significant condosolidation leverage sale effect. >> sweden's biggest u.s. acquisition since 2008. do you worry if you're whirlpool today? >> i see whirlpool down. i would not worry, because consolidations seems to be good for the remaining guys. it's lg and samsung whether they're dumping, that is a concern in that industry. i've got to tell you, anyone who

has been to buy appliances, the price wars have been endless. you're surprised when you buy a stove or refrigerator it's less than it was five years ago and more energy efficient. that's because competition, too much competition. this is a smart move for everybody. >> something else less than it was years ago, ability to borrow, of course. another story. electrolux borrowing most of the money that it will be using to finance the purchase, deutsche bank leading a bridge facility they'll replace by capital markets activity, 75% of it. and a rights issue. >> well, free money, got to do something with it. those who -- we look back and think of the companies that did something, ones that didn't, the ones that did we're going to like, including anal. >> ge, is it doing something? certainly, nbc universing no longer a part of it, appliances small, 5%, of% of revenues.

>> so, is it getting to a pure form, jim, ta you can mahat you argument belongs together or a stronger argument to be made, keep going? >> i think the key issues what they're going to do with energy. this going to be become the foremost energy equipment play? i mean, look, i've always felt they should buy national fargo, transform the whole mosaic. yes, they've got to keep going, make it easier to understand. the conglomerate stocks just don't do that. they don't. that's old style way to do things. look at tyco breakup. look at the money created when philip morris broke itself up. i was speaking with -- a bunch of people, when you get off the desk, they talk about what was liquor doing for fortune brands with furniture and golf

equipment? these things all unlock tremendous value and i think that's what people want. ge is not going to break itself up. anything to it's more edible. >> 90% of revenues from ge appliances in the country. don't buy a lebehr, a disaster. i'm trying to get a response from the company, they don't -- they don't care. they make cranes, though. >> that's like -- i bought a ge refrigerator, all in -- >> how much? >> 480. >> i have an electrolux mini fridge, works nicely. >> i did better. >> talk about the ovens after the break. >> good deal. >> cramer's "mad dash." we'll talk about the ford downgrade. more "squawk on the street" in a moment. moment. opinions. there's no shortage in this world.

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the opening bell on monday. start the trading week with a "mad dash "s. >> i'm doing an inversion, i say, what is going on? what is going on? another win for an activist. >> would icahn be there if berry's there. >> talk about how another triumph of activism. i think people have lost faith in him. >> that was a rough -- that was

a rough period there of course for a number of reasons. what's interesting about what's happened there -- excuse me i turn my phone off, sorry -- >> that could be icahn saying -- >> not going to -- you get two board seats if you're janet. one agreed to by the company, less than 1% of the company that they own. >> how is this possible? >> i think boards are responding to a certain extent early. look at hertz. now here you have activists in the stock but the board has -- is not under threat of a proxy fight. >> not at all. >> decided to toss the ceo. microsoft gave value active board seat less than 1%. you know, it's interesting to watch. on walgreen, the question is what happens now? i mean, they did not pursue the inversion. there's real questions there, there are some people who think there's more to come in terms of shareholders fighting with this company. >> craig wasson?

a billion dollar miss in estimates, extraordinary, some of the prescription business went-off line. the undertold story, larry merlot on our show, cvs is killing him. why aren't they killing him? they didn't have the big generic price cut problem that walgreens has. i've got to tell you, david, i think the combination is beautiful, my charitable trust has been buying the stock. i didn't expect this. i thought an amazing win for the activists. >> a big win. love letter to rosenstein in the journal, toop and $11 billion. the big house in the hamptons. opening bell 4:30 away. ♪

[ bell ringing, applause ] five tech stocks with more than a 10%... change in after-market trading. ♪ all the tech stocks with a market cap... of at least 50 billion... are up on the day. 12 low-volume stocks... breaking into 52-week highs. six upcoming earnings plays... that recently gapped up. [ male announcer ] now the world is your trading floor. get real-time market scanning wherever you are with the mobile trader app. from td ameritrade. you're watching cnbc's "squawk on the street" live from the financial capital of the world. opening bell in about 90 seconds. what a week is about to begin. we've got the apple event tomorrow. the president addressing the nation on isis on wednesday. draghi's on the tape. jack lew talking tax reform. twitter buy-in has stock up 2%.

>> everybody's back. >> yeah. >> an exciting time. i think that we should not underestimate the fact that alibaba's investing in companies, they fund a lot of companies, the uber competitor apparently. and then we're going to have to figure out, go back to the yahoo! issue, how can that company only be worth $11 billion? i think yahoo's! been a buy, i've been behind yahoo! a long time. you can reinvent yahoo! if you wanted to, make an acquisition. >> what's taking them so long? >> they need money. look what they've done. they've bought back more than a third of the stock over the last five years. hey, it's been a winner. i mean, i think it's -- it's like pepsico's a winner. >> you know the story on yahoo! is a winner. it's all because of alibaba. >> but do we asterisk? i don't want gains because they're from alibaba? how many -- asterisk. >> fine. but you can make an argument current management team's not

doing anything new, despite getting enormous amount of publicity. >> let's see what happens. let's see if they don't change the way. do i know something? >> i don't know. i don't know. sounding different to me. >> it's going to get interesting over there. there's the opening bell. and a look at the s&p at the top of screen. down here this morning at the big board, let's take a look who is riniging the bell, 9/11 tribute center. the 13th anniversary of that date is later in the week. over at nasdaq, canines for cops, supporting canine units and law enforcement agencies and schools. take a look at ford, down in premarket. morgan stanley downweighted from overweight. talking peak u.s. auto cycles. earlier phil lebeau asked chairman bill ford about the downgrade. here's how he responded --

>> we have a lot of new launches coming, great products, we think they'll do well in the marketplace. so you know, i feel very good about our future i'm think that the f-150, the launch is under way. so far it's going very well. we're of the canable with where we are. >> it's one of morgan stanley's nitpicking points. they think expectations are high for the changeover, there's risk and nobody's talking about what the response will be. >> i like the auto business. phil lebeau terrific. here you have this piece, talking about a lot of new innovations -- >> no apology. >> i thought lebo was going to say, the giants are going to crush the lions, you would say good luck. i think ford's in very good shape. ford europe, they got that together. ford latin america -- the last quarter was good. i think mark's a good steward of the company. the question is, i don't think the auto cycle is peaking,

because there's so much slack. >> does the evolution of auto financing not worrying you either? >> talking about being avery small part of the actual buying of autos. the thing that i worry about is that europe was getting better. that's -- that could be a ford problem. the downgrade i thought was a little -- they shouldn't have pinned it on international sales. the new aluminum, i think it's very good, lightweight is very good. that's alcoa, by the way. >> one of the best performers of the year. >> downgraded by so many between 8 and 10, constantly underestimating kleinfeld who i regard as being visionary. numbers are going to go higher in 2015 because of a new factory in saudi arabia. >> speaking of analysts' calls. jeffrey's does add google to franchise pick list. >> i saw that. >> based on youtube strength in

a growing online advertising market. the times has a piece how facebook has an advantage over youtube making videos go viral. >> great piece. beyonce piece. i think that people have to recognize that there's just the advertisers just more and more comfortable giving of the $600 billion advertising market, giving google more dollars, giving -- look, frankly what happens is, they go to their -- go to their ad firm and say, listen, put more money online and it gets spread out. you hear the same thing, my money's better spend on facebook, some say my money's better spent giving a check to google for problematic. some money in twitter. so this is just reallocation of resources away from print. i still see tv as being incredibly robust. but print, no. it makes a lot of sense to give money -- >> a record high on facebook today. >> obviously within the group, two names we started the show with, though, ones moving,

twitter up over 3%. you saw that. and yahoo! on alibaba, up almost 3%. >> well timed. >> those are the two bigger of the group that you took a look at, including facebook, google, ebay, amazon. >> this is the group that i'm most concerned about, charitable trust owns these. i think international places to sell in order to raise capital for to take alibaba. >> alibaba, as you -- as underwriters and the company is trying to establish long-term shareholders here they want you to -- if you commit to a billion dollars, there's an opportunity. that's what they're looking for. >> i know. >> you don't need too many, even for $20 billion ipo, enormous though it is. >> and they are putting a lot of it worldwide. >> right. >> you assume there will be well over allocated, well. but how it performs in the aftermarket, that size, it's you know -- >> s&p says the biggest ipo

priced in the u.s. this year, visa, 17.9 billion -- >> all time, all time. >> yeah. gained 28% on its first trade day. >> well they really controlled that -- remember that deal? community banks are so smart, they did that deal so well. i hope that alibaba understands if you want to go long term, let's everybody win at the initial. you know, let everybody mean, meaning investoinvestors. talking about customers if you're in retail that's receipt thing to say but beware. >> boeing moving on what we expect to be an order $11 billion of 737s from ryanair. >> ryanair. when mcnerney was on "mad money," look lots of orders out there. we had air leasing company say, we'll take up any slack. i'm concerned about boeing because of the dollar. because of i think that -- i think the europeans have said, all right, enough already. let's start giving our airbus a

discount by ruining the euro. haven't even started with the scots. scotland's going to -- >> deutsche's report, be avery afraid on the implications for the pound. how do you portion out the debt if this thing happens? it's going to be complicated. >> i just kind of -- i think paul krugman did an excellent piece in the "new york times" about the hazards of it. frankly, no one's thinking about this, and that's what happens. if you're in britain, you're -- are they going to keep the currency, not keep the currency? something to watch. the poll, maybe we shouldn't read too much into the sample, if you have a currency and you -- it's strong as the pound and think, wow, maybe the pound doesn't hold up, who was thinking that? wow. that was kind of a breathtaking thing. >> out of nowhere. >> touch on campbell's? 49 cents did meet, revenues

short, guidance weak, one-month low. >> they don't come in. general mills terrible. these don't come in because everybody figures it's a mat or of time before consolidation. >> a piece why campbell's is a takeover target. >> they don't come in. fixed equivalence. it's what's going on. >> watch tesla today. elon musk making comments that a possible partnership with toyota down the road is not unthink able? >> geez, maybe rethink the idea the stock's too expensive. taking up the price target. fbn represents tesla. tesla, i think has momentum. we're dealing with $500,000 car presentation we had from analyst. i think that what happens is that people kept buying tesla and say we can own it for the rest of the year because it's been a winner. when we get to september, big

mutual funds, listen, tesla, you have to be in tesla. it's been a big winner. they feel that way -- >> window dressing? >> it's hard to go to your -- your board which is quiet, it is one of -- guys have tesla, did you buy the tesla? >> we're on it. >> hey, i'll take testesla. a friend on the board of a big mutual fund. i went to the meeting and the guy didn't have intel. and they have this thing, the pentium, you know, there's kind of like the board members get involved when there's an obvious win and tesla's coming out as an obvious win. >> let's see. dow's down 15. we welcome back the long lost bob pisani to the floor. bob? >> thank you. a week in venice, wonderful time. italy, as much in trouble as it is, one of the great countries in the world. we had another record high, 57th

record high since the great bull market began in 2008, 2009. s&p at a record high on friday. it was a very broad rally. this has been a broad rally. remember, august, september, two weak months and continuing hit record highs despite fact a lot of scynicism about that. s&p, i mentions how broad the rally has been, new highs in materials, consumer staples, health care, this is not technology stocks dragging everything along. major sectors hitting new historic highs as well. i want to mention, alibaba. the terms were announced friday after the close. so it's very ripe i struggle to explain how big it is. and here's best way i found. eye appeal of the mark this year is $40 billion. alibaba's eye appeal is 20, it's 50% of the market already. more than likely, if you do 80 billion in ipos this year, alibaba roughly 20, 25% of the whole ipo market, that's how big it is. that's the best way to figure

out to explain to everyone how big it is. the big question over the weekend, will there be some big trade around alibaba? will there be some big short around alibaba? i don't know. but here's the most interesting thing that i noticed if you looked at a competitor, jd.com, they went public, chinese tech company, went public may 22nd. on that day up 10% the day it went public. other chinese tech stocks on that day, jumei, vipshop, weibo down 10 prps the%. there's definitely some kind of effect that goes on. alibaba magnitudes bigger than jd.com. whatever trade you want to set up, it's foolish to think somebody's not doing that on this day. will this open the floodgates? everybody's getting out of the way of alibaba. so will we start seeing some

more ipos coming? we just did this morning. citizens financial announced its ipo. nobody noticed it because it's overshadowed. 140 million shares at 23 to 25. everybody knows citizens. i big regional bank, based in rhode island. they're going to price september 23rd, that's tuesday for wednesday, that's three days, after alibaba. already a few days later we've got a big ipo that's been announced. answer is there's another floodgate coming i think in the very near future. one thing that did puzzle me about alibaba, other than the fact they waited until friday after the close, 60 to 66. the average ipo is 20 to 30. i think the average price is $24 $25. the signals to me i don't think they're concerned about retail trade then may be right. if you're 80% of the dotcom market in china you can afford not to worry about retailers. maybe it's not gotten the same

recognition as twitter or facebook. campbell's, they gave 2015 guidance for the first time. we are talking 0% eps growth, 2% eps growth, sales growth of 1% to 2%. this is a real disappointment there again for campbell's but that's been a disappointment for quite some time. good to be back. good to have you back, welcome back. a lot of gelato in venice. >> looks all right. thin, well-tanned. >> this morning, if you are in the risk arbitrage event business in a hedge fund, you are likely focused on comments from secretary of the treasury, jack lew this morning. at an urban institute sponsored speech followed by panels discussion in question, inversions. big headline here, despite concern that perhaps we get some sort of new proposal from secretary lew, that was not the case. tack a listen, though for key

words he did share. >> to prevent a rush of corporate inversions to get in under wire before a change in the law, legislation should work retro actively, applying to any deal after early may of this year. i want to emphasize one again how important it is for congress to solve this problem. it's imperative that lawmakers get this done. still, the administration is clear eyed about the possibility that congress may not move as quickly as necessary to respond to the growing wave of inversions. given that, the treasury department is completing an evaluation of what we can do to make deals less economically appealing and we planned to make a decision in the very near future. >> all right. the end there, of course, being the key. i mean we've heard this before, the question is what that will be, some of the instant analysis from those watching closely for mr. lew's comments, it's to

remove the threat treasury will release a proposal that would be considered sort of unknown or a wild card, if you will, many continuing to believe you'll probably see them try to do something when it comes to the ability inner company loans, key part of inversion once you invert, the company, the headquarters, so to speak, loans money to the subsidiary being in the u.s. which they're paying interest on which lowers u.s. tack bill. it's a complicated issue as we've explained many times. but overall not unexpected from secretary lew. i reference comments last week from jim woolerry, soon-to-be chairman, whose firm advised on a number of inversions, including the st. louis pharmaceuticals deal, his comments about what we might expect. >> i think there will be some activity that tries to implement

a unilateral action of some kind but i think it 4 be proposed. i don't think it will actually be they'll go straight to it. if they do, i'm not sure that it's going to withstand sort of scrutiny over time. i think they're struggle now. if there was a clean, unilateral option here we would have seen it already. >> what we are also seeing this morning, or take a look at likes of covidien, medtronic and the spread there, those enormous deals rely on tax inversions, that were there to be a retroactive change would suffer from that. you can see covidien shares are up. taking a look at medtronic. and as well shire abbvie. speaking of m&a professionals, lawyers and bankers who put these deals together they're coming. we've seen burger king recent lip i'm hearing any number of inversions on the drawing board,

typically in pharmaceutical land, but not just in that area. >> one of the reasons why, you see a campbell's, the ownership, the people from camden sold a big stake. when you see campbell's and think, what the heck, why isn't that stock down 10%, the answer is, i don't know, probably a lot of companies that want to do something in that space. i just find over and over again, every time you get negative, some deal not talking about multimedia game deal, talking about big deals that you mentioned, make me think, you leave the table and then suddenly you get a combination of the tesla/gopro mobile-i and deals motivated and you say i left the table because i heard that the fed was going to raise and, you know, going to raise 2012. >> keep your eyes open as alibaba prepares to go public with the massive ipo, we'll ask one analyst whether you should be bullish on the chinese e-commerce giant. meet the ceo who likes to be

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what a weekend of football over the weekend. of course the redskins lost to the texans, a surprise to some, but j.j. watt asked about the game after the game. the texans' defense signed $60 million deal and didn't know what to do with the money and said, quote, i googled what do rich people buy. because i don't feel like a rich person and i don't try to act like a rich person, so i don't know what they buy. i didn't really like the stuff i saw. i'm going to stick with ply humble lifestyle. >> we did pull up with j.j. watt at the white house correspondents dinner. he was one of the more sophisticated people i've ever talked with about money, as well as andrew luck, who looked okay last night. j.j. spends a lot of time

watching cnbc. and i think we'll be surprised. what he's saying is, i'm a saver. he wants to know how to save. not that i'm going to buy a house in the hamptons. he's a modest man very conscious. >> a lot of experience in dealing with nfl pros who have not handled money well over time. >> i reminded him you only need to get rich once, don't touch that money, put it in some form where when career's over -- boy the nfl careers do end -- maybe you start spending it. he was listening. our friend was suggesting, listen. listen, i watch cnbc, we can make fun of j.j., he's saying, hey, i know i've got to be careful. >> compared to hedge fund managers and private equity guys we know, he's nothing. he could -- buying a $71 million apartment last week, to add to -- you can buy a plane, some art. you can spend that kind of honey, talk to any of the guys

we know. >> i had that hand surgery. that had to do with his handshake. >> he'll be proud to know that. we will get stop trading with jim in a moment. dow's down 16. but what if you could see more of what you wanted to know? with fidelity's new active trader pro investing platform, the information that's important to you is all in one place, so finding more insight is easier. it's your idea powered by active trader pro. another way fidelity gives you a more powerful investing experience. call our specialists today to get up and running. where the reward was that what if tnew car smelledit card

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time for cramer and stop trading. >> something i've been waiting to hear. goldman sachs goes hold to buy bank of america. why? they've settled a lot of problems. people concerned with interest rates, people feel, as long as rates are so low, net interest margin is going to matter. this is one of those situations where bank of america putting this stuff past them allows moynihan spends all of his time being a banker. from the people i know involved in the settlements the ceos are -- no matter what they do, are side tracked by lawyers some actually go and be a banker means bank of america, i think -- >> he was a lawyer. >> he was a lawyer. and the best general council of all general councils but it didn't matter. paul west, the guy who you know, tony west, the guy who left the justice department was finished his job when he nailed bank of

america for one of the $9 billion in cash. but i think that this is a very good upgrade. we had a downgrade last within and didn't get that at all. tonight the ceo of biomarin. the group is so hot, we didn't talk about this, but jazz pharmaceutical, people saying that's the allergan target people want to own biotech and they ought to know what they own. because what happens is they own it and it's a one product and it doesn't get approved and you see those go down. i think this guy's the real deal. i can't wait to speak to him. we're doing defense. i think the u.s. government defense budget, we have many challenges ahead of wednesday's speech. >> by the way, "squawk" did it but congrats to the birds. nice comeback. you were tweeting, still early. >> maybe had concern, maybe scared to death.

>> jets won. >> yes. >> one ugly win as the "post" says. >> w and ws. >> thank you. saimon hobbs is back. >> open sesame, in the next hour we'll go in search of value in the alibaba ipo. also ahead, we'll take a good look at what the president said about going on the offensive with islamic state. and the ceo of maserati and zegna will join us live as they create a hundred cars to celebrate one century in business. in new york state, we're changing the way we do business, with startup ny. we've created tax free zones throughout the state. and startup ny companies will be investing hundreds of millions of dollars in jobs and infrastructure. thanks to startup ny, businesses can operate tax free for 10 years. no property tax. no business tax. and no sales tax. which means more growth for your business, and more jobs. it's not just business as usual. see how new york can help your business grow, at startup.ny.gov

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welcome back to "squawk on the street." road map begins with a road show. alibaba taking its pitch straight to investors today. the road show under way here in new york. we'll take you there live? president obama vowing to hundred down isis extremists. we'll bring you more exclusive interview with nbc news. luxury carmaker maserati producing limited edition model to honor its 100th anniversary. alibaba beginning its road show for the ipo today. e-commerce giant planning to raise up to $21 billion in

valuation north of $160 billion. kayla tausche leave where the road show officially kicks off. the ginormous one, kayla. >> reporter: yes, largest u.s. ipo ever, at least that's what it's slated to be, sar rap here at waldorf in an hour the doors on the 18th floor will open where hundreds of investors will pack in to hear the pitch from alibaba management why they should be buying into that company's stock ahead of its public debut next week. we did get details about that deal at the end of last week. 320 million shares for sale, more than a third of that is new stock. 200 millions shares from existing investors, a stat that raised i brous. you never want to buy a stock so many investors running for the exit. much of that, majority of that, is yahoo!. yahoo! is selling less alibaba stock than it originally planned

to. it had planned to sell 208 million shares. now it's only 122 million, roughly, because here's the reason. alibaba wants more of the proceeds, it wants to issue more new stock so it gets that cash and it wants to bill its cash position to upwards to 16 billion to rival facebook, amazon, ebay, u.s. rivals it wants to go head to head against for deals. an underwriter said, maybe it wants to buy whatsapp. maybe it will have the cash. it's battling companies for investors. i'm told that there is talk of rebalancing out of amazon, e bail, google, bay due, and a lesser extent smaller names like jd.com and this is a big ipo. it's going to require a lot of cash on behalf of portfolio managers, at least ones that buy. there's a lot of questions about the valuation, the strength of

china's economy going forward, and of course the company's global ambitions, where is growth? how much of that growth will shareholders get to participate in, given that so much is controlled by the company's founders and partners. it will get under way in an hour and we'll bring latest to you live when we have it. back to you. >> i was looking behind you, any sign of jack marr yet? he's the guy that everybody needs to hear from. >> reporter: he will be here help will be leading the lunchtime presentation. began at it 5:0 with a sales force meeting at citigroup and started meeting right after that in the 7:00 hour. we haven't seen ma yet. he's been meeting one-on-one with investors before the group meeting. >> we'll be back to you throughout the perhaps. kayla tausche there. does the company make enough money to justify you buying it on day one at prices that are being talked about?

bri brian nowalk. he's been able to publish a 65-page research note saying alibaba's valuation is attractive. good morning. >> good morning. >> how do you come to that conclusion? >> it's not expensive relative to growth or earnings. look at earnings power of the company they're positioned to grow top line mid to high 30s. because of operating structure they're going to put up over 60% ebitda margins. look at price to earning, you're paying 17 times earnings, for 30 plus% growth. >> it's a detailed look that you've got here. people talk about actually possibly being worth, say, 40% more than the mid price that's been quoted at the moment, or maybe they'll raise the prices as they go through the process. where do you go with those figures? >> it could. so officially in our pre-ipo we don't put out a price target or the idea could they raise the

range. they certainly could, given the top end of the range, it's only 17.5 types earnings for over 30% growth. certainly could be potential. >> more than 30% growth now. >> more than 30% growth now. >> it's obviously decelerating from incredible numbers and they're going to bump up against the law of large numbers given how big the company's getting. why do you come back to 30%? its 35. mid-30s. in a mark over the overall e-commerce market in china growing 29% and you're 80% of the market, the way to think about it is, it's hard to get a lot more market share beyond 80. so you're going to get improved monetization how you get above 3 35-ish. >> how much of a bet on growth ex-china, investments in north america or anywhere else. >> option alty. they own a big piece of shop

runner, there's no big piece of north american or ex-asia. >> m&as considered a positive or could it compromise some of the margins going forward as they've proven that they are going to have a lot more money? >> great quep i think it's one of the top questions that investors should be requesting alibaba during the management meetings. a lot of investments whether buying the largest soccer team in china or getting into film production or streaming video, they're lower margin. there is a risk to near-term margins. so you want a sense how are they making growth and profitability throughout the near term. >> in all honesty, do you have transparency to make clear calls here? a web of assets and control that i'm not sure anybody really understands where it goes. people should remind themselves that ma isn't selling assets in this ipo. they are buying shares

holding company in the cayman islands are for profits down the line. he's removed, assets from the company before without major shareholders okaying it in advance. >> correct. >> he has form on this. >> it's fair. i mean, this isn't the first time we've had adss. >> not on this scale. >> not on this amount of money sucked out of the market. >> correct. the variable interests entity structure, which is the percent that foreign holders can't own, it's smaller than bay due, smaller than the other companies. but the ads structure, the fact a lot is held in a cayman islands company, that is true. >> the board structure, the way board members are nominated, elected. that's foreign. >> yeah. >> investors need to be educated, right? >> investors -- this is why it's important to your question, is jack there. understand this is jack's company. jack has control over the board because of that partnership structure and jack is going to

control if they want to buy more company, how they want to invest, grow internationally, this is jack's company. investors need to understand that. >> good "new york times" piece on that over the weekend. >> exactly. >> nice to see you. dow's down 7 or 8 points. s&p closing at record high on friday. just avoiding a downward winning streak. the s&p of five straight weeks in a row. joining us, this david rosenberg, economist and strategist. guys, good morning to both of you. >> good morning. >> david, after the jobs number on friday, i wonder if you, like all economists are saying, that's going to get revised higher no matter what. >> i guess that's what the record would suggest. even if it doesn't get revised keep in mind that just before the number we had adp, which also has a very strong track record of its own and private

payrolls in that report were up 204,000, not 134 in the payroll number. take a look at auto sales data, consumer confidence data, the nonfarm number seems like odd man out. even if we don't see august revision the september payroll number will make up for lost ground in august. >> paul a lot of people say, all right, maybe it was weak, maybe it won't get revised higher. in a sense it's going -- it does give yellen more time to make up the fed's mind. >> that's right. the doves are in control of the fed. i think they've made that clear. so i don't think that changes much that investors had to look forward to. >> what do you think, david? what's the conversation inside the federal reserve? does it change at all from what it was leading up to next week's meeting? >> well, you know, firstly, the markets are priced for the fed to start hiking the funds rate in the mid part of next year. so, why on earth would in august

payroll report have any bearing on something that may or may not happen until the summer of 2015. so look, the fed knows how the markets are priced. if they weren't happy you'd have yellen, fisher and dudley talking the markets pricing later or earlier. the fed's comfortable with what the markets' thinking is now and there's no chance that in august or september or november data are going to move the needle on something that may or may not happen until summer of next year. so right now i think it's a lot of noise, the fed has an improving economy. the economy would have to improve far greater than what the fed is thinking to start talking hawk,ly. the base case is for the fed to move mid next year. it would take a lot for current data to spin the dial away from that at this juncture. >> it's not next year but next week we get the vote.

poll numbers show maybe voters are warming up to the idea. is that a risk to u.s. markets? i can understand the connection to the euro and the pound. how much do u.s. investors are need to worry about that? >> no, i don't think that's a big worry for u.s. investors, even if they vote against the independence, and i think that's likely still, there's a de-vol solution where london transfers more autonomy to scotland in the years and quarters to come. so, that's something that's going to get priced into european markets. it's not an issue here for u.s. investors. >> you made simon audibly gasp. >> i'm sorry. i'm really sorry. if the scott, vote for independence there are so many unknown questions about what might happen, what currency to use, whether a bank run in scotland, i just -- it's -- you know the important thing to say here is it's unlikely they will vote against it, that's the more important thing, i think, than dismissing the repercussions of

it, if it does happen. would be my take. >> no, understood. butti look this is going to taka lot of time to develop. it's going to be a two to three-year process. during that time, it's very likely that they can avoid bank runs and avoid those kinds of tumultuous problems. more of a negotiated solution in the end. i think it's going to take a while to do. >> all right, thank you, guys. see what happens over the next several days and months. next, president obama speaking exclusively to nbc saying the u.s. will hunt down ice is extremists wherever they are, outlining his plan to deal with the terrorist group. . it's the barbarian queen. . wait, wait, wait, wait, wait, wait...whoa, does she have special powers when she has the shroud? no. guys? it's the woven one the woven one. oh, oh that gives her invincibility. guys? no, no, no... the scarlet king is lord victor's son!! no don't. i told you!

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welcome back too "squawk on the street." multimedia games is soaring. the company's being bought by global cash access for 1. 2 billion in cash or 36. 50 a share. those a 30% premium to its friday closing price. shares you can seer currently up 29%. for global cash access holdings, up now offsession highs, 5%. a deal that brings together a bolstering presence in slot machines and manufacturing. >> those two go well together. president obama speaking to nbc news in an exclusive

interview on meet the press yesterday vowing to hunt down isis extremists. good morning, john. >> good morning. two big issues the president talked about in that interview with chuck todd. one domestic, that's immigration. he announced that that's going to put off for several weeks a couple 0 of months executive action he was talking about taking. said the politic of the issue had deteriorated after the child border crisis that occurred this summer. one by-product of delaying until after the election is that he's going to give the congress one more brief window to get it done. >> the good news is we have bipartisan support for that. we have a senate bill that would accomplish that. the house republicans refuse to do it. i said, if you do not act on something that's so common sense that you've got labor, business, evangelicals, law enforcement, folks across the board supporting it, then i am going to look for all of the legal

authorities i have to act. i want to make sure we get it right. >> reporter: the other big issue, the more important and immediate issue for the president right now is what to do about islamic extremists in iraq and syria. he's going to give an address to the nation on wednesday night to lay out the strategy that he said a week and a half ago he didn't have yet. the question's going to be, what sort of conflict is it? the president said, nobody should expect it's going to turn into another iraq war. >> this is not going to be an announcement about u.s. ground troops. this is not the equivalent of the iraq war. what this is, is similar to the kinds of counter terrorism campaigns that we've been engaging in consistently over the last five, six, seven years. >> reporter: now one of the questions that is outstanding, guys, is whether or not congress is going to vote to authorize military strikes in syria, which have not taken place yet. the president indicated he didn't think he needed that but

wanted buy-in from congress and both sides of pennsylvania avenue are trying to define exactly how to handle this particular sticky issue. i think the president would have concern about whether or not resolution would pass on the hill and a lot of members of congress may not want to vote for it. >> john, this morning on "squawk box," larry lindsey, obviously republican, critical of the speed of the pivot saying strategies don't evolve in five days. is that a rational concern in your view? >> reporter: well, which pivot is he talking about? on isis? >> going from -- we don't have a strategy to this address on wednesday. >> reporter: no, i think that is kind of a bogus criticism for this reason, when the president said we didn't have a strategy, what he was indicating was he hadn't decided whether to strike militarily in syria and he was lining up his ducks in a row. it's not as if he didn't have the idea for what he's going to lay out on wednesday at that time. this is -- he said for a while now that we weren't going to

have boots on the ground and we were figuring out ways to go after isis in iraq and then try to figure out how to handle syria. it's been gradually emerging i don't think it's the case where like when he said we have no strategy, he had no idea then all of a sudden he decided, oh, i have to have a strategy now. this was always in development, in the process. >> this is a little bit of a surprise, the fact that he's punting on immigration reform. i'm curious the reaction monday morning, the backlash and politics that you're hearing on this change. >> i think the backlash from the activists is not going to be all that significant in the long run. remember what we're talking about here. we're talking about an executive action in which a president unilaterally would change the legal status of millions of people. that's very controversial. some of his allies are dubious about the wisdom of doing that,

whether it's constitutional. that's the real earn because you know for 20-some years people have been looking for the next iteration of immigration reform sign into law by reagan. bush set out to pass it. i don't think there was any indication bush thought he would legalize millions of people on his own. so that's the outstanding fact. and the backlash is going to be when that actually happens, not whether it happens in september or november. >> but at the same time, john, an admission they could lose the senate through that election process. >> absolutely right. no, there's no question. this was a politically motivated shift because they were concerned about getting hammered in places like arkansas, louisiana, north carolina, where i was last week, and where the democratic conditions said i do not want the president to take this action. that's why they did. but i the delay's going to be forgotten once he takes the step, depending how broad it is.

>> john, for the moment, thank you. john harwood live from d.c. next, maserati turning 100 and to celebrate the company's producing a limited line of just 100 cars. get a first look at limited edition maserati when sara talks to the company's ceo right after this break. reak. my motheit's delicious. toffee in the world. so now we've turned her toffee into a business. my goal was to take an idea and make it happen. i'm janet long

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luxury. to celebrate 100th anniversary maserati teamed up with zegna to produce just 100 cars. and two the companies are hosting an exclusive access event to see the maserati zegna limited edition here in new york tomorrow. joining us exclusively here, harald wester the ceo of maserati. and the ceo of zegna. how's pronunciation. >> good. >> who is this car for? it's 175,000 car extremely limited edition. who is going to buy it? >> well, we believe this car is based on our all-new very

successful quatroporte equipped with ferrari v-8. the first of the maserati partnership with zegna. an interesting partnership between two italian excellences. the company shares freedom nanly all values. over 100 years of history. we are totally dedicated to exclusivity, luxury, style. and this is the first tangible outcome of the partnership. >> it's not the first of its kind that we've seen. we've seen her mez with hyundai. why do you partner with maserati? does it lead to higher sales? >> we are two luxury italian brands over 100 years old. maserati is 1914, we are 1910. >> you're fourth generation. >> fourth generation. nice to celebrate the centennial

together so it's great to partner our capabilities to come up with the end product. >> you're celebrating 100th anniversary and that has a lot to do with. how would you describe the appetite of the luxury consumer on a global sphere? >> we're pretty much satisfied how the markets are going. the u.s. recoved pretty well. to give you a couple of numbers, we are leading the registration increase saturdays year-over-year. we sold all-time record high in august. >> because of new vehicles or does it say something about the economics of the consumer demand in the united states? >> it's both. but in particular, maserati now with a new product offer real al tentative to what has been out there many years. >> do you see any impact on the geopolitical tensions between russia and europe on some of the

flows and spending. >> america is on the up, it's very important. europe is now kind of -- an influence of the russian customers having an impact. china, it's not as strong as before. overall -- >> home country, italy, is in another recession. is your leadership, your prime minister, doing enough to fight it? third resession, i think, in the last six years. >> i think he's energetic, young, but you know we have to all support him. it's just a matter of time and the situation will turn around because italian have a passion to do the right things. we just have to move past reform and deflation go back. just a little bit patient. the action to make it happen. >> good to get a check on the luxury consumer globally from

two of the best known italian companies out there, maserati and zegna. when we come back, netflix outformed s&p and returns but one of the most hated stocks by analysts. why is that? we'll talk about that after the break. e break. male announcer ] ours was the first modern airliner, revolutionary by every standard. and that became our passion. to always build something better, airplanes that fly cleaner and farther on less fuel. that redefine comfort and connect the world like never before. after all, you can't turn dreams into airplanes unless your passion for innovation is nonstop. ♪

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one hour into trading. here is what is moving on the big bore. s&p losers, start with that. commodity names up there. new field exploration topping the lisp we see anadarko petroleum, pioneer natural, energy names beat up. we continue to see the price of oil declining, stronger dollar. >> brent fallen $100. china, or for the united states, now that so much oil and gas produced here, ran that to interruption of supply. it's interesting. >> we've got winners on the lisp yahoo! david, topping that list, up more than 3%. perhaps after the alibaba was filed, more positions being taken in yahoo!. yahoo! as kayla mentioned, selling shares but not as much as originally thought. >> fewer shares than originally thought. they've pulled back on that.

the numbers keep going up. you could end up with $175 billion value at time of ipo and where will alibaba go from there? people doing the math on yahoo! wondering what they will do with cash they take in and continuing conversations about the tax efficiency of what will be left and what they could do there in terms of continued large position in alibaba. the road show beginning, what i'm hearing, just had a phone call, a lot of questions on governance, as you might expect and acquisitions which you mentioned, how man sports teams does mr. ma want to buy. >> or what else, because he has power to do it. the british pound sinking to the lowest level in ten months after the scottish independence poll signaled yes vote ahead of the referendum, first time weave seen than the story of the weekend. and the big question on the currency with the pound is, what happens to scotland if they

actually do vote yes? i know you said not a high probability event. >> the positioning here is that the market assumed automatic no to a vote for independence. what's happened here the tail risk is growing and people are saying, could like a quebec situation they reject it but reject independence but margi l marginally and therefore it kind of stays on the table what happen does it mean for business investment? what does it mean for future questions what currency they'll use, whether they'll be in the european run union on, whether a run on the banks. corporates would want to seen to be registered in the uk than breakaway scotland. we didn't think we had to ask the questions and now there's a lot of research notes coming out, analysts holding conference calls to talk through with clients. >> one stood out saying it could risk the uncertainty here over the currency a euro-style

breakup fear which we had a few years ago. paul krugman publishing, they'll look like spain trapped in the euro than canada if scotland break as way. everybody has an opinion. >> also let me mention, that david cameron, uk prime minister, not campaigned actively in the referendum because he doesn't have any mps in scotland and it could backfire. if he loses united kingdom, he as an individual is kicked out by his own party which is negative. >> also want to mention shares of ford falling after downgraded. analysts citing peaking u.s. auto cycles. something that we have heard before and that is that the chief credit fuelled a lot of the housing recovery is going to eventually come to an end. we've already gotten so many millions more than expected in terms of auto sales. maserati, spoke to him, not feeling a slowdown impact.

>> slightly different. >> the cycle of their pickup, they say expectations for the new f-150 high, people aren't talking enough about the what response will be from rivals and not sure it can be done risk-free. >> expectations on margins are high because you may be taking in this fierce pricing war you may be taking demand from the future. i think that's the argument. >> risks to north american profitability how they put it together. >> hertz announcing that mark frissora will step down as chairman and ceo of the company. of course, this is david, under huge pressure from carl icahn. said they were going to spin off the equipment business. frissora, basically built this. he dlid the dollar thrifty acquisition. >> they have yet to benefit from that the way competitors have. they're in accounting hell, restatement they haven't given a forecast.

he moves the company down to naples. some questioned that. they lost a lot of staff as a result of that. from what i'm hearing, from sources close to the board is, macdonald, originally tapped to run equipment leasing, may stay in that job. >> not just an interim -- >> he is interim now but expected to be let's call it, he has the inside track. which may be a surprise to some who expected, scotts thompson, many thought might want to be in a position to take the guy who is running dollar thrifty for them but i'm told there's a belief on the board it takes somebody who can aren't a complex organization which clearly hertz seems to have become, a lot of different moving parts and not great execution or performance of late, hence mr. frissora. and the board acting here. the lead director in particular having met with large shareholder at the very least, making their decision to move on in terms of ceo. >> meantime, some of the biggest names in the s&p some of the

most hated by analysts, dominic chu has more. >> when we look as s&p 500 we looked aall stocks that analysts have a price target on below where the stocks are traded, there are 30 stocks in the s&p 500 have that have price targets below where shares are currently trading. 30 of them, again, by more than 3% -- 3% or more. some of the big names that we're talking about. take a look. first, you've got a big name like netflix, a name that everybody talks about because it's a momentum stock, online content, a huge deal. the stock's had a nice run. $460 average price target, in terms of average analysts estimates means that that stock currently has maybe a 4% downside baked into it, if the analysts targets come to fruition. interesting stock there. take a look at this one however. keurig green mountain, they've got a huge pop after coca-cola took an investment in the company. analysts have $124 price target

which means current levels we could see shares drop 6% if target prices are not revised. interesting one there as well. take a look at this one, under armour on the athletic apparel side of things, another stock, great run, filling into the valuation now. the 69 price means possibly a 7% downside. again, remember big news, signed giselle to a huge deal. one of the worst, staples. the 11 average target price means simon that analysts think this stock could drop 12% in coming months if things don't change. some of the stocks you may want to pay attention to penning analyst revisions to their target price. back over to you. alibaba ipo fever hitting wall street as the road show begins it's set to be the largest ipo ever in the country. what are the implications for the broader market?

"squawk on the street" will be right back. are we still on for tomorrow? tomorrow. tomorrow is full of promise. we can come back tomorrrow. and we promise to keep it that way. csx. how tomorrow moves. what a day. can't wait til tomorrow.

e financial noise financial noise financial noise financial noise

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the chinese e-commerce giant alibaba kicks off the road show in new york today. for more on the anticipated ipo, let's bring in david menlo. good morning. >> good morning. >> a feast for wall street. >> let's get even scenario for people involved in the syndicate and i don't think any of the guests you've spoken with in the past have brought that up. the syndicate players slugging it away in the secondary markets and having to take stock positions they don't want to take are accumulating huge losses and this is the you better make it up to me stock. >> interesting. >> yes. >> you should explain that to people, david. i'm not sure everybody will understand what you're talking

about. >> there have been regulations passed by the s.e.c., no quid pro quo you've got to do the stocks that don't do well in or to get good witnesses but it still happens. all of a sudden investors find out they have big positions in secondaries they don't want, this is where we put a lot of our attention on a risk management and also profit censor basis. but they take losses and figure, i've got to do it because when a good stock cop out like alibaba i'm going to res y ing ting to better give me 100,000 shares. >> the bad stocks? >> as a result of this deal coming out, everything is going to be put on hold until the oxygen comes back into the room for this deal because the mechanics of what will happen next friday are going to be very -- >> sorry. let's say that they are going it raise $25 24 billion, is that sitting around or do they have to sell some of the less loved names in the space? >> economic conventional wisdom

would say you only have a limited amount of dollars so people are going to start to thin out. but that's not going to happen the day of the 18th. people are getting out in advance if they have liquidity constraints, otherwise lots of firms out there in have the capital. >> every ipo has a story, right? facebook was about mobile. talking about this on twitter, twitter was about monetization. they're saying this one's about transparency. and corporate structure. you think that's true? >> i absolutely think that's true. the valuation considerations, you just have to toss it out of the way, the discussion nobody cares about that. but you bring up the sensitive part of it. ego structure with jack ma. look at organizational chart, you need a visa to get from one side to the other, it's incredible. this guy says it's my way or no way. so yes i think the transparency's a problem. you look at it, credit suisse, an interesting thing, the lead

manager. nine years ago credit suisse did revco, imnot trying to slam them, but it was a deal tremendously successful company when private. they did it the arthur andersen issue came up, company gone overnight almost. >> that's not going to happen here. >> but concerns are valid but nobody's going to be looking at that probably for three to six months. >> end up at 175 billion value on day one or going out the door with ipo if we get to the high end and it's moved up, david, is that too high given how enormous? hard to express, bigger than anything we've seen. >> right. i think we have to go back to the days of google, take a look at what happens with facebook, twitter. all of these same conversations are like on open reel tape, they keep playing it but the earns are that the stocks all worked out. valuation considerations for let's say 40 days, when the 20 underwriters doing the deal can come out out of the quiet period

with research reports. >> are you saying, forgive me, bottom line, there's sufficient momentum behind the stock for so many reasons if you get the stock on day one buy it because momentum will push it higher. >> yes. >> that's what you're saying? >> but there has to be limitations. i'm not prepared -- >> it's a short term. >> a short term situation, the stock's going to be in every under -- in every manager's position. they have to have a representation to this. what the problem is, where 60 to 66, that's what david said, bring it out 75, 80 where demand is. i don't think it's overstretched at ipo price there will be room for the stock to move. >> does it smell look a market top? >> not at all. a singular situation. yes, there are parallels when google came out. >> visa. >> yes, when visa came out, other stocks, yes. this is not going to be the case. it is going to be a smarting ground for many more companies

that will start to file. >> david menlow? >> caller:ed the first lady of cannabis and martha stewart of marijuana, selling one of the first designer brands of pot cost more than $700 an ounce, wrapped in gold. live when we come back. come ba.

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welcome back to "squawk on the street." shares of of boeing the leading gainer in the dow industrials. the stock moving higher on news irish airline company ryan air is buying 100 of its 737 jets in a deal valued at about $11 billion. ryan air has an option to buy another 100 jets as well. boeing up nearly 2% off session highs on a day, guys, sara, when we see the dow bouncing off its session lows. back to you. >> ryan air down a little more than half a percent. thanks. our next guest has been taking the marijuana industry by storm. so much so a recent cover of ad week has her pegged as the first pot marketer. ambitious pot entrepreneur isn't stopping there. she's taking us now behind the scenes of beverly hills ultrahigh life. joining us from l.a., cheryl shuman, as she likes to be

called the martha stewart of marijuana. good to see you. >> great to see you. thanks for having me on. >> i would love to hear about the beverly hills cannibis club which seems to defy all of the stereotypes about stoners and potheads. >> well, thank you so much. i mean that's exactly our purpose. when i was first diagnosed with cancer, i was really feeling a shamed in the beginning about using cannibis as a consumer because of the negative image and stereotype and when i spoke to a lot of my celebrity friends and high-profile friends we decided to have our own farm together. we have 68 acres up north and think of it as a friendly resort we want to take on a national level. the truth of the matter is there are a lot of celebrities and high-profile people who don't want to be assigned to that negative image so as a branding and pr expert i decided to rebrand the face of the modern cannibis consumer, make it what we are today a mixture of culture and celebrity culture. if anyone has any doubt there's no doubt in my mind cannibis is

now mainstream. >> well, i mean, in california, it's just medical, just approved for medical use. do you expect this to get on 209s 16 ballot for recreational use? >> i absolutely expect california to lead the way for 2016. we consume more cannibis in l.a. county than any of the other states combined and california leading the nation in that fact will lead an estimated $47 billion industry by 2016 and i'm very proud to announce that i manage $100 million hedge fund to invest in the cannibis sector and i'm now doing a 15 citywide investment tour with green rush financial seminars matching up investors to cannibis entities. >> how do you do that? do you work with banks? q. do you have a banking partner in your business? or is this all cash? as we understand it, it's been difficult since marijuana is still illegal at the federal level, to get financing, to get help and get credit card use? >> ironically, these all private investors, angel investors.

what i like to refer to as burnsers, most of them in illegal states. there are a lot of millionaires and billionaires that consume can ko cannibis that want to strongly influence the political climate on legitimacy so they don't have to worry about going to prison and losing their millions of dollars being a consumer in an illegal state. what we're working for with this super pac and hedge fund and financial investors i'm working with we want to see cannibis legalized federally by 2016 and i'm proud to say i'm the woman leading the way and women are leading the way. >> so, cheryl, just explain this to me. is it a one-way bet, is that what you're saying? there is a liability issue here. medically we don't know nosily whether you can have a long-term illness and sue presumably and civil action against you as the leader of that investment. tobacco companies worry about the roll of the dice case. will you have to worry about the

roll of the dice case potentially? >> let me explain this to you. i'm cancer survivor. i don't worry about things. being at the front end of this and leading the way, doesn't scare me at all. i'm very proud to lead. i am a little bit of a gambler by nature. i took cancer head on and i'm willing to take this head on and lead the way and i'm willing to do whatever it takes to see marijuana legalized by 2016. not just on a united states level, but on an international level. i'm very proud of that. >> cheryl, in terms of the price point here, i can understand from a marketing standpoint wanting to go to the high end. we talk about the high end of retail every day. what are people getting for their money at these prices? unless it's just incredibly potent you must be taking people to the cleaners? >> actually, no, not at all. it depends on how the cannibis is grown, the strains, the breakdown of the chemical compounds. for example, if you're purchasing cannibis in a state where it's grown outdoors so you don't know for sure if it's clean f it's been tested, you're

obviously going to get that at a lower price. when you're working with us at the beverly hills cannibis club, everything is organically grown, all tested. you know what you're getting. we have the finest strains and it's -- i think the simplest comparison is to the wine industry. you're always going to have your over-the-counter bottles of wineries when we go recreational for recreational adult use and then you're going to have your private vendors or private growers that grow cannibis or connoisseur quality cannibis and what we do in our group like for the beverly hills cannibis club, like a wine person, you would have an expert where we pair the cannibis with the fine dining as well. my vision is to see a private dining and vaping facility in every major city of this country. some say the starbucks of pot but i think of it as a fine dining experience and with the 420 resorts imagine going to the

finest reorts ises with the finest cannibis and have a getaway retreat. >> i heard you tell katie couric you can juice it which i didn't know. we have to leave it there. the martha stewart of marijuana. >> let's change gears and send it to jon fortt to find out on what's coming up on "squawk alley". >> another great show for you. the engineers who helped launch beats are at again it. we'll see if their next headphone idea strike s it as big. alibaba, the questions you should be asking ahead of that and twitter, would you buy from a tweet? soon you can. we'll talk about what's behind it coming up on "squawk alley." your boss? yourself? your parents? your family? at baird, what matters most to you... matters most to us.

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happy monday. welcome to "squawk alley." joining us is john steinberg. nice to see you. and also slava rubin. jon fortt on set and kayla tausche up town at the waldorf-astoria where alibaba has begun pitching to investors. quite an effort kicking off today on three continents, right? >> that's exactly right, carl. new york is going to be the main event. later on in the week the executive team of alibaba will be splitting up to cover a little bit more ground. 12s plus cities nearly 100 investor meetings but today at the waldorf astoria is the main event. doors just opened. the question is how much and whether investors will be putting money to work when this company goes public next week at what looks to be a