in which financial markets have been uniquely distorted by policy making. i'd like to go back to a world where that wasn't the case, certainly. >> thanks for being here. >> thanks for having me. "squawk on the street" begins right now. ♪ tomorrow tomorrow i love you ♪ tomorrow you are only a day away ♪ >> you bet your bottom dollar tomorrow there will be sun for alibaba and scotland. welcome to "squawk on the street." i'm carl quintanilla with jim cramer and david faber. for now, the premarket is up. the dow with its first closing high in two months. a swipe at its neighbors saying apple builds great products but

not great customer data bases. >> did the fed get it right? could something have been missed. >> alibaba slated to price tonight, begin trading tomorrow. >> today the day for scotland. people there currently voting on an historic referendum that could change the uk. >> cook writes, "a few years ago users of internet services began to realize when an online service is free, you're not the customer. you're the product. but at apple, we believe a great customer experience shouldn't come at the expense of your privacy. we don't monetize the information you store on your iphone or icloud, and we don't read your e-mail or messages to get information to market for you. our software and services shall designed to make our devices better, plain and simple."

probably the most comprehensive comments on privacy and security. >> this is a feel good if you are an individual. you don't want to be compromised. i keep thinking about the blackberry. people talking about that stock going higher. >> every single major fortune 500 company. ibm brings it in. i just think apple is on a roll here. i was looking at the operating system. holy cow. >> the new ios? >> it's breakthrough. it's everything samsung has and more. everything. i spoke to the provider for the chip of samsung. they've got no mojo. >> perhaps it will be more and more about privacy.

>> a distinction being drawn to the likes of google and facebook which have different business models than apple which is in the business of selling devices as opposed to selling advertisement. >> this is a great personal field. you have talked endlessly about the forces who know our stuff. i want to have the forces to be blocked as best as possible. i mean this was reassuring to me. i use my phone. >> we are going into the weekend where the six is going to be shipped, delivered to retail. today says 10 million estimated for weekend one. that would be a big weekend. >> i believe this china canard that kept floating when the stock goes above $101, 102. they are a huge employer of

china. it's not like they are exploiting the chinese workers. so let's move on on that. >> they'll get it and it will be there soon. those are rumors simply -- >> yeah. just something the short seller has. >> exactly. >> samsung is the untold story. it's not just the ascendants of apple. when i look at that operating system. all the things i was jealous of. when they get the message at the top of your iphone and you have to scroll down. now that's fixed. they anticipate when i'm sending adam schechter from the espn insider, when i say i am thinking i'm going to play. they tell me whether i'm playing the arizona cardinals. >> you are not going to play dwyer. >> is there anybody? i'm afraid to mention anyone. >> i know. it's very difficult. the cover of "time" is about concussions in the nfl. they cannot win this one.

>> no. the nfl cannot win. >> but the eagles can 3-0. >> stocks looking to make history coming off their best gain in the month. after the fed did renew their pledge to keep interest rates low for that considerable time, transports, materials, financials, industrials all among the biggest gainers. as yellen laid out yesterday, unemployment 5.9% to 6% by year-end. could take a decade to wind down the portfolio. people are focusing on that level of descent. >> yes, but i listen to a fed chief who reminds me of my father and my grandparents who lived through the great depression and were scarred by it. she is taking historical perspective. it's still with a lot of people mentally. you remember how like your parents -- we are all different ages. they didn't ever spend again the way they did before the great

depression. they always felt that their last dollar was right around the corner. i think she is saying, for the average person, they've got -- they are not through the great recession. the rich people who are hedge fund managers come on. i am not trying to do war fare. if you have four houses, the beach house, the country house, the home mansion and the house to be named later like a player to be named later, you feel they are giving the money away. i want in and she doesn't understand the money is being given away. if you are a regular person, they are not giving you that rate. you can't get the loan. i think she is sensitive to that. i think she knows about the other 99%. she is focused on that. >> right. there does seem to be, and there are a number of commentators commenting on this. a disconnect if terms of the market reaction to yesterday.

some markets seem to be hearing something a bit different as in rates are going to move higher sooner. >> i like when the banks lead. i think the rates should be a little bit higher. her unwinding the program sounded common sense, too. >> we are talking 2020 before the balance sheet comes down to what it would be a normalized balance sheet. >> that's tomorrow. it does go by fast. >> thank you for saying that. >> if she said by the time david faber's kids graduate from high school, the program will be over. you'll be sitting next to me saying, can you believe it? they graduated from high school and the fed is out of this. >> it's down to a trillion. >> we are so far beyond it. watch the short end.

the five years at 1.85. if it closes this morning, that's the highest close since may 2011. >> yes. look. i think there were a lot of people coming to me yesterday reminding me. look, at the beginning rates go up and stocks go up. yesterday you had fedex with a fabulous quarter. you had house numbers minus 14%. you can make fun of her, but you would be wrong. >> alibaba is priced to become what could be the world's largest ipo ever. alibaba could raise more than $25 billion and let the profiles of jack ma begin big one in "usa today," crazy jack ma. >> those of us who grew up in

the era when the communist chinese were your most fearsome enemy. now building bridges and everyone wearing the exact same clothes and no one having any money. then you've got this guy. >> oh, my god. look at him. >> his family suffered at the hands of chairman mao. >> let a thousand flowers bloom. that wasn't letting billionaires bloom. you went back to the cultural revolution and this guy would be beheaded. >> if you and your family, and you're a kid going up against the culture revolution, amazon doesn't seem all that different, right? >> he would be in some camp right now being told he has to say every day, i will not have any money. i will not have any money. or his family would be -- this is a remarkable chinese story. i love that profile. i also recognize that china, people really fear china in this

country. they fear maybe there could be a war against japan. united states said we are going to defend japan. this is all like china emerging in a way that is, i'm sure is making people feel we are interior. the guy is a good business. >> when you hear him speak he talks often about culture and the culture he believes in. it does not involve greed. it involves trying to enrich as many people as possible. he always talks similar to amazon for him, the customer comes first. customer first, employees second. he is going to have a lot of those share owners very soon. we'll know where it's priced. 7:00 a.m. he will be outside, 120 members of the chinese media are going to take a selfie with jack in the back.

i speak to a lot of hedge funds. though put in for a big number. none of them expect to get near that. this is likely going to go to the larger accounts who will own it for a long period of time. where will the first trade be? a lot of people say in the $80s. it's not -- it can be sold. no lock-up. i know guys who have gotten in over the last year. you can, if you worked at it, you could get a hold of the stock from employees or whomever it was. you are locked up a full year after the ipo. not this stock. >> there are a lot of ways you can see this deal has come like

others. i come back to the fundamentals. you use 32 pe. it has 31% growth. >> 32 times forward? >> 250. 250 number. then i get an $80 valuation. that's not so crazy. >> it's not crazy at all. >> it's a little more pricey than baidu and cheaper than facebook. >> our coverage will be comprehensive tomorrow as this begins to price overnight. we'll take to you that post right there. that is where twitter went public. there is a lot of discussion they are trying to replicate everything twitter did right. >> including the pot smoking that teal provoked us with yesterday? >> we'll walk you how the ipo works down here, how the market is made and how the initial

trades begin. when we come back, susan decker, former president of yahoo who was with the company when it took that stake in alibaba several years ago. first, the uk's fate hangs on a divided scotland where people are voting on the referendum today. a live report from scotland coming up. a lot more this morning.

polls have been open for hours in scotland where people are voting on a referendum that could change the uk. polls are asking should scotland be an independent country? michelle is in edenbuinburgh wi the latest. >> today is the day to vote. this is the season when the polls opened this morning. >> 7:00, be we are now open for business. >> 4.2 million registered voters, 97 are of those eligible to vote are expecting a turnout of more than 86% to the 2,600 polling places. what we discovered consistently

talking to potential voters and voters today, the yes vote is about passion, the no vote is about fear. >> this is time to take control of our country and build a society we want. >> i don't know. i have an 11-month-old son. it's his future we are playing with here. i kind of believe in the long term uk is better in the sum of its parts. >> the pound is back up from 1.63 to 1.64. a nearly two cent move in 24 hours. we first got the polls that suggested scotland could vote for independence. implied overnight volatility doubling in the options market, 35%. that's ten times the level of a month ago. you can see a lot of people buying and selling insurance in the currency market based on the

possibility of the outcome here. >> a lot of discussion about their oil reserves. all those north sea reserves. i read today because of that, an independent scotland would be the 14th wealthiest economy on gdp per capita. how much of that is at play here? >> that is significant and hotly debate the. the pro independence campaign made it sound like that could solve a lot of economic issues scotland could mays in the future. the no camp says you are way too optimistic about what is being produced in the north sea. production has been declining steadily since the year 2000. the only debate here between the yes and no camp, does the oil run out by 2050 or 2060? that is not a long-term solution for the economic surplus. >> michelle, this is jim. when i look at what scotland wants to do with the oil, i get

the sense these are sometimes, barrels are off the coast of california. >> we have spoken to and talked to the yes campaign. they sent over their oil experts. their argument what's going on in the oil, some is difficult to get to right now in some mature fields. they feel this they incentivized r&d spending, if they said to major international iocs, come here and we'll match your r&d spending the same way norway has done, we will get better results in some of those mature fields and some of those difficult fields. when you talk to their analysts, they are a lot more cautious than politicians leading the yes campaign. analysts say there is no guarantee.

that's a core issue in this campaign, for sure. >> it's a gorgeous live shot for you, michelle, if nothing else. that fog rolling in behind you. >> it's a beautiful, beautiful country. >> you will be up late tonight watching those returns. sting, david bowie, sean connery and alan cummings are yeses as the poll comes in. >> can we go to a concert? sounds like the robin hood dinner. >> james bond says you are seceding, that could be trouble. when we return, we'll get cramer's mad dash and countdown to the opening bell. an eventful couple of days ahead. i know what you're thinking... transit fares! as in the 37 billion transit fares

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seven minutes to go before the opening bell on this thursday. time for "the mad dash." >> i have to tell you, this guidance, they blew out the quarter. the guidance is horrendous. they are talking about current estimates for reimbursement rates and lower profitability from new generic drugs. they should have seen this coming. i'm not going to say it's unforgivable. >> same as walgreen. that stock is crushed.

>> cvs, merlot, like a fine merlot. the ceo of cvs. he took tobacco out yet they are still climbing. they don't know their destiny. >> what is this about, reimbursement rates? >> they lost exclusivity on certain drugs that weren't generic. that's not good enough. i want a better explanation. this is unacceptable. it's unacceptable to say this was unpredictable. at a certain point begin what happened at walgreens, they should know better. they have to make answers. you can than say that stock went double, we cleaned up the balance sheet. i want explanations about what should have been telegraphed. the billion dollar miss. they owe us more of an explanation. >> did they give us an explanation what went wrong with

the deal, conagra? >> no. he said i just didn't do that well. but conagra delivered. this is an upside surprise. turned around in banquet, slim jim and ready-whip. these are nongrowth brands that are suddenly growing. there is talk about trying to turn around and stabilize chef-boy-ardee and betty crocker. you get stability here and next thing you know, they've got a decent balance sheet, nice yield. this is better than general mills. how about that? >> raw corp is in the rear view mirror for them? >> private label still not that good. seems like it's no longer killing them. do i want to own any packaged good stock other than white wave and hain. those are natural and organic. yesterday unfi had a good number.

i still think they are the arms dealer for white wave and hain. white wave did a great deal with good pricing on a bond deal. let's stay natural and organic and depantry. >> we've got four minutes from that opening bell. we've got a lot to watch. stay with us.

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from td ameritrade. we'll get the opening bell in 60 seconds. ahead of the day where alibaba will open tonight and the voting on scotland. you said getting through alibaba from a mind point standpoint and liquidity standpoint, that's key. >> you could say paying $100 per stock. just on earnings per share. i think that would cause people to come on air and say this is 2000 all over again. even though it's very popular. i hope the bankers try to create a pop that is $10, not $30.

$30 would make people feel like enough, i can't take it any more. easy money, it's all over. i just don't want that. >> there's the opening bell. at the big board you see the visiting nurse group foundation over at the nasdaq. celebrating its social media in compliance conference in new york. jim touched on rite aid before the break. you've got to conagra. pier one will be down to 10 cents. comps up 4-5. >> pier one takes your breath away. i liked it since it was $1 at the bottom of 2009. this is another one where they are saying -- they've been saying over and over again, online. now they are saying that is

cannibalizing offline. drive the earnings. no more excuses. no more excuses. this is multiple quarters where i've seen excuses. alex smith, you're better than that. >> wells cuts their target by $4 to $15, $16. at the same tie citi does up kohls to a buy. >> thank you for bringing out the good side. talking about pbh. they are saying that izod is behind some of the rejuvenation. they've got a loyalty program, the right pricing. i continue to leave kohls, i agree with $70. i think it goes there and i think kohls is much better than people realize. just much better than people realize. go to kohls. yesterday a guy said you are the only guy that goes to the stores with me. i said i've got a gift card.

2020, when qe-iii ends. >> jcp has been terrific. >> why? it's better than it used to be. that is a reasonable reason to own something. the beauty counter at kohls is doing better. that's where the real margins are. it's the beauty counter where all the money is really made. >> they just hit the bottom perfectly on that exit on jcp. >> have you tried the sonoma slacks at kohls? >> i haven't. >> fit like a glove. >> thank you for that. >> sounds tight. >> we get fashion tips during the show. >> jim mentioned apple and launch of ios 8. fixes to messages and mail.

new feature called hand-off where you can start reading to your phone. here is a live shot of the apple store in new york city on fifth avenue where the line is in place. people, i've been told, have been waiting since september 3rd. >> where's the line, guys? i don't see an actual line. >> that's two weeks. >> they are against the wall there. they have stoolts and sitting equipment. >> who does that stuff? what can they do for a living? i've got to get in line to the iphone. >> you could have ordered earlier. >> if you are willing to wait till early november. >> holiday season coming. >> i don't know what that's about. just don't know. >> about standing in line? >> for days and days? >> tell your kids, "i stood in line." >> it's not like a rolling stones concert. this is not 1971. >> i agree.

>> apple is back above $102. >> now they have to say that line is manufactured, it's central casting, it's actors equity, it's lee strasburg. these people are method actors. >> is apple secretly paying them all? >> it's one big act put on by tim cook and johnny odd, whatever. what a bunch of jokers. >> microsoft, it reportedly is going to be detailing some of the lay-offs they previously disclosed. we'll keep an eye out for that. we are expecting lay-off talk out of sony and toshiba. s&p may cut it below investment grade. >> there were people thinking there was going to be a major e restructure like hidden products. they have 8-tracks.

>> reminds me of my grandparents, the old cadillac with the 8-track player in it. it's nice memories. he may have a busy season. perhaps dow chemical comes before that. sony is not pretty. >> maybe there is no there there at sony. >> nothing to do to create that. how are you going to turn around consumer products, right? you can say split out film. you might argue that the whole process having the debate about it put focus on it, so the evaluation is there already. >> sometimes there is nothing to turn. a whole lot of nothing, beta max man. >> a whole lot of nothing. >> speaking of which, shld. they mentioned liquidation is the best strategy. operating the business takes $10

a share in value away every day. >> it's worth more dead than alive? >> he has been a consistent critic. he is also considered to be one of the best, right? >> we started the same day at goldman sachs. he told me about cook data services. he said get in on it. went from like $1 to $1,000. gary bolder topping number one in the accounting test in canada where he's from. just a great guy. he obviously has been corrected by shield. >> it's like the nfl shield. have to bring up the nfl every half hour. >> dow is up four days in a row. after the record close, let's get to bob pisani. >> good morning, guys. boy, we have a nice market open. all the major indices opened on the up side. all ten s&p sectors opened on the up side.

that doesn't usually happen. dow theorists rejoice. dow industrial average, dow jones transportation index. there are plenty of people. i got lots of e-mails last night that follow things like dow theory. both sitting at new highs. we are going to have a quadruple witching expiration. that will happen tomorrow. we should get bigger volume, but we are not getting a big volume push in september. these numbers have been going down for years. i've been chronicling this for ten years. it's below the average in 2014. 2013 was higher. 2012 was higher than 2013. you get the point here? we've been slowly declining in our volume since the peak which was 2008 and 2009. let's move on, talk about trader talk. i outlined some of my feelings about alibaba in trader talk this morning. this is why people are so

enthusiastic. you can't get these kinds of numbers anywhere. a company that has 80% market share in china's e-commerce. 54% margins? maybe facebook had something close to it. nobody else has these kinds of numbers. growth is continuing. one thing that is absolutely clear about the stock market, it is very hard to find growth. investors will pay a lot of money for any kind of growth and will pay big money for these kinds of numbers. a couple of secondary comments about what's going on here. this is a pure play on the chinese consumer market. forget about the economy play. i always point out the average price of insiders for ipos because it's eye-popping. average inside price here,

$2.82. remember, if the price opens at $70 or whatever it opens at or $73, when you're at $2.82, it doesn't matter. there's 128 million shares available to trade that are not locked up. that's in addition to the $320 million. there are a lot of people that could sell that might have it at prices that are only a couple of dollars. let's move on. i want to show you one other thing. one thing that might mitigate big buying out there, the indexers aren't going to be buying in a big way. it's not eligible to go in any of the s&p 500 indenindex. it's dom sil domeciled in the cayman islands. there's the big one. the eem. we don't say this, but this is index to the mmci indices. alibaba is not eligible to go into them as of now, because of

the fact it is head quartered in china and it is being traded in another country. in this case the you'd. that disqualifies them. that may change in the future. as of now, at least near term, there is not going to be anybody out buying it in big numbers fordyfo fordyfo for indices. you might see buying on that. meantime, renaissance capital ipo is the other small etf that will be buying. kathleen smith from renaissance will be with us tomorrow to comment on ipos. there had been clear sails of chinese internet stocks this month. i can't help that it's related to alibaba. in a month when the shanghai composite is up 4%. ten ipos next week. that's the big test then. tomorrow, there's the post. we are not going to be in the

crowd looking towards it. we are going to be inside, inside the post tomorrow for two hours chronicling the whole history how an ipo gets put together. get your rest. rick santelli in chicago this morning. >> there is a tale of two markets. equity market prices are going up and the fixed income treasury prices are going down. let's see the last time we are up at these significant levels. let's take the two-year note. you have to go to may 2011 before you reach this current yield around $59.

if you look at five year, comping the same period in time. this is close. this is basically the high yield of a year ago, september 2013. we certainly have intraday traded a little higher yield than that close comp on the back an extra several years. 10 year and 30 year are comping to early july. you can see we could clearly reach one of those may of 2013 type scenarios. it's hard to tell. there is still a thumb on the scale with regard to the huge size of the positions that the federal reserve holds. let's switch gears a bit. i know it was fuzzy. maybe the fed is going to tighten. they have to tighten at some point. the relative value trade is fuzzy. the two fuzzies have a big correlation. there is a big draw when it comes to the u.s. markets and the stronger dollar, evidenced

by the dollar index which doesn't include the chinese yuan, the mexico peso, but does include the following. let's look at the dollar/yen. you have to go back to august 2008 to find more significant close above $108. yes, it was yesterday's meeting that propelled us over that very important handle on our way to $110, $120. technicians are looking for a higher dollar versus yen values. last but not least, euro versus the dollar hovering at the highest levels on the side of the greenback since july 2013. back to you. >> talk to you soon, rick santelli in chicago. when we return, amazon expands and upgrades its kindle lineup. can they boost tablet sales? cameron winklevoss, why he is investing in security for your phone. i make a lot of purchases for my business.

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it's amazon's latest move in the tablets market. unveiling six new hardware devices, including a $99 fire hd, as well as its thinnest reader yet, kindle voyage. others include a $149 kids' edition which comes with preloaded unlimited. and the fire os 4 known as sangria. i think you serve at bar san miguel. >> we don't. >> how could you not have sangria? >> i have 12 custom cocktails. >> sangria is spanish, you're from mexico. >> i have 124 tequilas, the greatest selection in the city

and you come at me for sangria. what are you going to come at me next with tacos? >> almost as many tacos as amazons has kindles. perhaps as many tacos as amazon has phones left over even though they are trying to sell them at 99 cents a piece. >> what are they doing in hardware? what is going on there? >> one thing about amazon, they keep hammering away. >> no stop. >> no stop. i mentioned jack mott earlie-- a earlier. he talks about customer first. there is nobody who talks customer first more than mr. bezos. shareholders are way down his list, too. >> if he found someone who made paintball guns, would he make them an offer they couldn't refuse? >> he probably would.

>> they just keep coming with new additions. they are willing to spend the money. good luck against jack ma. better to be in the rocket game. >> although alibaba doesn't talk about taking on amazon in this market. >> no. it's never mentioned. thank you. >> they may dabble. they have users here in the u.s. no doubt about it. they dabble around the edges. >> a lot of people don't understand it's a big wholesaler and does a lot of cool stuff. >> b 2 b roots. no doubt about that. when we come back, stock trading with jim. [ male announcer ] automotive innovation starts...

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i like to get bill ekman is due. he's got a new ceo in there putting through restructuring. sounds like they are cutting unallocated expenses. we know what that means. continental resources. down badly. it's been the leader in the balkan. this is where there was a whisper. they talked about production. production seemed good. there are people who expect the world from continental and they

didn't give them the world. i don't want to draw a conclusion that continental must be sold yet. >> would you be avoiding the market today? >> no. if anyone has capital, see what happens with alibaba. $90 will be poorly received. $100 will be let's get out now, it's too high. i'm prepping that could be the talk. i think what we do is say, there is a chance that there could be a little sell-off from this. i'm not going to call it. if the dealer makers do it right, it will be the wrong thing to have sold. i don't want to hinge on the dealers doing it wrong. they've seen facebook and twitter they know the right way to do it. >> good point. >> they know what's right and wrong. let's do it right, guys. >> we should have a better sense as this day goes along as we

head towards later in the day. >> remember, $90 isn't outrageous, but it sounds outrageous versus $68. >> i'm struck by what a departure that is. i remember anchoring the special the night before facebook went public and your words were sell, sell, sell. >> this has so much earnings power, it's hard. it's so well priced. retail was overwhelmed with orders the night before. i know a lot of guys, managers in retail offices. they were in for $100,000, they got $1 million. this is the opposite. they'll be in for $1 million. that does matter. >> what's on "mad" tonight? >> i'm scrambling. i've got diebold.

they have the right security for your atm machine. have to check in with oil, continental resources. people are worried about oil. diebold, everybody is quietly worried that someone is going to compromise them. i think the atm is one of those moments where you feel like, does someone have my card? always afraid to look at your balance. did someone get to me? obviously, the banks can protect you there. they can't protect you in your 401(k). they've got a new machine that to me looks like they can make it so there is more than just your card. they find your pin number. >> do you use a mobile bank app? do you trust that? >> he told me not to so i don't. >> i don't think i've ever done that. >> not an app. no. >> you told me not to bank mobile. >> fbi guys are down on it, the cyber guys. >> i think they know more than i do.

why should i do it? he would be the first guy to say, "i told you so." time warner, they go to $90. he said, no. >> they didn't and you told me so. >> don't bust the tables too late. we'll need everybody fresh. see you tonight, jim, and in the morning. let's get over to -- we'll tease ourselves. when we come back at the top of the hour, breaking news on philly fed and market reaction. sue decker, former president of yahoo will weigh in on alibaba's massive ipo. know that chasing performance can mean lower returns and fewer choices in retirement. know that proper allocation could help increase returns so you can enjoy that second home sooner. know the right financial planning can help you save for college and retirement. know where you stand with pnc total insight. a new investing and banking experience with personalized guidance and online tools.

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to cars, trucks and crossovers. take a look at the markets on this thursday morning the day before alibaba begins to trade and the scottish referendum. dow up 62 points. dow and s&p already had a record yesterday after that fed meeting. that was the first closing high for the dow in about two months. it is riding a four-day win streak. we haven't had a three-day win streak for the month of september. keep your eye on the nasdaq, as well. it's on track for the first back-to-back weekly losses since april, as some of those momentum

names lost ground and are trying to get it back today. >> it was a mixed read from the federal reserve. janet yellen. you are seeing action cross assets. if you look at what's happening with gold continuing to sell off dramatically here in the session. the u.s. dollar strengthening at a six-year high versus the japanese yen. interesting the british pound today is having a strong day as scotland votes. >> let's get to rick santelli for breaking news. >> we are looking at september philly fed. its last read at $28 was one of the better going back to march 2011. this was less than expectation. at 22.5, it isn't a huge miss but a big drop from $28. last time you saw a number at this level, you have to go back to june this year when we had a number a bit below $18. look at internals quickly.

>> the headline disappointed, the employment component was actually a big improvement. back to you. >> i'll take it. still up 62 on the dow. >> for lessons on whether you should buy at the open, let's talk to one of the team that famously spent $1 billion for a 40% stake in alibaba nine years ago. in an exclusive interview, we are joined by sue decker, cfo of yahoo in 2005 when that deal was done. welcome to the program. nice to have you onboard. >> thank you. great to be here. >> more accurately, you also put the yahoo assets into the deal. it was another $700 million. you've described it as really the only example of meaningful value creation by a u.s. internet company in china. clearly, you are very proud of

it. >> yeah. i think there are a lot of people who worked on that deal. i think that team is excited about what happened. it didn't happen without a few mistakes at first. we built on those mistakes and it led to the current structure. >> i think that's very important for people as they try and work out whether they should invest now. the lessons you learned and the process you went through in beijing as you sought for how to play the internet revolution there. you say that it was the results of a changing views on leadership, control and trust. it was a learning process. >> yahoo started rolling out their existing site in different languages. later bought a company and had control of it. that combination didn't work. ultimately we found a team we trusted and were willing to give

up control of the company owning less than 50%. ultimately having business in china which is where ultimately the seeds of success were there. >> people buying alibaba are buying a share with a holding company in cayman islands. jack ma can do whatever he likes with this company, albeit one of the biggest ipos ever. he is the man in control. would you buy alibaba tomorrow? >> i don't know where alibaba is going to settle out tomorrow. as far as the company goes, at a reasonable valuation, one i would put away for my kids. i'm a baba bull. it probably trades up from

there. at $200 billion, if you added amazon at 150 and ebay that is not unreasonable considering the presence in china, the amount of money they earn and the amount of growth in china plus other markets that i think they'll go into. >> it's quite clear it's priced to pop tomorrow. i think that's an objective statement really. when you were doing the deal you had jerry yang next to you. everything was fine when he stayed at yahoo. when that personal connection went, we know what he did and the huge tension that resulted. who is there with that personal relationship now with alibaba for shareholders that will come onboard tomorrow? >> jack ma still owns 7% of the company. he's very invested in its future. ultimately i think -- and jerry yang is on the board of alibaba

now. you have good governance in that sense. in the long run, i think jack wants to build value. i think china as a country is trying to improve its governance. clearly, investors will probably use a higher discount rate on an alibaba than they would a u.s. company. i think that's rebound. ultimately, the growth is very, very significant. i think that it will be governed well. >> i'm curious about your take on yahoo. clearly, the stake isn't as big as it was when you first formed that relationship. what is the company worth without alibaba? that's been a boon for shares. >> my take on yahoo's valuation is there is roughly $23 a share attributable to their core business, which might be worth $9 a share or so. there is another $10 a share of cash, which is currently on their balance sheet or will be right after they sell their 6%

stake in the ipo. then they have yahoo japan which is worth about $4 a share. those three things together amount to about $23 a share. the remainder, which is roughly $20 a share if you have a $43 stock today, is this residual stake in alibaba they'll keep. what the market is saying is that that will trade around $190 billion valuation. that $190 billion valuation works out to $80 a baba share. that is embedded in yahoo today. whether to buy yahoo or not is, do you feel that baba will trade at above $190 billion valuation? that's the once to the question. >> yahoo will get a lot of cash as a result of selling its shares in this ipo. do you have faith in marissa meyer she can use that cash well and implement her vision of yahoo? >> i think the company has said publically that they are going

to return half the cash to shareholders. >> what about the other half? she'll be able to use that. >> of course. i think she will look for value-creating acquisitions. she certainly staked the future of the company on trying to get more present and mobile, which i think is a good idea. i wish her well in trying to invest that profitably. >> something that doesn't get talked about that often but was just referenced is that two years ago, of course, yahoo under pressure from activists did sell a significant portion of its stake in alibaba at a far lower valuation than we are here two years later. as one of the architects of the original deal, did it pain you watch them selling when alibaba was $40 billion, $50 billion, but a lot less than we are seeing a few years later? >> yeah. that is a bummer for shareholders. if you took current valuations alibaba is likely to trade at after tax it would be worth $40

and $50 for yahoo share. before accounting for the other $23 or $25 of other assets. it was a cost to that, for sure. >> on this larger issue of governance, given your dealings with jack ma when you did the deal, that's the one thing that comes up when i speak to a lot of potential investors. they are not overly concerned about it, but they bring it up. lack of transparency. the ali pay move outside alibaba a few years back. should that be a concern given your previous dealings with mr. ma and his management team? >> i understand the concern. i think the way business has been done in china is not exactly the same as it's been done in the u.s. i think investors will use a higher discount rate.

i have faith jack and joe and the team will run this for the shareholders. they sought a new york stock exchange listing. there are lots of reasons for that. that does require a certain level of reporting. in general, i think china as a country is moving toward better governance. there may be some volatility. in general, i would trust them. i think they are very aware of the criticism for some of the past dealings. i think he is going to try to put his best foot forward. >> before we let you go, you are on the boards of costco and berkshire hathaway. you are privy to a lot of inside conversations the rest of us are not. what is the present state of the economy? what is the cutting edge of what people are saying and their willingness to invest? >> i think the economy is doing well. employment is improving. growth is slow, but steady. you've got fiscal head winds. there are some headwinds out

there. in general from the berkshire companies to costco in retail, even to intel, things seem to be stabilizing and improving a little bit. >> thank you for your time, sue decker. former ceo of yahoo. >> thank you. is alibaba worth a $1 million ipo? one taobao villager thinks so. eunice yoon is inside beijing for that story. >> if you want to know why the chinese government is so keen on alibaba, look no further than what are known here as taobao villages. this man used to sell sesame buns. now he is an entrepreneur, generating $8 million in annual sales of camping gear. >> translator: our goal is to become the number one outdoor equipment brand in the world. >> reporter: big aspirations what is known in china as a taobao village where farmers are

trading in hoes for computers and mobile phones to sell goods on alibaba consumer-to-consumer site. in this town, 1/5 of families sell on taobao. he took orders from a 100 square foot room which he shared with his brother. >> translator: some people saw us and would think, how odd, these brothers are always working till very late every day. what are they up to? as the business grew, other villagers asked for his advice. now they buy bikes, cars and homes. alibaba does have a close relationship with the government which is good for its business here, but the question for investors is will that relationship be a drag on its u.s. ambitions? we don't know all the details of

what his expansion plans are. we do know they have an e-commerce platform called 11 main in the united states. you have to wonder if american customers will feel comfortable giving up their personal data to a company so beholden to the chinese government here in china. >> we are keeping an eye on stocks. in the green, the dow at a record high a after the fed's decision. how should you be playing stocks? art cashin will join us live here on what is going to be an eventful 24 hours in the market. when change is in the air you see things in a whole new way. it's in this spirit that ing u.s. is becoming a new kind of company. ing u.s. is now voya. changing the way you think of retirement. big day? ah, the usual. moved some new cars.

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welcome back to "squawk on the street." kohls improves shares. they up its price target to $70 a share from a prior $63. kohls up by nearly 2% in today's trade. >> let's look more broadly. stocks are higher across the board with dow in record territory after yesterday's federal reserve decision. the dow setting new highs. cnbc senior economics reporter steve liesman has more. had a few hours to digest everything we heard from janet yellen what do you make?

>> all i've been doing is thinking about it. if i look at the markets today, i see them getting different messages. stocks hearing dovish message. the data. housing starts coming in below expectations. july being revised up to 1.17 million there. jobless claims 280, below expectations. that is a good thing. economists saying that's between 175,000 and 200,000 jobs is what that means for the month of september. the philly fed coming in below expectations. the new orders and employment, some indices doing very well inside that. here what is one of the hawkish signals from yesterday's federal reserve. this is their average forecast by year, 2015, 1.375, up about a quarter. 2016, 2.87, up about 3/8. 2017 up 3.75. the long run unchanged at 3.75. what we did is a little math

here. it can start in june and get there. you have to start earlier if you want to do quarter points here. here's the fed funds future. they are below where the federal reserve is. if the fed is at 1.38, 15 fed fund futures playing below but the gap widened. yellen said she was not too concerned about the gap where the market is down here and fed expectation is up here. >> i don't, frankly, think it's completely clear that there is a gap. there are different views on whether or not such a gap exists. to the extent that there is a gap, one reason for it could be that markets and participants have different views on the

evolution of economic conditions. >> yellen said she wasn't too concerned about too dissents, the philly fed and richard fisher of the dallas fed. one person to watch in the months ahead, kansas city fed president who has been critical of fed policy and former research director for plauser. there is a potential third dissent out there. >> we'll watch that, for sure. thanks so much. to are more on all the markets and the fed, let's bring in art cashin. good morning to you. you say yellen didn't call a strike, but managed to get a spare. >> yeah. >> one of the things they call the dots, the individual expectations and projections of the members. i think what we are seeing today may be, in fact, a little bit of

an alibaba effect. you remember monday we had a heavy sell-off, particularly in the techs. a lot of people thought people might be raising money for alibaba to put projections in. not to get too inside baseball, but it takes three days for a trade to clear. sell monday to have the money by now. as these major funds in people are calling around, allocations are not out yet. if i'm a key customer and i requested a large amount, that salesman has to be sensitized enough to say, well, you know, art, you put in for a million shares. the word around the room is that you might not get that. it might be 500. we'll know better tomorrow when the full allocation. >> tomorrow is not just about alibaba. it's going to be the expiration. it's going to be crazy.

>> it is going to be enormously crazy. it has the potential. in the past, we had several september quarterly expirations have produced record volume. i don't know if we are quite up for that yet. it's going to be amazing on the opening and close. >> we didn't mention scotland but should. the bet is that it will not vote independently. the polls are close. >> the polls are awfully close. unfortunately, this morning there were a couple of rejections of the yes vote getting as high as 53%. that could be quite a shock. it will be a shock to the markets. i'm sure the underwriters of alibaba are crossing their fingers that it's clearly a no vote. >> meantime, at least for today in terms of technical levels, we are watch iing dow theory

confirmation? >> yes, but it isn't as aggressive when the dow makes a new record all on its own. that's what happens when you hang around long enough. >> we'll see you tomorrow, if not before, art cashin. up next, yes, the polls are open in scotland as voters cast their ballot to decide the future of the united kingdom. the very latest on the world's sixth largest economy and voting there. life from edinburgh after this break.

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people living in scotland are currently casting their vote on independence determining whether to rip apart the united kingdom after 370 years of union. our chief international correspondent michelle caruso cabrera is live in edinburgh with the latest and why the rest of us have chosen not to live in the uk. >> hi, simon. i heard your discussion with art. the markets do appear to be pricing in a no-vote when it comes to independence. the british pound going as high as 1.6788.

last was 1.6386. last week it fell to as low as 1.60 when the first poll came out which showed maybe the scots would vote for independence. the pound recovered as we've seen the polls shift the other way. scots don't care what the currency markets are saying. they are voting. they are expected to come out in drove. turnout is expected to be higher than 80% of the 4.2 million registered voters. they are answering one question, should scotland become an independent country. come back out to the live shot here. i want to show you this newspaper, the "daily mirror" in london. it says, don't leave us this way. here's the union jack. the blue has been removed. the blue is for scotland. that raises the question, should the british flag change? the flag institute in london, this is a group of flag o

officiana officianados say the blue should come out. >> no. there doesn't have to be a change. whatever happens will be what the people want to happen. if the people want to change the flag, then it will change. if they don't want to change it, then it won't. >> think about the implications of this. if the uk flag was to change, the australian flag, would it change? would the new zealand flag change because it's got the union jack embedded in it? we'll have lots of answers tomorrow morning when you wake up. >> who knew? thank you very much. >> can i ask you one question, michelle? do we have a definitive? if they do vote yes on independence, do we know what would happen? has there been any definitive talk about which currency scotland would have? how they would prevent a run on the banks or contain any

disaster economically? >> so, there is an 18-month period designed in the whole discussion leading up to the referendum, they negotiated a process. there is an 18-month period in which they are going to figure out what exactly is going to happen with the currency where they make the choice whether or not it's a currency union or they do they decide to get their own currencies? runs on the banks? those fears written by wall street houses, i think, highly exaggerated. i was in a country many times where they feared a run on the bank, greece, and it never happened. people here believe they belong right now to the united kingdom, and that they will at least use the british pound for who knows how long, regardless of the vote. there are a lot of members of the financial community we've spoken with here who are firmly convinced they can still use the british pound. they understand that requires having a tremendous amount of reserves if scotland decides to

go it alone. they think it can be done because the pound is a tradeable and liquid currency. >> people going to the polls now don't know what currency they will have. they don't know whether the bank of england would support the pound. those uncertainties are why some people suggested they might vote no. the scottish international party seems to want it all. i hear they are going to keep the queen. just how they -- >> they have explicitly said they are going to keep the queen. i agree, if you listen to all the promises made by the scottish national party, some can be true, the other ones can be true, not all of them can be true because if you decide you are going to keep a peg with the british pound but not be backed by the central bank of england, you have to have a ton of reserves that is expensive. you can't do nearly the amount of welfare spending they claim they will do. they can't have it all, that's for sure. >> in fairness, the uk said it's

going to underwrite uk debt come whatever so there is not a run. we have to leave it there. it's a big day tomorrow. michelle caruso cabrera. as the nfl scandal raises in this country, everybody is looking to the big sponsors to see what they will do. we did get reaction from pepsi which is one of the top sponsors. and re-upped its multimillion dollar contract. "i am a mother, a wife and a passionate football fan. i am deeply disturbed by the repugnant behavior of a few players and the nfl's acknowledged mishandling of these issues casting a cloud over the integrity in the league." and speaking of roger goodell, i know he to be a man of integrity and i'm confident he will do the right thing for the league in right of the serious issues it is facing."

pepsi not pulling its ads, we heard the same sentiment from anheuser-busch. they are certainly condemning some of the actions of these players, but not putting their money. >> they are grandstanding. they can advertise to the nfl fans and say we as corporate individuals are a little uneasy. >> and they've only seen advisers pull for the individual players. they get 17 million live viewers. that's valuable for these advertisers. one would imagine the only thing really to watch is viewership on television if that starts to erode, you might see a dimunition in value. the ratings have been as strong as ever. >> nike is pulling peterson jerseys. it's a complicated story. we are past 10:30. let's get to the nymex. >> good morning to you. we did just get the department of energy's weekly storage report on natural gas inventories. we got a build of 90 billion cubic feet. this was above expectations.

we have a bearish number on our hands here. prices did drop. 3.94 is where we are at. what is interesting, this is a weather story. we have a goldilocks situation with mother nature right now. not too cold, not too hot. we are seeing a nice build. it's above the five-year average. this is the key. what is going to happen in the next few weeks. traders are watching that total yearly build number. they are looking for 3.4 trillion cubic feet by the end of october. if we get there, they will be comfortable we are in good shape going into the winter. if not, you could see prices rise. >> thanks so much. one day away from the highly anticipated alibaba ipo. who is buying? we'll hear from one portfolio manager who is staying away.

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in just under 23 hours, the stock of alibaba will finally trade here on the floor of the new york stock exchange. while many are clamoring to get in, our next guest is worried about the company's poor corporate governance and is apprehensive. paul meeks joins us now. senior analyst and director of institutional investing at turner capital. welcome to the program. >> thank you, sir. >> before we get into the corporate government issues. it seems almost a statement of objective fact that this is priced to pop tomorrow. let's assume they don't go above

$70 tonight. with the projections somehow for the valuation of this company, it is clearly going to rally strongly at the open, isn't it? >> i agree with that. i do feel that the deal is reasonably priced when you take a look at a company that has 80% market share in e-commerce in china and has all the slices of that pie. the pie is growing and has potential to grow abroad. you have strong revenue growth. high probability visa vie amazon in the united states. i worry about this corporate governance issue. >> isn't it a latent, small tail risk at this stage? couldn't you make an awful lot of money for the next year by holding it? >> i don't know if you could for the next year. i do think the deal is going to be solid. i would be shocked if you had a repeat of what happened to facebook years ago. i think the stock will go up. >> isn't it also -- i was

talking to a ceo of one of the biggest companies on the dow jones industrial average just the other day. he was talking about their exposure in china. he said maybe one day they will do the dirty on us and we'll have serious problems with our direct foreign investment there. isn't it the nature of doing deals and being exposed to china that you have to take an increased risk, usually associated with ownership structure in order to get the outsize return, the math of how these companies can grow is so great. he could argue thought is worth taking that tail risk. >> i think that is a very good point you just made. alibaba is not the first. there are other large-cap chinese internet and tech companies that have the same structure. their comeback would be we are doing it because that's what the government regulators allow us to do. yes, i do give them some credit for that argument. however, the problem with this

particular company is that there has been a cascade of issues over the last couple of years, which make me particularly worried about this one. >> if you think the stock is going to go up and you think the prospects are bright, but worried about corporate governance, do you just buy yahoo, for instance, as a play, as so many other investors have been? >> yahoo has come up so far in price. my problem with yahoo is once you pull out the stake in alibaba and some of its other entities, i'm not convinced yahoo has much of an operating business. it's a company that came to the dance in the '90s with display ads and the market moved far past those display ads at this point. >> before we let you go, can i bring you back to the answer you gave just now. you said there were specific things that have come up recently that worried you about alibaba. could you briefly list those for us? >> sure. the deal with yahoo, which you mentioned with alipay a couple of years ago was troubling.

you have a convertible preferred offering the last year or so which seemed to be offered to select investors, a little bit troubling. jack ma is probably the most aggressive english teacher you ever met. it seems the company pushes very aggressively every opportunity that it has to do so. >> i don't know. i met fairly aggressive english teachers over the years. we'll leave it there, paul. >> thank you, sir. alibaba, one of the stories at the top of the charts on cnbc.com. you can check it all out on cnbc's brand-new app. for that let's go to the newsroom managing editor alan wasler for what's on today's "hot list" in the morning. >> yes, we have a brand-new app. you can check it out. right now the data story of the morning, jobless claims versus housing starts. number two, a pick up from "usa today," wonderful feature about

how the biggest retirement expense is actually your home. anywhere from 40% to 45% of retirement expenses go right into gardening, mortgage, insurance, that kind of stuff. number three, wonderful piece about how one in ten workers is going to work stoned. if you are not stoned and just want to get great business news, check out our new ios app. we just released it yesterday. wonderful technology. if you authentic with your cable provider, you can actually watch live streaming cnbc. also you can peruse it. you had art cashin on. always a big draw on the website. you can go to that video, hit a button on it, click and it will add to a customized play list you can watch later. people should check it out. there you go. >> are you wearing a kilt? >> yes, i am.

i'm doing it in solidarity with my celtic brothers. i've got a lot of scotch in my family. i'm not telling them how to vote. i'm just supporting their right to vote. >> people say scotland is a winner. >> i was going to say there is a lot of scotch in my family, but a different sort of scotch. >> allen, you look good. you should wear that every day. >> 90% turnout expected. might not be the last vote. allen, thanks a lot. when we come back, the former chairman of the council of economic advisors martin feldstein will weigh in on janet yellen and the fed decision. this is the age of knowing what you're made of. why let erectile dysfunction get in your way? talk to your doctor about viagra. ask if your heart is healthy enough for sex. do not take viagra if you take nitrates for chest pain...

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take a look at financials. one of the best performing sectors. >> financials, those better performing sectors, the best in the s&p this morning. boosted by janet yellen's assertion that interest rates aren't going up any time soon. still may be more normalcy

happening down the line. among the leaders, regional banks like comerica. morgan standee, citigroup, goldman sachs. bank of america. a good day overall for the financials. of course, they are always a focus a day after the federate meeting. back to you. >> thanks a lot. let's get over to rick santelli. >> good morning, carl. i would like to welcome our very special guest dr. martin feldstein. thank you for taking the time, sir. >> good to be with you. >> when mr. bernanke was transitioning out, you were the big write-in vote down here for the job. it didn't turn out that way. being the expert that you are, why don't you give me your general observations to yesterday's statement and press conference. >> well, i think they are being very cautious and yet they are communicating to the market that 2015 is going to see a significant increase in short rates. i suspect longer rates as well.

so while they haven't put a date on when they are going to start, it seems to me to be a little bess important than the fact they are telling us by the end of the year the fed funds rate will probably be in the 1.25% to 1.50%. >> let's get above the timing issue for a moment. let's assume at some point in my lifetime they are going to tighten and normalize. having said that, let's talk about macroprudential. based on the dodd frank 2010 legislation, financial stability oversight commission was created. we know that macroprudential will deal with issues of bumpy exit strategy or excesses that may develop in the system. much mass been written about how they'll deal with banks on this. what about if you are a bond funder, any other type of mutual fund or hedge fund. could you get caught up with the systemic issues should fixed

income trading get crazy considering how many positions have been long for so long? >> absolutely. these very low rates have caused all kinds of players in the market to reach for yield and reaching for yield means taking risks. whether it's the covenant light loans or the leverage loans or it's the spread on junk bonds or emerging market debt, there's just a lot of reaching for yield that could come home and bite the investors when interest rates begin to rise. >> there was talk not too long ago -- we call it balloons floated on the trading floor -- about exit fees to try to slow down anything that happens too quickly with treasury or fixed income liquidation. i know how these traders are, dr. feldstein. listen, if it comes down to

that, wouldn't that just make the rush to the exits that much more intense or an options market surrogate for selling a position? >> yes. i think so. that was one of the things that the fsoc, the financial stability group recommended. they can't enforce those things, but they can recommend it. they recommended it to the s.e.c. and the s.e.c. voted 3-2 to allow money market funds to put up barriers to exit or to raise charges for getting funds out. i think that's a mistake. i think as you said, once the markets begin to look a little risky, and there is talk about imposing those exit fees or exit barriers, anybody who can is going to take their money and run. i think that was a mistake. >> all right.

my final question. we have about 25 seconds left. how much influence do you think things going a bit awry in europe or japan, and potentially even china, could make to the notion of a fed tightening of rates in 2015? >> i think it will have very, very little effect. i think the fed is going to focus on economic conditions in the u.s. and what's happening in those other places will have very little impact on us. >> thank you, doctor. your comments are well appreciated. simon hobbs, back to you. >> thank you very much, rick. while you were conducting that interview, the s&p joined the dow at a new all-time intraday high. i actually like the editorial from the "journal" which said we'll admit it. we have no idea what yellen's comments mean about the future of monetary policy. we doubt even janet yellen does. ahead on the show, mr. wonderful. "shark tank's" kevin o'leary joins us live.

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welcome back to squawk on the street.

kroger the grocery store chain raising its dividend to 18 1/2 cents a share. up about half a percent on early session highs. >> one thing to consider before investing, does the chinese economic boom continue? alibaba depends highly on the chinese consumer and business. leland, the beige book is great. alternative to official data. what does it show in china given the fact that recently they had to inject for stimulus. >> put more in put more in and things will get better. what we've been showing the problem is loan demand. people don't want to borrow. so dumping more liquidity is the no going to do anything. these are non issues right now. >> what do you see with chinese consumer and business demand and alibaba focuses heavily on. >> we've generally been seeing a the drop in investment which is good. and everyone is talk about the

shift in consumption economy. we are not seeing that. a sluggish growth in retail. doesn't mean it can't happen. but this is a long transition at best and it is not happening right now. >> what do you think about the role of china as global supply chain which also al wab has used to its advantage and they are putting up impressive numbers. double digit revenue growth and profit growth can continue. >> china has an important role in this chain. they are not the same manufacturing heb they used to be. they are being very innovative in the way they use online sales. but it is not just 1.3 billion consumers. it's a much more complicated story. >> and manufacturing costs aren't what they used to be. when they started had whole sourcing thinking. >> a lot of people complain some of these alibaba vehicles are, you know -- had unsustainable

profit margins because they are juicing themselves at the expenses of the consumer. it's a question of whether it works in the long run. >> and china has been very supportive. the government of alibaba and its growth monopoly some would call it. is that going to continue? >> alibaba is two different companies. they are online retailer but also even more a financial company. the online retailer is now the pride of china. people love this company that is going public and generating all this interest. but as a financial services company it is competing with the banks. the banks are the politically connected and do the bidding of the state and as they have intrude odd more on the state turf they have been pushed back on. >> so bull might come back and say so china is do not if growth engine we thought. it puts emphasis on other. >> examples where al ab babb has popped up. sure that will happen. but the idea when people see it,

they see it as an innovative company and this ripe market huge for the picking. i think that is a huge question mark. >> i'm really only interested in my investments here and those multinationals that sell to china. am i okay? can i just get on with my life? >> if you are of the belief china is going to grow at the 7 1/2 percent clip going forward, then you are going to be in trouble. if you are capitalizing. >> will my investments be in trouble. where the cater pillars will in trouble. >> the new york stock exchange. >> if you are capitalizing on innovative companies perhaps like alibaba which are poised to take advantage of the shift you could make a lot of money. >> so you are telling clients to buy. >> i'm not buying. do i think the stock is going to do well right off the bat? i think so.

>> thanks. perspective on the chinese economy. >> let's send to it john forbes with a look at squawk alley in 4 and a quarter minutes time. >> kevin spacey on what's right with netflix and what he thinks tim cook has wrong about tv. also the wrinkle voss twins from social networks and talking about the privacy now. and alibaba, what do you need to know before the big day tomorrow? we'll have it coming up. we needed 30 new hires for our call center. i'm spending too much time hiring

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good morning, it is almost 8:00 a.m. at alibaba headquarters in hong jo china. it's almost 11:00 a.m. here on wall street and squawk alley is live. ♪ welcome to squawk alley. that song brings us the story of how alibaba got its name.

jack ma supposedly new the famous story because he was an english teacher. thought of the name and started asking random people what they knew about alibaba. everyone no matter where they were from were familiar and new the phrase open sesame. alibaba of course the company that opens the sesame for a lot of small to medium sized companies. great story here. the founder and ceo of business insider. with us as always john forth. and kayla has new details on pricing. >> exciting 24 hours to say the least. we're going make you wait for the spacey sound later this hour. but this is the day alibaba will price shares. that is expected to happen after the bell today. i talked to several people involved in this deal this morning and the expectation is that it will not price above that existing range. it will be within the