welcome to "squawk box" here on cnbc. i'm barack obama along with joe kernen and andrew ross sorkin. we are back at headquarters with lots of stories this morning, including one coming up about a bendable iphone. the new iphone 6 is a bit thinner, but is it supposed to be this flexible? we have that coming up later in the show. let's start things off this morning with the markets. the dow is coming off its first back to back triple digit loss. this in over three months. small caps continue to struggle. the russell 2000 is now nearly 8% off its record high back in july. down another 1 % yesterday. if you take a look at what's been happening in the markets this morning, the futures are indicated slightly higher, ever so slightly for the s&p futures. it's fractionally higher. dow futures look like they are up by about 14 points above fair value. andrew has some of the morning's top stories. andrew. >> we have corporate news this morning. pfizer now reportedly making another run at an inversion. this time holding takeover talks with activists. but "the wall street journal"

reporting that those conversations, finally ended last week after they decided against the teal. activist did its own deal last year. recently, it acquired forest labs in a $20 billion deal. as for pfizer, the u.s. pharma company had a $1 billion takingover bid for its rival astrazeneca this year. the biggest bank offering since the financial crisis, citizens financials ipo pricing blow its expected range last night. raised about $3 billion. shares are expected to start trading today at the symbol tsc. china planning to launch its latest galaxy note. apple's iphone 6 hasn't officially arrived in china yet.

eunice yoon told us just yesterday, the black market for the device over there is hot, hot, hot. >> activist. interesting. founded not that long ago. so that would accomplish the same thing for ian reed? >> yes. it's another way to do it. >> he's been outspoken on how it's like a $1 billion difference. he says we aren't doing plants, we're not doing research. we're a lot of -- and that the difference between what novartis can do and what he can do, it's a $11 billion difference. >> from a competitive standpoint. what's interesting is it wouldn't be affected by any of these changes that jack lew has proposed. >> i think he's british, isn't he? >> i think he's frustrated with the british, though. that was the problem.

>> you're in blue again. >> yes. >> different, though. >> i have a lot of blue in my closet. >> blue on the air is comforting. >> is it? >> i believe it is. warm. >> not cool. >> i think it's cool. >> no, i think red is warm. >> not on tv. i think blue warms. that's why people don't wear white shirts on tv. >> now it's your fence. >> you're the walking -- >> you got me sick. >> it's impossible to -- >> there is no one else in my household who is sick. you got sick. >> it's impossible to -- >> i'm getting one. >> it's impossible to draw definitively -- >> you're right. just because i sat next to you -- >> that's like saying every storm and every -- >> and coughing on you, you touched me, and no one else in my household is sick. right. >> we never touched. >> i probably ate a muffin after you got your hands all over the muffin. >> no, i've got the eggs going again at home. i haven't been --

>> last week -- you're not contagious now. you were last week. >> i'm not going to blow this right now. >> thank you. samsung. samsung and apple aren't the only games in town. blackberry is launching its new smartphone today. it is called the passport. the company has plans to launch the blackberry classic. that's funny, within a few months. we're going to go back to the old days. expected to have similarities for the once popular blackberry bold. >> they're bringing that back out. get me a come mow door computer and play some space invaders. >> that was an easy one. >> they're playing like a hundred people online. wall greens reportedly exploring

the sale of a majority stake. the deal could value that at about $1.5 billion. >> did you see walmart is going to start a bank? >> yeah. >> this is now like a true checking account where you can just walk in. they'll give you a checking account. it's amazing. >> it's actually a really good thing to have. so many of their customers are doing these payday loans. this is a good thing and it might be very -- >> but i wonder whether walmart becomes a competitor to the big banks. because if you think about it -- >> although some of the big banks have dumped people who don't have a lot of money in their check account. so they charge you massive fees or say you're not worth their time. there is a significant portion of the population that has been left behind. >> up about 14 points for the dow futures. >> alibaba southbound is it the signal of a near turn? >> i saw four articles about that yesterday.

>> a lot of money went into it. . >> the s.e.c. is investigating whether pimco inflated returns of its flagship etf managed by bill gross. "the wall street journal" says the probe has been going on for at least a year but is said to have picked up steam in recent weeks. regulators are looking at how the fund bought and valued its investment end bonds and the big issue is whether that process led to inaccurate information about the actual performance being given to investors. the etf, the way that they work, i don't really understand how you would -- >> there were some questions because they bought some bonds and they quickly valued them at a higher rate. there's some technical way that you can get away with it and counting. it gives the perception that the bond -- >> no, it's exchange traded --

weird. there's so many etfs that you sort of trade on those. >> yeah. you but it was the way they valued certain ponds that they bought. >> and people taking funds out already. i mean, things have gotten marginally better. would you now go buy a pimco fund? >> i'm sure the numbers we're talking about are minuscule. is an etf on fund actively managed by bill gross? don't you think he most etfs as they reflect what's going on? >> that's what they usually are. >> i don't understand this. this is weird. that is a new tie, though, i do know that. >> how do you like it? >> i like it.

>> we went to our tie people last week, right? >> it goes with your eyes. >> we have to move on. >> meg terrell is on set with us. >> there's a new projection to report. looking at the best and worst case possible scenarios for ebola. they say if nothing changes, by the end of january, cases could reach 550,000 to 1.4 million just in sierra leone and liberia. right now, the cases are doubling every 20 days in those two countries. it's terribly frightening numbers. but they lay out a best case scenario which involve eradic e

eradicating that disease by the end of january. 70% of ebola need to get into treatment centers to eradicate that disease or stop i by the end of february. of course this does not take into account guinea, which has been really, really hard hit. >> that assumes that you can get in the supplies needed to do those things. we had seen some airlines won't come in there. >> a lot of air lines have stopped flying to these countries. aid workers can't get in. building 17 hospitals, each with a hundred beds. the question is how fast can

they set those up in order to stop it from spreading. >> one of the biggest threats has been because this has gone full blown and because it's so widespread, this can be a problem that has plagued west africa for years to come. there is no way to circle the containment and wipe it out effectively. >> the world health organization yesterday coming out with smaller numbers, saying about 20,000 by november. but one of the scariest things in that report saying it could be endemic, could be a permanent problem that festers in west africa and it's a constant threat to the rest of the world. that is also terrifying. you think of something like this where it's so dire, you think you have to stamp it out. but this idea that it could fester there. and also there's the idea that people are living in such poverty, they're hunting for meat in the bush. this is where this disease comes from. as long as that persists, there's always going to be this problem with ebola. >> do you think most diseases we talk about and they're permanent diseases we deal with.

this is weird. this is like an exception to the rule, ebola, that it comes and goes like this. that's frightening, ebola, that it's out there all the time and you have to think about it. most diseases aren't 70% fatal. >> right. so you think efforts should be scaled up also in terms of vaccines and in terms of drugs. right now, we just don't have anything. the vaccinees and drugs have been tested in animals and they're just starting human testing. it's amazing to think that these would even be used in this outbreak. when we were initially talking about these drugs, we thought the time lines for testing are way too long. now we're not talking that way. the welcome trust is funding clinical trials happening in west africa and -- >> what are those numbers that are a million and a half million? what are those, have you seen them? >> yeah. 1.4 million, this is a cdc projection that just came out. by january. >> this is, what, in five

countries at this point? >> it is. although -- >> 70% of a misdemeanor people? that's what they're talking about? >> it's a high fall tallty rate, yeah. if you think about the number of people in these countries, that's a significant portion of people in this country getting affected. >> it's already in the economies where you have people in containment. you don't want people going to school or work in any of those areas. >> right. >> meg, thank you very much. >> thank you, guys. there's a new study that signs an eye popping 43% of companies have experienced a data breach in the last year. that is up 10% from the year before. it was conducted by the -- the size of the breach is said to be increasing, as well. speaking of cyber security, "the wall street journal" reports the recent breach at home depoint has triggered fraudulent transitions. criminals are said to be using prepaid cards and a range of goods. banks are stepping up trends to

stop any transactions that look unusual. home depot is reminding customers that they're not responsible for fraudulent transactions. so you'll see futures here indicated slightly higher. this comes after two days of triple digit losses for the dow and that is something we haven't seen in months at this point. also, take a look at what's been happening with oil prices. this morning, up just a penny. 91.57. you're sitting at a level where you could fall to an eight handle for wti at some point. that's about a one-day trade on a heavy day of trading if you see a swing in one direction or the other. treasuries, 10-year note yielding 2.45%. the dollar this mornings looks to be down against the yen and the pound it's up against the euro. and gold prices, at least at this point, look like they are up by about $2.70. 1,224.70 an ounce. president obama will address the u.s. later this morning.

joining us now on set is cnbc's chief washington correspondent, john harwood. john, do we know now? is it confirmed? did we get this leader of this group? >> no, i don't think so. >> we didn't? the head of korsahn was posedly, it was potentially that we had gotten him. he's not in one of the strikes? no? >> i don't know if that's confirmed, but even if we did get him, there's a lot more behind him. >> i know. but this is -- you know, that would have been a high valued target, obviously. and we didn't -- we're just finding out that it wasn't isis necessarily that prompted the quick action this time. and possibly an imminent move by this other al qaeda moving group, right? >> yeah. so we don't have details of that. the administration confirmed that they were close to being operational with some sort of plan. but, of course, they had intentions of striking isis for

some time and they were able to get sufficient coalition in their view to make the case for the world. >> they claim that he was killed. some of the militants are claiming that he was -- but we don't have confirmation? >> no. we haven't heard that from the administration. but, you know, this is going to be a long deal. it's not going to be quick, and there's no amount of bank from air strikes that it's going to solve this problem. ultimately, as the president indicated by having that meeting yesterday with allies countries, we're going to have to get them deeply involved in this. turkey, as well. here going to participate. britain is going to contranscript, although he didn't indicate exactly how. so this is going to go on for a

while. >> and you just wonder, are we effective without having -- advisers on the ground is where you want to strike? >> yeah, we're going to have special forces on the ground to -- >> those boots, they don't count? they're different boots or something? >> sneakers. >> but we've got people -- we have boots on the ground in iraq already. we're going to have special forces on the ground in syria. but the bulk of what you need to hold territory, you know, isis controls a very large amount of territory. and it's sparsely populated. that pre-syrian army, those people will be training in saudi arabia. we have to see if some of these other sunni countries can step up and make it so it's not just the united states at war with sunni extremists. >> i don't see why we can't do something about the revenue stream of $1 billion of oil those guys seem to have. can't we knock out those

facilities? >> i think we're working on it. >> because you can't do anything without money, right? >> several different sources. >> this is the first self-funding terrorist group, though, which just makes it -- >> with amazing sophistication. >> it's like the mafia is -- it's bizarre. >> tom freedman points out in the column this morning that the challenge is you've got to conspire large numbers of people who -- they don't share the tactic of isis, but they share some of the belief systems and you've got to make them belief that it's time for them to stand up against that behave and that extremist. and it's not easy. and even if you believe you've done it and train them, we saw what happened with the iraqi army. it doesn't -- it may not stick.

>> you would think it would be an easier problem once you see that isis is attacking. it's a crazy situation where it's difficult from my walk of life, to defend anything they've done. >> sure, that is true. and especially with some of these monarchies that feel themselves personally and their ruling class feels endangered by these extremists. that's -- that's why they're participating. but that doesn't necessarily get down to the root level and the visceral reaction of a lot of muslims who question exactly which side they're on. >> right. it's tough. the king of jordan, he was outspoken, but then i guess some would say he has -- he's the status quo, has a vested interest. it's almost too friendly with the west, i guess, in the view of some islamists.

but, you know, it's a real challenge for the president. the president came in as somebody who had the capacity to -- who saw himself as having the capacity to speak to the world and touch people in the region in a way that we haven't been able to do. some of that was stylistic in comparison with president obama. but some of it was about his own background. >> we are touching people a little bit different way than he intended at this point. >> yes. but the rallying part of it, the political part of it is ahead of him right now and ahead of him when he speaks to the u.n. today. >> all right. john harwood, thank you. >> you bet. up next, a second straight day of selling on wall street. back to back triple digit declines for the dow. september swoon or just a break from the bulls? we'll kick off our market discussion next.

welcome back, everybody. the dow is posting back to back triple losses yesterday since june. the dow year-to-date is only up about 3% at this point. where do the markets go from here? david joy, lou brien, david, why don't we start with you. i'm surprised that the dow is only up about 3% at this point. it has been an up and down year. i guess we've been almost treading water when you look at the dow. >> well, we've been in appear

environment where the back drop has been actually pretty benign for equities, low inflation, accommodative fed, decent growth in the economy. but there's been a lot of skepticism that we're getting closer and closer to a real change in monetary policy. i think that's kept a lot of people on edge, maybe on the sidelines. so if this market is going to sell off, i think further, we're going to need a catalyst. and it's going to have to be either that we get a hot jobs number and that brings fed fears back into play or, you know, the global economy slows down to a point where we can't realize the earnings growth that's expected. but unless one of those two things happen, this fairley benign environment can continue. >> lou, do you agree with that? by the way, are the skeptics right when they were nervous about any sort of big gains for the market? >> any sort of big gains?

>> yeah. david point the out that the skeptics have been holding things back. are they right? >> oh, i don't know about that. when you look at the bigger picture as far as the stock market goes, the last couple of years, it's gone up in a very -- to use his term, benign, very low volatility channel. and it's sort of reflective of the same thing that's gone on in the last five years, 5 1/2 years with the stock market. stocks go up during qe and stocks have trouble when qe is not around. so if we're looking for an event, it's something that everyone knows when it's going to happen is the end of qe at the end of october. and until that time, it seems that the market will continue in this sort of benign upward trend without anything exciting one way or the other. >> but you two sound like you are almost diametrically opposed. david said it would take a catalyst to bring stocks back to earth. lou, you sound like it will take a catalyst to get them to start moving higher at much more than

a snail's pace. >> well, i think that it's -- you know, i don't know if it's by design. but when you look at the way it's gone up in the last couple of years and, really, a rally that began in the -- once it was clear that the fed was going to do qe3 with the treasuries back in late 2012, this market has gone up in a steady and predictable way. and i think that it will probably continue until the end of qe, at the end of next month. now, one of the things that may be going on, he were talking earlier about the russell having some trouble lately. maybe that's foreshadowing for some trouble that the s&p, the larger stocks will experience at least at the beginning when qe ends. and then we'll have to see. i think that there's a lot of ghee quo politics. i think that the stagnant economies in europe are a real problem. but the s&p or the stock market, the larger stocks persist, i think, because of the fed. >> lou, we spoke with tom lee yesterday. he thinks we're in a bull

market, a long-term bull market that we're only about halfway through. would you agree with that? >> probably not. i don't know that i can look out another 5 1/2 years. but like i say, i think the near term hurdle will be to see what happens with the post qe environment for the stock market. you know, on the one hand, you can say that the performance of the gdp, since the beginning of this recovery, has been the worst of any performance for the gdp during that time. and you've got median income down, spending on where you look, 8% to 1 1% since before the reception began, back at 4re68s according to some reports, 1999. so i think that the majority of people, you know, are not necessarily solid as the stock market would make you believe. so even though there might be room for the gdp to move up, the fed's longer run estimate for the gdp is, what, q1 to q3.

that's not very exciting. therefore, putting the gdp, putting the economy in a little bit more danger because of the lack of growth and i think at some point without the fed, the stocks will start to react more to the economy. >> lou, david, thank you both for joining us today. it's good seeing you. >> thank you. coming up, goldman sachs chopping growth forecast for china. just how sluggish could the economic giant get? find out next. and the plaque market for the new iphone 6 in china is booming. but what happens when they find out the device is more flexible than expected? we're going to show you that and a lot more next as we head to a break. take a look at yesterday's winners & losers. (vo) watching. waiting.

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good morning. welcome to "squawk box." i'm joe kernen along with becky quick and andrew ross sorkin. popeye chicken, rolling out a new beer. a number beer can chicken. >> is it battered in beer? >> i don't know. but before you can too excited, the chicken has no actual beer. the flavor comes from a mix of

seasonings. a story in the "usa today" notes popeyes is trying to attract sales from social media buzz. >> yesterday, it was a coffee that had a stout beer flavor to it? >> right. >> starbucks, yeah, yeah. >> and shares of popeye's louisiana kitchen have been struggling over the last year. >> have you ever tried a beer battered chicken? >> i don't know that i have. i've heard identity, but i don't know that -- >> it has a beer taste to it, but apparently not in this case. cadillac is ready to ditch detroit's gm luxury car division. it's moving its hillary clinton's to manhattan's soho neighborhood next year. the company says it wants to get closer to its core consumer. most product engineering and design will remain in michigan. the manufacturing plants aren't moving, either. >> wow, i wouldn't have known

that's where they think their core consumer is. eunice yoon joins us now from beijing with a read on the economy. good morning, eunice. >> good morning, andrew. a big topic here of course is when is the economy going to recover? when is the government going to come in o to help? goldman sachs added its gloomy voice to the conversation by saying it expects the economy here to slow down for the coming years. it's cut its forecast and says it believes that the economy will slow down to 6.7% in 2016 and that from 7.3% this year. they are concerned about the structural issues here. and one of the main ones is the shrinking workforce. a lot of economists believe the government here is going to continue on its campaign with targeted measures to try to

support the economy. one of the ways that is help with the housing sector, we've heard many officials in various cities across the country making it easier for people now to get mortgages and the housing seconder is a big part of the economy. we're starting to get home buyers in to actually buy a home. one of them that i thought was more inknow vein was you could lose weight and the more weight you lose, the bigger discount you get on your home. if you buy a second home, you get an even bigger discount. another one, just to follow along, joe, your theme about chickens is that you could get a live chicken for your new apartment. also, by the way, just to adhere, i hear you guys talk about the beer can chicken. i love it. you take the beer can and stick

it up the chicken. not a live one, of course. but it makes all the meat really juicy. so it's not that the the chicken is supposed to taste like beer, but the chick is -- you know, you're cooking the chicken and it's becoming much more flavorful in the way that you're heating it up. >> learn something new every day from eunice yoon. i'm not sure what you just said, although i'm visualizing. you're pouring the beer -- >> no. >> you take the beer can -- >> what does she mean -- >> you stick it up the chick.. >> why? >> you're not -- >> go again, eunice, what? >> so you take the beer can. either you open it up or put a lot of holes on it. you stick it up the chicken. it has a -- >> that's the part i'm talking about. >> you stick it inside.

then you cook it and the beer starts to come out and it flavors and -- >> i think you do -- >> no, the can is -- >> the can is in the chicken. >> the physical can? >> why do you not -- >> yes. >> why is this interesting, andrew inspect that's the reason this is interesting. >> but i thought i misheard. >> is the chicken opened up or do you find an entry point on the chicken? >> well, the chicken has a natural entry point and you take the beer can and -- >> i can't believe you just said that and i can't believe people are doing these things. okay. >> wait a second, i've seen you stuff a turkey. >> but that was the neck hole. it wasn't going up its -- >> no, yes, you were. you don't even know what you were stuffing? >> that was the posterior? >> yeah, it was. >> eunice, you just never know, do you? >> we should thank eunice. >> pretty sure. it's a unique culinary ask him

skill to be able to do that. cans are pretty big. these are all the parts i'm thinking about. you have to use some force, apparently. >> causing tension. >> i did. eunice yoon in beijing this morning. >> i convinced myself that she meant that you were just pouring it up a chicken. >> how do you pour it up the chicken? >> well, i didn't know. this is getting way out of hand. you better get going. >> eunice, thank you for the report, the chicken, the beer, and everything else. the fun is over. china data taking center stage this morning. in a operate survey from -- chinese international is still experiencing sluggish growth. here with us is leland miller. can you beat ta? do you have anything to say about chickens? >> no, we can't compete with

beer basted chickens. we're seeing the same type of things in the last year and a half. it's a lot less anything. >> than the chickens? you have nothing? the segment is going to be boring, is that what you're trying to say? >> can the chinese economy is never boring. the fact that it's not going to happen and people are starting to realize this, even goalman sacks, apparently, that's interesting to me. >> how bad is it going to be? >> look, it doesn't have to be real bad. what people have to unis the economy is going through a broad based deceleration. it's been for the last about two years and will continue to be so. and this idea that it's just about changing the misallocation of capital, then the economy will jump start again and go back in the stratosphere. >> what does the bottom look like, then? >> the bottom looks one of two ways. if they do it right, they would form and restructure the

economy. >> how long will it take? >> they do it over the course of the next focus years. regardle regardless, it's slowing down. if they do it bad and the economy starts dissent grating out from under them, then it also slows down. >> but when goldman sachs says they think it's just too much debt, are we talking about a true financial crisis? >> nobody really knows the level of npls. but we didn't know them a year ago and we know they're still is too high. people are feeling worse about the u.s. economy. they know something is wrong. it's been building up for years and years and years. >> you point out that it's not showing up in the real numbers. yesterday, that manufacturing number was better than had been expected. it was up slightly from the previous reading. do you think they're mixing the numbers or cooking the numbers here or do you think it's just something behind the scenes?

>> no. the pmi is something different. pmi is run by hsbc. people think the manufacturing index is a bellwether of the economy. they think china is a bellwether of the economy. we've shown over the last two years that manufacturing is performing counter cyclely to the economy. so this idea that you can wake up and check the china manufacturing gauge and see where china is going, it's wrong. it's been wrong for a long time. it's important to look at the multiple sector and then the credit environment, you can understand it's not just one proxy. >> sth is not as exciting at chicken and beer. why is everybody so crazy about the iphone in china? >> prestige. they can't get it. >> how big of the black market is this? are we talking about hundreds of these devices, tens of thousands? >> who knows. but if you went to the grand

central store the other morning, you had crowds lined up, a lot of them chieb owes because i could hear the mandarin. people are coming over here just to get the phone. >> they're flying here to get the phone and take it back? >> looks like it. >> leland, thank you for joining us. next time bring us some battered beer. >> a lot of people are writing in, it's not battered. you stick the can up the chicken's rear. okay? >> loud and proud. >> a lot of people are writing in, i can't believe you never heard of it. it comes out really good. it's not nearly as much of a violation. it goes up there pretty easily and it is done. there's a picture. someone sent in a picture of it happening. a chicken is larger than you're thinking and the beer cannot is not that much bigger than -- >> and you make holes in the can? >> she said you can make holes in the can. this person says basically the chicken sits on the beer can.

it's not alive. basically it's plucked and everything and it's opened up. but, you know, you really resist today whole notion. i'm not really sure. >> i -- >> you told eunice that it couldn't be true. >> now i am. >> you're making leland uncomfortable. >> you don't stick a big can up there. so we should get a little -- i was really not supposed to pack this stuff. you're supposed to just gently put it in there. when we come back this morning, china's sluggish economy being blamed for the steep drop in sales in whiskey. and what one of the leaders is supposed to do to stop ply. that is the new iphone 6/. the question is is it supposed to be that flebsble? we'll find out when "squawk box" returns.

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welcome back, everybody. apple fans were excited to get their hands on the new iphone, but somehow some are finding the display might come with a tlau. the display seems to be prone to bending. users have posted pictures online. no word on if the problem is widespread. it's not the first time rappel has had problems with the launch of a product. you remember iphone 4s. you can say the same thing about every new release of every infrastructure we've ever seen. i don't know what's wrong with

that unless it breaks when you bend it. >> i don't want my phone bep bending. >> stop stickeling it in your pocket and sitting on it. >> you need a case for it. if you're going to make it thin, you have to make it so it doesn't bend. you have to put some kind of -- i don't know. >> i think you need to give him some instruction. >> i liked that it was so thin. it made it much lighter. >> you don't want it bending like a credit card in your pocket or something. >> then it could snap in two. >> every technology, i never buy the first release of anything. >> it's a six. does that not tell you there was a one, two, three, four, and five? >> do you ever buy something within the first couple of months of it? that's a rhetorical question, obviously. >> he waits years, decades sometimes. u.s. whiskey, off 40% in

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i lovp love scotch. i love scotch. ♪ >> okay. let's do talk about scotch.

global experts of scotch wis ki down 11% of the year, and they hope to splash in the u.s. market with a new $300 whisky called mckellan rare cask. it launches here in early object. we have the president and ceo of the parent company of the brand, and thank you for joining us. we talked off camera, love your accent. you have seen things like this in the past where beer and wine come back, hard liquor comes back, and there's cycles. this is worse. is it political correctness of the world at this point, or why aren't people drinking hard alcohol? >> there's very much a cycle. i lived in china, and this is not the first time we've seen cycles in china, russia, political reasons at the moment,

and there's a downturn in markets like brazil, which were up and coming in the large scotch markets. what happens is the stocking effect through the world up until about 18 months ago, there was a shortage of scotch perhaps on a global level. now, that's balancing off. the corrections are probably healthy in the long run. >> you mentioned politics in this. russians are not buying it for political reasons. chinese are cracking down on corruption. is that another part here? people are not gifting. >> yeah, gifting and toasting and the business entertaining in asia is a large factor in the scotch industry. i mean, the markets like taiwan, hong kong, and singapore markets are performing well. and one day is an absolute gorilla in the market, but take the long view, ten to 20 years.

that's how we look at it. >> how do you become a scotch aficionado, and how long -- i've tried, i tried. i want to order and pretend i know what i'm doing, to order a good scotch, but when i order it, i think i have to have five or six of them before i like them. i'm, like, not very sophisticated in terms of scotch. how do you do it? is it the taste that people really like, or, you know with some alcohol, it's a different feeling that you get with like yeager, not a good one. >> yeah. >> is it a different type of glow that you end up feeling or the taste that people, as someone who knows, tell me. >> i'm not calling myself an aficionado, but this is craftsmanship to a certain

extent. you know, the whisky makers put this together as an art design rather than a scientist. sometimes you can say it's app acquired taste. >> it is, yeah. >> i think, you know, i would not acquire it if you don't want to. there's great products in the market. scotch is the go-to category globally whether you're in nigeria, south africa, whether you're in russia or chile. it is the -- >> not bourbon or gin? >> not big in asia. not big in africa, so it is a global brand, if you want to put it that way, which is really a go-to for status in some cases, in asia, africa, and in terms of quality, it's at the table here within the united states. people drink what's in the glass. >> single malt versus a blend, there's a difference in taste? >> certainly. we are talking about a small batch production process from a

single source. a blend, good, put together from 25 distilleriedistilleries, and in the blending of it thank the cask management. >> what do you think about the scottish vote to stay within the u.k.? >> i think it's, you know, our official line on this was, you know, as a market for the people of scot land, they made a clear decision on that at 5 5% to 45% to stay in the union. from a business perspective, there was a lot of uncertainty, membership of the european union, access to embassies, visas, double taxation treatiet, that type of stuff. in the end, it removes uncertainty for us, and it's gone with the job of growing the business over the next two or three decades. >> okay. >> okay. appreciate the time. do you think the euros have a chance in the ryder cup? >> i have a house 15 minutes from it, but i'm here. looking forward to it. >> good to see you.

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as the world turns, prauchl set to address the u.n. hitting targets in syria and iraq, is the global economic recovery in jeopardy? >> the ebola epidemic, the projections are frightening, 1.4 million cases possible. is the rest of the world doing enough to keep the the disease under control. >> no one lives forever, but is 75 long enough? a doctor on why he hopes to die at 75. second hour of "squawk box" begins right now. ♪

good morning, everybody. welcome back to "squawk box" here on cnbc. our guest host for the next two hours is legendary hedge fund manager, kyle bass, welcome, great to you here. >> thanks, great to be here. >> thank you for joining us. you talked about beer can chicken. well, this is what we're talking about. take a look. this is the chicken on a stand that has a beer can. yeah. there you go. >> i don't understand this when it was explained, but now that i have the visual -- >> at this point, i think there's a question as to whether the chicken ingested the beer can and this is the result or whether he just sat on it. >> yeah. >> so the chicken did not eat -- they'll eat anything. okay. people do this. they have a brace where you can put it on and a lot of people have written in that it's really

good. people do it. >> yeah. >> that is the end we're talking about, you can tell for sure? yeah, nose are the wings, the legs. >> there it is. >> okay. let's talk about business news this morning. in an active week for the housing market. getting more this morning. the government's out with new home sales figures for august at 10:00 eastern time, congress there looking for a 3.9% increase from july, following moptd's existing home sales report. out from the mortgage bankers, applications fell 4.1% and mortgage rates edged higher, the bulk of the drop was a decline in refinancing activity. a data breach at home depot is triggering fraudulent transactions in the country. last week, the chain said that 56 million cards may have been exposed to the breach, but this morning, it's reminding customers they are not responsible for any fraudulent

charges. it won't get quite the attention the iphone6 did, but blackberry has the newest mo e today, the passport phone today with what launch events are scheduled. i don't think that was the im e image. it's a square device, looking different than others we've seen before. samsung is debuting the smart phone in china and south korea this month meaning it will beat rival apple to the chinese market, although, the latest iphones, of course, are a hot item on the black market. we have a lot about that in the last 48 hours. >> the world economic recovery remains weak, but the u.s. maintains its role in the business cycle. that's kooring to the report today coming as the u.s. markets are finished in negative territory yesterday, a couple of rough sessions in the last

couple. worse in two months. we have larry canner, head of research at bar ji clays. been awhile, but happy to have kyle bass with us today, principle of hayman capital management. i have to start with you, kyle, in terms of opportunity to, you know, make big scores and big hilts and do things that trend and do well for the business, is it the u.s. where you think we have opportunity because of things not understood or other places around the globe, japan, south america, places like that. where are you really excited about things that people are missing that you can capitalize on? >> so, that's a great question. i think in the global landscape where the opportunity is over the next 12 months and little further are mostly japan, argentina because you have really something that larry's

piece that i've seen says. it talkings about how the u.s., the training wheels are coming off the market. we had negative real rates for 6.5 years, emergency stimulus levels, interest rate levels for six and a half years, and the fed's gout to come out of the market by the end of october so interestingly enough, the world's a multivariable equation, but if you can distill it down to a couple variables, the fact that japan's quantitative easing program has to accelerate and their currenting the's going negative and 10% fiscal deficit all at the same time while the u.s. looks fairly robust and it's pulling out of the market. you have one pulling out, one going all in, and that provides a huge opportunity if people are paying attention over the next 12, 24 months. >> talk about how you would maneuver that opportunity, and we want to talk about, you know,

the exit that the fed is going to make. who knows, it's unchartered. who knows if they can maneuver that well, and unemployment could continue to drop, but the economy might not play along with the fed to the point where they feel comfortable raising rates. >> yeah, come on, look at up employment. the way it's calculated, it's semirigged, right? it trends down to the 5% range just because people stop looking for a job. take everyone that dropped out of the work force since the beginning of the financial crisis, you know, the unemployment number is 11%. >> we feel 5%, but the economy gives us 2% growth, so by all indications, the fed should be 4% on fed funds, but given the economy, stay at 0. it's like a conundrum for them. let's get larry involved. larry, you know, kyle -- that's high praise coming from kyle. what did you write about? >> yes, so the focus now, i

think, should be on these regional disparities. if you take a top-down look at the global economy and global markets, not a lot has changed. we have a weak economic recovery, monetary supports extraordinary, risk assets like stocks in high yield bonds perform well. inflation in bond yields are super low, but something is happening. i think i'd start with the ecb. what's going to happen there is truly historic. we know about historical institution. for the president of the ecb to come out and quote for fiscal stimulus, focus on labor market conditions, and announce what amounts to a 50% increase in their balance sheet i think is ground praek ibreaking, and the have to buy government bonds, in other words, resort to conventional qe so i think this is a little bit like what we saw in 2012. remember, we'll do whatever it

takes, and that really calmed down the european debt crisis. i think you're about to see something similar here, and i think the big market implication of that is you're going to see a further drop in the euro. we've seen a big move, but i think you're going to see a lot more. i mean, a euro at 128 or so is not that low. remember what it was? it was well below 1 at one point. the trade dollar is weak even after the rally, and you get the fed going the other way here as we just discussed. i think you're about to see a big move in currencies here. >> you know what's interesting, kyle, you said we're facing the moment where one central bank is moving out, another moves in. you did not mention opportunities in europe. it's not necessarily going to help? >> i agree with larry. i think the euro is a funding currency like the yen, and the dollar is going to be something that i think this is the beginning. we've seen a big dollar move in the last six months so i think it's literally the beginning of something that is going to be difficult to stop for a while,

and that adds implications for multinationals that you've seen, that sell, and other currencies, and i agree with larry that the opportunity right now happens to be in the currency market place. both the euro and the yen. >> so, okay, so in terms of what you see with the fed here, you're not looking at -- you know, i listen to larry, wow, it's great, japan's printing money, europe's printing money, buy bonds, and it's going to work, and everybody --'s woah! did you see that? >> joe, we're not saying it's going to work. >> it just seems too pat, too, you know, like things like when you bet on things like that, they end up going -- that's not where the opportunity is, to bet on mistakes of central bankers? >> well, there's short term and long term. in other words, you know, we've seen the nikkei move up a lot,

and, you know, there is -- it seems japan's being successful in terms of eradicating deflation. look at the u.s. and argue how much qe helped. it helped the markets, pumping liquidity in there. does that mean companies are worth more in the long term? not necessarily. this does -- this divergence in monetary policy is going to be -- it dramatic, and the fed has not started yet and either is the ecb. p it will be more dramatic. >> the euro, and short the yen? >> i think the dollar, just as kyle said, it's a reraiding of the u.s. dollar. the fed led the world in easing, and the dollar got weak. now the fed's going to lead the world in the other direction at a time when the ecb in the other direction and japan pumps up money. look at currencies, as kyle

said. in terms what does it mean in relative stock markets, it depends whether it works. in other words, if you see in europe growth and inflation move up, less euro depreerksz and stocks do better in europe. in the near termings there's cometed stagnation there in terms of the euro economy and it's dangerously close to deflation. i think you get more of the action on the currency side. >> you worded it -- you think yellen doesn't start or needs to type more quickly than she thought? >> i agree with the prior comment. i think that if we were to go back to, quote, normal rates, we'd be fed funds, you know, four, four and a quarter. i don't think we can afford that, right? with every hundred basis points costs us fiscally $150 billion in interest, and, you know, this grand bargain that the various constituencies in d.c. tried to achieve was, what, a trillion dollars over ten years. we're talking about $150 billion a year, right?

i don't think they can do it. i think that when they start raising the front end, maybe q2 next year, the front end coming up to where the dots are as far as the fed's concerned, but the back end is not going to move. >> tell me again, how much -- what causes 150 billion? a hundred basis points did you say? >> yeah. >> the fed funds, go from 0 to 1, 1 to 2 -- >> you say -- basically add about 150 billion of interest expense to the federal government. >> you're to the taking into act the 20 billion we save on inversions now that we fixed that. i mean, is that going to help at all? >> these are big problems. >> it's a rounding error. >> it is, right? these are big issues. it's frightening. it helps us repay debts if we are paying at 0% interest rates, right? >> it does. >> if you have a strong dollar. offsets -- >> that's not the game plan. the game plan is weaker dollar,

pay off the debts, and weaker currency, and more importantly, if we were going to export our way out of that, that's difficult. you know, we've already really shored up the capital in the banking system. europe's trying to do that through basically extending the time in which they have to restructure. >> at the top, i asked you see opportunities in other parts of the world when we have a huge economy, i would think that maybe dislocations we grew here would be a huge opportunity, but it doesn't seem like this is where you necessarily. to play. it's more interesting in japan? >> the majority of the capital is invested in the united states. >> in different situations? >> where true opportunities are today are what larry's talking about the the divergence in monetary policy. it's been homoginized in the financial crisis, and the training wheels are coming off

the market. to invest from a macro perspective, realize where the policies diverse and apply capital there. i think that's where it is. >> think about where -- larry, thank you, kyle is with us for the remainder of the show. coming up, our guest host, kyle bass, very well betting against the housing bubble. is thereto ie bubble forming in housing? his view after the break. plus, find out why mark zuckerberg is ticking off the neighbors. he's not getting many "likes" on the latest product. all about it in just a moment.

>> there's a $10 million fixer upper, and now the sfrisz chronicle reports that this neighbors are not happy with the massive construction. it's any now in the 17th month. he has at least ten permits for work on the property and making the fourth floor legally habitable. the new basement is putting in, a garage with a turntable pad to make it easier to get cars in and out. >> if i was zuckerberg in san francisco, i'd buy the island, alkg traz, raise the entire place immediately, and put up a

place, 10 million? are you kidding me. that would be my gym. just take alkatraz, the island, and put up a branson thing. >> because you like people. >> yeah, because i like people. i like people, no one can get on, nobody can get off. >> this turntabled idea in the garage? >> people have had those. >> turning around. >> but ten million for zuckerberg? >> it's a fixer upper. >> pretending to be one of us? >> still drives a car -- what is it? it's a cheap car that he drives. trying to be a normal person -- sort of. >> well, he can't. okay, the guest host made a name by predicting and betting against the sub prime housing bubble and netting himself a tighty sum. she still playing in the market, and where does he stand? kyle is here, and a where do you stand on housing, what are you

doing? >> so, we think housing rebound pretty nicely, year over year, up 5%. it's not the double digit gains seen in the last couple years, but it's normal. housing, in my opinion, normalizes to where median income is, and the prices are at 220,000, up 5% year over year. we, in our investing focused on one sector, the nonbank mortgage services sector where the rules for the banks require banks to sell nonfloating loans and emergency services assets and measuring srs. >> are banks good investment, by the way? >> i don't own any of them. capital standards are going to be tougher. regulations a lot tougher. >> right. >> and i think that -- i don't know, we don't don't own banks, not huge opportunity there. >> the macro, in the kmerl break, talking about the fed before the break, and your thought on the fed's policies

and what it's done to quality or income inequality in the debate. responsible for more or not? >> i think it's proven itself to show it's widening the gap. it's paradoxical the administration talks about narrowing the gap, but yet the treasury's policies or regulatory policy is distributive, and i don't think it's a point that's discussed too often, but it's -- i don't have one rich friend that is less rich today than he or she was in 2006 before the crisis. >> like the democrats hate trickle down when it's, you know, when reagan talks about it or when we raise prosperity, but that's the only hope with what the feds -- hope asset inflation, and no one wants the fed -- if you read the new york times, no onements to raise rates, can't do it, so they say keep doing it, keep enriching the rich and penalizing savers. >> taking the other side for a

moment, he argues it's not happened, it's not happen, and, b, if you put your foot off the brake, everybody -- you know, everybody would be in pain. >> off the gas. >> i said the brake, but, yes -- >> the poor stay poor, the middle class stays middle class like today? >> i'm not making it a partisan issue, but in my opinion, it's a fact. the facts are the policies were districtive, and gietny ear book, you have luxury prices moving up 10 to 15% throughout the crisis. >> you paint this horrific -- okay, you -- 5.5% unemployment, you think that's -- i don't know if you saw the piece how this is a balance sheet recovery, appears to look better, but it's not an income sheet recovery.

you said that bernanke said if we're at zero, we're trapped because we glossed over the restructuring we should have done. try to avoid pain in the system from the financial crisis, but we've not set up were a real rebound. >> true. >> really? >> look back at the crisis in the 70s, 80s, and 1990s. they were easier to deal with because you had fed funding rates at 5%, 6%. it's easy. if you have not had the rates down to 0, right, each incremental move lower solves the problem, but at the 0 level, so, in reference to the 2002 -- the famous held cometer speech, he talks about staying away from the zero at all costs, and if you were to get there, we need to get away from the 0 as fast as poll. >> how does that go against his -- you wanted to be remembered as someone who saved

us in the financial crisis? >> sure. citi group, taxpayer money, look at the crazy things they did. look, it's easier to look back now and say there's many things we should have done. >> stuck here for good and never getting back to 4 %? we're stuck? >> i can't imagine our fed funds rate at 4%. >> the economy says slow? >> i think the economy in nominal terms is growing. >> we have to go. more from kyle through the the program. squawk's coming right back after the short break. time now for today's trivia question. who is the richest person in ja pap? the answer when cnbc's "squawk box" continues. aflac! and a gentle wavelike motion... aahhh- ahhhhhh. liberate your spine, ahhh-ahhhhhh aflac! and reach, toes blossoming... not that great at yoga.

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ah, nothing much. just keeping the lights on. (laugh) nice. doing the big things that move an economy. see you tomorrow, mac. see you tomorrow, sam. just another day at norfolk southern. >> now the answer to today's aflac trivia question. who is the richest person in japan? the answer? soft bank's ceo mashuyushi son. coming up, 75 years and out? a controversial call on houpg we should be living. is 75 years enough? i got the short answer on that.

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♪ welcome back to "squawk box," everyone, a new holiday forecast calls for 4 % growth this year. retail sales driven by the improving economy overall. the nation's soda makers pledge to reduce the number of calories in bev ramgs by 20% in the next decade. coke, pepsi, and dr. pepper promising to make aggressive marketing of smaller sizes of sodas. along with bottled water and diet drinks, that announcement was made at the clinton global initiative yesterday, and we, of course, were there. we sat down with the former president clinton to talk about a wide range of issues including tax inversions. >> the treasury department is legally obligated to get as much revenue as owed, athey can correct. it's bailing water out of a leaky boat, and there are only

two things to plug the leak in the boat. we undertake corporate tax reform or every other country in the world says we are wrong, and we'll go back to doing the way we used to do it. >> the president pointed out he's the one who signed the current corporate tax rates into effect, but at that point, every other nation, all the other ocd nations were at the same level and can't be there at this point. >> right. got to fix it. we do. we all remember the insider trading scandal with marsha stewart, owning stock in a company run by her friend. both served time for trading activity around the fda's rejection of the application, actually, for the stock. i remember it so well. served five years in prison, now back on the scene, which we knew about, and we have more. >> that's right. waksal founded a new company, based in the same building in

new york city actually, and he's operating as a private company, chairman and ceo as the settlement with the fcc, an officer or director of any public company. now, though, i have plans to go public. the company is filing this year and plans to proceed with the initial public offering. because of the bar, sam waksal is not ceo, but bringing on his brother to be the ceo and president. sam's title is chief of innovati innovation, science, and strategy and chairman. he founded this with sam in 1984 and rap the company. he left in 2003 before it was approved, ahe's raised $500 million in debt and equity, selling drugs for hepatitusc, cancer, and other ab norties. declining further comment, but will join us soon on cnbc to share more. guys? >> i knew sam well, a real

social fixture in new york, had a beautiful loft, used to date actresses and it was it was a shakespearean tragedy that got mori interesting, and, you know, the way that it -- i felt bad, and i was in contact with sam waiting for news the application was received by the fda, and i called in late december, and it was, like, we have to hear from them now, sam, what happened? what happened? then the next thing you know, the fda rejected the application, really, for weird reasons, it was -- >> structure of the trial. >> it was not, you know, there were pieces on his brother, harlan, had problem with the authorities 25 years ago coming into country. i don't know. it was bizarre.

it was a shakespearean -- i don't know the flaw there, but selling and getting family members to sell when you had the inside information that the application was rejected. you say icahn come in, and -- what does carl know about egf blockers and cancer? unbelievable. >> folks to run the company, rich mulligan from harvard. >> what was sold for? >> $6.5 billion. >> and he's in jail. >> he got a pass. >> look at sam as a, you know, he -- you pursued this drug, help people, and you're in there -- license plate, making these things, and in prison, and martha caught up in the whole -- where she got a phone call that maybe -- the whole thing, anyway, ancient history.

i knew them both when it happened. was not involved myself. america's baby boom culture is about living longer, everything from pills to excessive exercise to juice cleanses, but a doctor is completely rejecting the push to the american immortal and wrote an opinion piece in this month's at lan tech monthly called why i hope to die at 7 a5. joining us now to make his case from the university of pennsylvania and a quote from the article, americans seem to be obsessed with exercising and doing mental puzzles and consumes juice and protein concoctions. sticking to diets, popping vitamins and supplements in effort to cheat death and prolong life for as long as possible. it's so pervasive, it defines a type of what i call the american immortal. you know, we like -- we like provocative pieces, and it's the at lap tick and everything, but

i think part of the i get what you are saying, but i phrase it a different way. to say we shouldn't spend $500,000 in the last six months of life at the age of 95 is one thing, but to put me out to pasture at 75, sorry, man, and i bet you, when you're 74 and a half, there's no atheists in the fox hole, and you're going to come around, my frenl, if you're feeling good. no way you hope to check out in six months. grant me that. >> first of all, the article, i didn't choose the title. the article says i'm dying at 75. >> no, i know. >> the article clearly says what i'm going to do is stop going to the doctor, stop doing things that are meant to prolong my life. one of the things you and everyone hopes is that you'll be vigorous, be the the same as you were at 50 years old at 85 years old, and then just fall off the end of the cliff and quickly die without any disabilities without

dementia or other problems. that's just not the way it goes, and so i think we need to think about how we want our whole life to go including the end bit, and what i'm emphasizing here is i want to focus on quality of life, not it's not how many years, but the quality. >> it's different for everyone. i have a mother-in-law not sick a day in her life, 84 years old, and still -- different for everybody. i have two words for you, jack elaine, or is that three. it's different for everyone. plus, you're -- i'm so far from -- i'm a singularity guy. i want on the grid. i want to be part cyborg. if i'm getting dementia, i want a mechanical brain, i'll download it. if i have arthritis, i'll get a mechanical arm. >> there's a not possible today, that's clear, and second of all, everyone, the moment they read

the article, the first thing they do is figure out the two or three people they know who are perfectly competent, vibrant, over 75, and they say this disproves it. >> i'm going for830 or 90. >> cnbc should be looking at data. we're not all outliers who are healthy going well after 75. look at number of people at 85 who is alzheimer's, a third and half 85 and over. that's not a number most americans look forward to, and, yes, there are people who avoid it, so the big question is, how much disability is technology going to allow you to download your brain -- i seriously doubt it -- i'm looking much more realistically, again, at quality of life. the article is written from a personal perspective. i didn't say it was true for everyone. >> i know, and i was glad. as a liver, i was thinking, oh, my god, he wants to equalize

outcome everywhere, not just income, or equality, but even when we die. some people do not deserve to live past 75. don't use anymore resources up for the next generation. sound like a liberal -- >> as the article says, look, as the article says, it's not about resource utilization or rationing, but personal view about the quality way to live. >> i bet your brothers like this, neither one can take over the entire world at 75. he will not take it over, and ron -- you know, neither one of them. they zis agrdisagree, don't the? >> when i wrote about it, i had one of the brothers in mind. >> you're not going to out him? won't say which it was. i agree, say what he's saying. >> i do. >> what? >> he's not telling you that everybody's supposed to die at

75. >> yeah, but you are a doctor, you are a doctor, and you know if you catch it early enough on you can control it, get a hold of it, and you said it yourself, the numbers -- >> sorry -- >> it's two-thirds of american over 85 do not have alzheimer's. odds are you are not going to have it. >> i have a question for you. >> there's physical disability, and as i point out in the article, separate from actual alzheimer's, we all slow down tremendously. we all circumscribe what we do, lose creativity. that's not what i want. i want to remember me the way i remember my grandpa, vigorous, engaged, loving, fun. >> andrew will talk about something in a second. i understand the crappy obamacare that the architect was works, if everyone is dead at 75. maybe that's the reason. stick around for a second. >> please. that is so -- listen, let's be serious, let's not be stupid. that is stupid.

>> you were provocative. we're going to come back. you didn't expect us to be totally serious with this piece. ewe you knew it was provocative. >> we'll come back to you after the break, and we want to talk about ebola, cdc could be 1.4 million cases in west africa by late january, and there's a new report saying u.s. hospitals are grossly unprepared to deal with tarts arriving unannounced in the country. the futures at this hour, we have green arrows, back in just a moment. cute little guy, huh?

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we are back, and before break, i had a serious question, a personal question. i have a grandmother who has alzheimer's who is in her mid-90s now, had them for about the past decade, probably longer, maybe 15 years, but the past decade to the point where she doesn't know us. at least appears to not know where she is, et cetera. what would you do with someone in that position? >> well, i'll tell you what i told my daughters. the moment i'm in that position, i don't want them to treat it at

all. i don't want them to feed me in terms that not eating, not drinking is a relatively painless way to go, and relatively quick. happens in two weeks. that's my view. i certainly would not intervene with life staeping treatments of any kind including antibiotics and other treatments. that's the way i view it. i think -- i don't know your grandmother or family, but if that was your grandmother's wishes or how she lived her life, that's the way i would go. again, for me, the most tragic thing would be to be mentally unable like your grandmother and not recognizing my family. that's a horror to me and burden on my childrenment i don't want that at all, and i'm willing to have a shorter life than to have that alternative. >> it's an interesting perspective. my grandfather, before he died, what he only wanted for her was

to actually be fed and have as much assistance as possible. he took the opposite position on this. he's not been with us for several years so has not seen the state she's now in, but it's a complicated issue as a family for us to all deal with this. >> this is something for years that, you know, living goals, and this makes, obviously, this is what i said in the beginning, makes perfect sense there's a difference, and 15 years of alzheimer alzheimer's, 95 years old, a far cry from someone -- everybody's different, zeke, but i don't -- i see -- it's not -- they are not out liers that are 75, happy as can be, and just because you're not creative anymore, like a chart about people at 60, don't do anything creative or you want to make an impression on your grandchildren so they don't see you age at all, those ring hallow with me. i think if you take care of yourself, go to 85 unless barring an unforeseen thing.

there's a lot of science between here and there as you know, for sure. >> let me make two points. first, the piece is written from a very personal perspective. >> right, okay. >> arguing about a different perspective and say clearly not everyone will share my view and the point at which i want it. i recognize -- >> andrew's the only person agreeing, anyone else agree with you in the entire world? >> he's not trying to kill everyone. >> i would say the response has come back in three categories, one, i'm totally crazy. two, i'm totally right. three, people who would prefer not to think about the issue because they are scared about the big questions, spiritual questions, what the meaning much life is, and that's the -- a third of the people think i'm exactly in the right place, a third of the people want to live forever, they are american

immortals and believe in all these protein drinks and pills and everything else, and then a third of the people really this scares them, and they think it's thought provoking and, like, what am i going to really do with my life, and many of them are, i think, you know, it's a scary position. >> zeke? >> i'm very clear -- >> go ahead. >> go ahead. >> what's the point surrounding it? hoping to make people think about it and have them get their own house in order? >> yes, i think that we don't think about it. we don't talk about it enough, and i do think that a major issue is to think how important is longevity, quality of life, and what we leave for our children, our community, the country, and i think we've tend to discount that. we don't think about the issue because we think we are vigorous to the en. that's not how life goes. >> i agree with you and understand the points of what

you say, but i think there's something that older people add in terms of wisdom and knowledge that they picked up over the decades that you don't find anywhere else. my 88-year-old grandmother, literally can think of dozens and dozens of people who i think are the smartest people i've ever met. they are well above 75, and i think they have so much to offer. i can't imagine not having those resources. >> again, in the piece, i talk about mentorship, offering advice, and telling stories to your -- to students, fellow workers, to children, and i agree. i think that's incredibly valuable, but that's not what's happening with andrew's grandmother. it also is not happening with lots and lots of other people. again, part of what i think unnerves people is, wow, this was more common than i thought. disability, not walking around, not able to be active, that's

higher than i thought. every year we add more years of disability rather than shrinking it. then people say there's the additional burden i'm placing on everyone else. given that collection, it's not the way you hope it is, vigorous, active, fully, mentally with it all the way to the end. it's much more likely you'll have a slow deterioration with things falling apart, and that is not the way i personally, as i say in the piece, want to go out. >> it's personal, but then, again, i heard you say a burden on others, and this has to do with sort of the viewpoint. playing golf on monday with a man who shot his age, shoots his age every time, zeke, 83. for me to do that, i have to live to a hundred, so i'm sorry, that's my number. it's going to be a hundred. that's just personal for me. >> all right. >> that's assuming i can't download myself on my grid and get an avatar. >> we'll well you on alkatraz

like you said and download yourself. >> bingo, but you're not invited. thank you, appreciate it. love you, zeke. >> oh, boy. still to come, clinton sits down with us at the global initiative yesterday. if he had $40 million to invest, where would he put it to work. this is what he said he would do with the money here in america. >> i would try to create universal access for rapid broadband and make sure that we could, in essence, create all these job opportunities flowing out of it. >> reaction from the comments from two tech innovators who built the google empire. they'll join us at the top of the hour, and we'll be right back.

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welcome back, argentina in a debt debacle and facing uncertainty. we have more on the story. >> thank you so much, andrew, an eventful few months for argentina being in a state of default since july. unclear what happens with unemployment and inflation raging and the peso at a record

low. the country's government in town for the united nation's general assembly, and the president speaks this morning, refusing to negotiate a resolution with a handful of hand out bonders who want full payment. kyle bass, of course, our guest here is a different class of holders that accepted a discount. you think the behavior is borderline immoral, is that right? >> i wouldn't say it's borderline immoral, it is. we need a system. it does not exist. the system is flawed in construct. you see a program led by the treasury, the u.s. treasury in the markets association that's trying to change the rules and define terms that were left for defining in the courts and put the clauses in the documents when the money's raised prospectively. unfortunately, the case is

actually the test case or the case that's cause iing changes implemented, and it cannot be helped by the pieces. >> can i show this on the screen right here? i don't know. can you see that right there? okay. look at this. a model of unsoundness in today's "wall street journal" paid for fatcheckargentina. and they that's how the finance minister put it. are you going to run ads on the other side? >> no. i mean, when you distill this down to what's going on, it's too constituencies that learned to literally hate each other. this is a scenario where there's a win-win-win. i wouldn't say that we're opposed not position. if they get paid and anyone investing this argentina does well. >> you want a resolution here because you put money down in

arian gene tee that, right, you own bonds and debt and taken a big position in the energy company, right? >> correct. >> that's become a popular holding among asset managers, hemg funds especially latesly. we have a screen of the hedge funds involved, but tell us why there's a compelling opportunity there, kyle. >> i think that argentina's primary problem, look at the balance of trade, it's the energy imports. they are a resource-rich nation. as you know prior to this day in age, they were the wealthiest nation on earth. you have a scenario in which it's a beautiful country, 4 million people with external debt of 15, and yet 3% of bondholders and their investors hold up 42 million people from progress, so, andrew, back to the question, both sides have kind of caused a wrong here, but

at this point in thyme, you still have this able to hole an entire country ransom and hiding behind the fact they are a big proponent of the rule of law in the united states, but them you get in the morality issue of it all, and a quarter of the population of argentina is poor, over 10 million people over the poverty line, and that's defined there as $2 10a month or $7 a day. that's awful. solving this scenario helps everybody. >> kyle, thank you. we all hope it gets out one way or another. what we can learn from google, two of the most prominent men in tech share the secrets bind the world's most powerful tech company. look at futures right now." squawk box" will be right back.

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>> how google works, culture to creativity, a new book by eric on what drives the tech giant. talking innovation and how google is looking for world domination. >> the next big thing in web ads, the company's ceo talk about what he calls his google

killer business model. >> and curb dreams crushed. why the pot business is not for everyone as the final hour of "squawk box" begins right now. ♪ >> welcome back to "squawk box," i'm joe with becky, and andrew, and our guest host, kyle bass, he'll be us with for another hour. it's been great. >> it has been. we have a lot more to talk about. walmart is teaming up with green dot to offer banking service to the customers to get rid of fees charged traditional banks. president obama addresses the u.n. today after the u.s. carried out new air strikes

against isis and syria. in a separate mission, the u.s. military recognizes and targets a new terror group known as khorasan. a new report says that directors of the biggest public companies received other fees last year, up from 2009. you saw what happened with the markets over that period of time. >> okay. we are getting inside the mind of google this morning. the internet giant expanded greatly, of course, from the first beginnings, and in the new book "how google work," the chairman with rose pberg you break down innovation and competition. welcome to both of you to the broadcast this morning. hey, guys, thank you for joining us. congratulations on the book. >> well, thank you, thank you for having us. >> quick question, related to the book, but somewhat unrelated, your book happens to

be published which is in a bit of a battle with amazon, and i did notice this morning that amazon happens to be selling it, so good for you. you apparently can get it within a day, but there's been lots of complaints within the book publishing world that among authors that amazon has become an unfair monopoly. you know so well because google has that certain aks in a similar vap. i want your take on that. >> you know, my view is that amazon has brought enormous efficiency to the distribution network of books and all the other products, and we have big partnerships with amazon, but we compete with them. it's always a missioned answer. >> how did you get the book sold? one of the few that seem to be selling right now. did you call jeff yourself? >> we did not. hopefully they are excited about the book. they did not allow preorders, but stocked it a day earlier.

>> i'm curious, working with eric, give us a lot of pieces in the book that were relative to google, specifically china, which i want to get into, but there was one thing -- the book is called "how google works," if that's one thing, it's what? >> how it's created. eric has a clear sense of rather than trying to tell people how to think, he's really thoughtful about managing the environment in which they think. >> one of the other things that's fascinating about google over the years is the number of products in business lines that you are in. i mean, literally, could be hundreds of different businesses that you got in, and at what point is it too much, eric? >> i'm not sure there's ever too much as long as the products are good. it's too much if the products

are not good. we wrote the book evaluated what we thought about the new things google and others invent, and we decided that the new truth is that you can't rely on marketing for products success. you can't rely on distribution for product success. the product has to be really good, and if it is really good, in order to get that, you need a culture to promote that, which is what the book is about. >> eric, companies do one thing really, really well and live offer that a long time. >> that's under shooting an opportunity, right? when we set up google, we set up a strategy to do systematic innovation. the idea was is if we invent new things, we invent more new things, right? recently, google invented a contact lens with a computer chip in it for diabetics, give them a color in the eye, alerting of the insulin levels, a huge huge improvement, right? that was not possible ten years ago, yet here we have it.

>> the search business is a massive success, but it's also allowed even subsidized effecting for the other businesses. if you pick one or two other business lines, which of the next ones have the opportunity that looks anything like search? >> well, i think the video business is very exciting. youtube is certainly doing very well, and we're also having a great deal of success in enterprise markets bringing a lot of the functionality to customers in businesses. lastly, i think the google play business is doing very well. the android ecosystem's explo exploding and number of apps and content people want to buy on smart phones is growing very, very rapidly, all very, very big markets. >> to answer the question of nonsort of internet things, it's much harder. it's harder to know whether the transportation initiatives, medical initiatives take off, but you can see that maybe in a decade from now, those can be massive or not, depending on how successful the products are. >> guys, i want you to respond to a culture question in the way of a thinking question.

this is something tim cook said in an online message last week about privacy. he said, our business model is straightforwa straightforward, sell great products, not based on your habits, don't sell to advertisers or monetize information stored in your cloud, and we don't read your e-mail or imagines to get information to market to you. our services are designed to make devices better, plain and simple. i imagine that was aimed at you. what do you think of that? >> well, you know, i read this, and i thought -- is he really familiar with how google works? i mean, the product, not the book. we do do targeted ads against g-mail, doing that for a decade, but we don't otherwise use that information. we don't do the other things that he is implying in a careful way in the message. >> but most people think that you are effectively using all this information. by the way, it's been to my

benefit. i'm in the google world, i go to the map, and you know where my home and work is, and they ask if i'm going to work because it can already figure that out, tells me if i'm going not airport because it's going to my mail and figuring that out. it's doing some of this some how. >> but not what tim cook said. what we are doing is using information with your permission to make your life better, and you can turn all of that off in one click. >> okay. >> let me also show you a clip, which i think we have. we have, asked to invest a dollar in apple or google, which would he do? do we have that sound? >> we don't, but his answer was google. >> having said that, the biggest risk is what's going on in the e.u. can you update us on where that stands and where do you think

this is going to go? >> well, we've been working with the commission for almost four years in an antitrust investigation, and in roughly mar of much of this year, we have an agreement with not only do we agree, but they began to send out a rejection letter to the complaints, which is part of the process. over the summer, we were alerted that they have new concerns and new requests which they have telegraphed to us, and we are evaluating them. the process is fairly slow going, but we are working on it. >> and -- what's the implication in terms of you guys finding a way to actually meet the requirements they are receiving? >> well, we've always wanted to come to a solution that works for us and for the european union. we've always believed they have a job to do and that, you know, we should work directly with them. the commission will be changing over leadership, and so we are working with that deadline, can we get it done before that or do we have to wait until a new commission is formed, which is

roughly after november 1 -- >> will it make sense for you to remove links to things, for example, and on the other side, the stuff is still going to exist on the internet? can other people search on other search engines to get there? >> that's another separate issue, the right to be forgotten, and it's important to keep them separate. the brussels activity is under anti trust rules in europe but not present in the united states. the right to be forgotten is a new law or right discovered by the european court of justice, nothing to do with brussels, and, in fact, it's in luxumburg, i believe, and if you're not a national figure, goog the is required to remove information from google if you request it. you have to request it. you have to be a european union member. google opposed this for many reasons, but it's the law in europe, and we're forced to come b comply with it.

we have a series of seminals throughout europe to discuss how to do this. the court was specific in saying that google had to make the decisions, the job which we don't particularly want to have. >> right. guys, one of the fascinating sort of antedotes in the book is about your decision, eric, to leave china. you wanted to stay it sounded like, and there was a debate to some degree where they were insis tent. tell us about that. >> you were there. how did it play out? >> the china decision -- eric gathered all of this. it was a sunday afternoon. it was by the time the meeting began, and eric recognized it was important to gather the staff and have everyone participate and feel like they were engauged in the decision. we actually had a very long discussion, went through all the details at the incident, and, ultimately, eric asked everyone to skroet vote, and everyone had a say, an we then made the

decision, which is document in the book in terms of the history. >> in the book, we try to explain this as something call the bottle head problem. if you end up in a situation where everybody's -- this is going like this, they leave the room and go against the decision made by the decision maker or the process. it's very, very important that a well-run company to have everyone feel like they participated in the decision even if they disagree with it. >> you're saying make them feel like they participate? it was a app aexperience of feeling like they were involved in this or sway and change the decision? >> you never know. the characteristic is people have strong opinions, but their opinions can be changed by data or new facts, and so you never know. you hay think you know, but from my perspective, the best scenario is you get everyone in the room, have a robust conversation that everyone participating in, not just the usual three people talking all the time. you get -- the goal is not to get to consensus, but, ncin fac

to find the best decision. that's what the leader does. >> to clarify, on china, on a personal level, a mistake or right decision to get out? >> the company feels like we ultimately made the right decision at the time. i've been moreae oriented than the others, but there's all good reasons to do both sides. it was ultimately seen inside the company as a decision that could go either way. >> okay. we're dping to leave the conversation there. the book is called "how google works," and it actually is vail on amazon despite that. congratulations on the book. >> thank you, guys. looming potential crisis in japan, kyle bass is bearish. why he thinks inevitably they could be sucked into a debt crisis and maybe there's a couple reasons why it won't. later, the cannabis industry is smoking hot, so why is setting up a business in the

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welcome back, everybody, shares of the -- mobile checking thes. >> japan's facing an abyss and a crash could happen any day. we want to start -- you do own ypf, have a stake, and it was not in the 13? >> we do. >> okay and the rationale? >> well, once the issue with the vulture funds are settle, argentina -- they will reaccess the kpacapital markets. the problem with balance and trade is energy, and ypf is the largest energy company own by the government in argentina and a portion of the public. we expect a hundred to 2 00 billion in foreign direct investment in argentina's oil field in ten years so ypf is not just a proxy to argentina's equity market, but as the real

dominant player in the energy business which we think is transformed over the next five to ten years. >> so with japan, people -- you've seen all the stuff that's been written, that you can never be right. you've been bearish too long on japan. tell us what was, for years you've been thinking this, and it has to do with trying to monetize the current account, trying to defeat deflation once and for all. what's the thesis? >> well, look, when you get to where they are today, close to 150%, and debt to gdp, more importantly, they spend 25% of central government tax revenue alone, 50% on that service. when you get to that point, when your debt gets to be 29 times revenue, you're technically insolvent. >> with low rates. >> with 0 rates. >> already getting strangled by the -- >> right, so, you know, it's a

bit hyperbox to say they are headed for a crash, but there's two potential outlets here, one's currency, one's rates. so far they bought all the bonds, fiscalizing the deficafi next year, and so far that's work. worked meaning it holds rates low. the dollar is 108.5, but the dollar is headed to 125 fast because now the plumbing changed, right? for the figure time in 34 years, they run a full current account deficit. negative 1 today, negative 2 to 5 next year depending on the expectations and what they are going to do moving from jdbs to foreign assets. this is a transformative point in their evolution of their debt problem, and it's so far played out in the currency market, that's why we've been focused on this now for three and a half years. we've been focused on the

currency primarily, the rates secondarily, and we've, f fortunately, been more right than wrong and doing well. we are positioned in the currency and the rates, but the rates have not moved yet. >> so how could they avoid some type of crisis? >> this goes back to one of your pet peeves, one of your believes that if you can expand your central bank balance sheet and literally have absolutely no impact on your rates, then why do we need to have a fiscal balance? why stop spending? >> why charge interest? >> why worry about what our federal government spends? in the end, it catches up with you. the question is, when? >> with debasing the currency, doesn't it? >> it has to. think about the last 18 months, the yen deappreciated 25 president.

nominal gdp in japan move up 11 %, 12 %, but on a currency basis, so in dollar terms, japanese gdp's dropped 11%, all right? because the currency depreerlgted faster than gdp is running. the economists' model talks about the curve. decrease 25%, you have an initial low in the gdp and the result is an exponential move. as you sell more things, imports cost you more, but we never saw that curve take effect in japan. what's happening now is they are hoping that consumption is going to save the day. so far, they've achieved north of 1% cpi inflation, but they are achieving costs pushing inflation, not demand pull, and that's not good over a long period of time. my hope is that they figure this out. my belief is that they can't figure this out. >> it's a chicken-egg thing too. they need to increase the birthrate to generate consumers,

but no one's -- everybody's still afraid to do anything. >> joe, when you are where you are, a duration mismatch, you can't financially incentivize people to have children traed today. it's far too gone. >> they need to finish everyone off at 75. >> you said that. you said that. >> coming up, how much will you pay for a wooly mammoth? you could own one. how after the break. in the army stages of what would be a long home run for tech or is the air coming out of the bubble? the coo of tech investing firm joins us to talk investing in the valley. "squawk box" returns in a

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welcome back, everyone. looking at the stocks in the news ahead of the wednesday session. striking a collaboration deal with smaller drug developers, the agreement covers an experimental pancreatic cancer treatment, mm 98. a court of therapeutics is buying privately held civitox, and gaining rights to the disease treatments now in late stages of development. the movie cable channel starz may be for sale. they hired a firm to seek a

possible buyer and l.a. times is named 21st century fox as a poll suitor. >> okay. is there a leak in the tech bubble? that's the question. zurching 20 % over the past year, peaking friday after alibaba's record breaking ipo, but alibaba down now 6% and nasdaq down 2%. joining us now is we have one of the top investors, scott, thank you for joining us this morning. you think there's a bull market, and others think there's a top. make the case. >> well, i think first of all, as you know, there's a lot of hammering about whether we see managers who have to have positions to buy alibaba. we saw that rotation earlier in the week, but in general, actually, the the ipo was well, and for the most part, i think, has done well. you're right. there's been tradeoff in the last couple days, but that's

been more of a machination than tech for alibaba in particular. >> we've seen a number of things happen in the past week. we have the ipo. we have the resignation of the move to become the chairman. you have sap buying, all these -- you have a lot of stuff happening in the tech world, microsoft buying mine craft. a lot of people view that and say that's the top, not the beginning of something. what are we in? >> i think that's a good sign of the beginning. let's take those in turn. fist of all, what's interesting is it remits the culmination of, quite franks frankly, a long winter of consumer internet companies and people questioning whether they were viable models for consumer internet. if you were in the valley, of course, we had the bubble in 2000 and there was nothing interesting going on in consumer interpret, and you had alibaba starting in snooip, and in 2004, you have linked in, facebook, and twieter started in the same

year, and look at what happened from 2012 with the facebook ipo, i think most people would agree that the economics of the consumer interpret are su peoria. that's encouraging. you mention the enterprise side. there's an interesting juxtaposition seeing oracle on the one hand handing over the reigns to the existing management team there, which really, quite frankly, remits not a lot of change in the company, and at the same time, you see sap doing a bold acquisition in the form of concur, following on the heels of a couple years ago, a successful deal they did. i think the way to read the enterprise stuff is we're at the very, very beginning of the cusp of the enterprise revolution technology, and m&a in particular has not been that strong so far so i think the sap concur deal sets off quite a bit of m&a activity in the broader enterprise. >> yellen was wrong, saying the technology space is

substantially stretched. >> right. greenspan made the same comment in december of 1996, and, yeah, he was off by 40 years. listen to him then, you missed a lot? 1996 and peaking in 2000. >> you missed at least 80%, right? >> i think that's right. i think nasdaq was somewhere around a thousand when that was made by greenspan, peaking shy of 5,000 in 2000. a painful run. >> it was a good term, and in terms of being a forecast, it's the opposite. it was a consensus point that we're making with it now, but people forget. >> i think that's right, and, look, you know, as you know, we will get, you know, the way the financial market works is there are bubbles in some point in time, but they run a long time, and, again, i think the acquisitions seen of microsoft,

the sap acquisition, that's a precursor to activity in the enterprise side. >> run until people stop talking about bubbles. >> that's right. as long as you have me on here, you'll be buying, right? >> scott, before we let you go, there was a comment, you're an investor in lyft, competes with uber, and i don't know if you saw what he said, he thought uber was, quote, unethical. do you agree or disagree? >> well, yeah, peter, i think he does not need me to defend him, but, look, there's been loss of article in business activity, but there's two markets here, the broader card sharing market, and the other is the institution that they have done a great job on. i'm not getting in the middle of the frame with peter there. >> you're not buying any alibaba? >> well, we're not public market investors. >> would you personally?

>> no, no. i stay away from that. no reason to get in the middle of that train. >> okay. leaving it there. scott, thank you for joining us this morning. >> great, thank you, bye. >> thanks, scott. have you consider opening a marijuana business? think again. states continue too legalize marijuana for medicinal use, there's a word we are trying to coin, and i don't like it. i say potreprenuers. it makes it difficult for them to start, and kate went to crane's canibus -- this is for people who want on the can i bus? >> there's enough to rival the

cannabis industry with 23 states legalizing it and california and washington took a a step further legalizing recreational use. there's cash to be made in businesses and state governments. a report found that if all 50 states legalize cannabis today, they would rake in more than $3 billion a year in taxes. colorado will take in 70 million this year in taxes from legalization, but for entrepreneurs interested in a piece of the pot pie, be prepared for an uphill battle. first, we have transporting the goods. many states like new york and connecticut do not allow the drug to be shipped, even though you can have prescription drugs sent to your doorstepsment only patience and license care givers can pick up the drug. another r, taxes and audits. normal banking relationships are really hard to come by because the drug is illegal under federal law. you have to expect to be audited. also know that you can't dedugt your business expenses because

it's a schedule 1 drug. owners say effective tax rates are as high as 70% no matter what state they are in. finally, pricing, which in new york, currently waiting on guidelines from regulators before patients can purchase marijuana legally. the department of health will be setting the drugs price. this has people concerned. if prices are too high, the black market could look aluring again. >> wow. >> another one in there, pot pie. >> pot pie. i wrote that myself. >> that was a good one. what's the purpose to legalize it if it becomes illegal again because there's the criminal network with the black market. >> that was an interesting point from the summit because the department of health -- so they'll be setting the prices in new york over the next 17 months. they'll work with state troopers within the state to find the black market and i hope it's on point, but the people at the summit said if prices are too high, people may want to go back to the black market. >> and the taxes, so 70% is the

rate? they are going to mess it up. they decided to do it, they will screw it up like the government consistently screws things up. >> there's hope they can write off the business expenses like other small companies can do, but right now, it's not an option. >> are they recognized as companies by the federal government since it's not legal federally? can you write that up on taxes? >> you can't. that's the issue. you have to find an issue to skirt federal p law because it's illegal by federal law, but if the states say it's okay, there's certain guidelines states write down so you don't break federal law. >> the medicinal against recreational, that's a big separation too. you would hope that they make it easy for medicinal providers to be able to do what they are trying to do, but you get into a whole different value judgment question about recreational use because people make tons of money, but then you get -- i remember out on venice beach for medicinal five years ago, you go in, you can go in and say, i'm

anxious, i have a lot of anxie y anxiety, and that was medicinal use. >> another issue is divergence. people are concerned. that's where the carrier issue comes in. you can deliver to a patient with a prescription for it, but people are concerned it'll get into hands of the wrong people. >> right. wow. >> so many issues and regulat n regulations to deal with. >> yes, and a lot of -- >> thank you. >> coming up, anwar firing up, and the company's ceo talkings future of advertising and how the company would be a google pill. check out the shares of kb homes, falling. the building says up 9%, but deliveries down due to delays in construction, which i know something about, and customer mortgages.

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welcome back, everybody, the ad industry brings back $170 billion this year for everything from television to radio to the entire digital domain. today, seeming like every company has hands in advertising and the numbers keep growing. one of the new players is the company called appnexes, and the values is at 1.2 million. we are talking about the

changing landscape in the industry. we've been calling you in the teases, a google killer. that may be overstretching it. what do you do, and what does google do? >> well, so this is the largest independent app technology company. we serve half of the ads online and 30 billion around the world. google, as we heard earlier, does a lot of different things, drones and contact lenses, and so all we focus on is technology that decides which ads you see when you browse the internet every day. >> who are your customers? >> microsoft, dichhundreds of companies around the world who either buy or sell advertising online. >> how does it work? what's the mechanics behind it all? >> so the gimmick, if you will, is that web pages look like they load content and ads at the same time, but in practice, what

happens is the content loads and an empty box appears, and in the box we hole a realtime auction of hundreds of thousands of advertisers who bid on the chance to serve you app ad in the blipg of the eye. who plays the most money serves you the app. that's realtime bidding. it's $6 billion of tradvertisin just this year. >> a company like google do you compete with them or work with them in any essence. >> you can't exist on the internet without working with google in some way. we compete with them. they bought a company call double click, a new york based ad company back in 2007, and so double click is the division of google that we compete with, and so, you know, they are the biggest, and we're second bigge biggest, and across the world we're going outs to customers, trying to convince them our solution is better than theirs. >> how do you convince them? what's the difference between the two solutions? >> well, our idea is this should be an open ecosystem, and there's a real temptation for

companies to create a wall garden and not let others innovate around it. our companies and customers try to figure out new formats, data, new ways to make advertising more creative and effective for the consumers, marketers, and the publishers. really to push money through the ecosystem. this is like the life blood of the internet. if we get more money flowing to great content to journalism, then we can actually make the internet more vibrant, more democratic, and more open. >> go ahead. >> please. >> we talk about the interpret being the ultimate place where you know how many times an ad is viewed, exactly what they are looking at, clicking through to. is it per felgt in its measurement, or are there ways you can get fooled and tricked along the way by thinking somebody clicked on the ad they did not click on? >> nothing's perfect. i'd say that, you know, we have a lot better idea how many people view ads or click on ads online than we do with say a newspaper or in the extreme

example, a billboard. i've never climbed up and click the on a billboard, and if anyone tells you i have, they are lying. >> what's the error rate? what's the margin of error? >> it's very low. so there are actually standards, there's mrc, the rating counsel, with an auditing program. the ieb, the international advertising bureau, has audit programs, all the big companies that get certified testing across every combination of browsers, donephones, and forma. it's accurate these days. what does the new infusion make? >> we raised $110 million overall, and what it means is that we have the resources to compete with google and facebook and other companies like that all around the world. it means we can keep hiring with the acquisition of open ad stream, which is a publisher ad serving technology that wpp bought back in 2007. we'll have over 800 people

globallying and we expand r you know, hundreds of people a year as well. this is cash that lets uses us continue to repeat. >> brooing, thank you for coming in today. >> thanks for having me. >> coming up. jim cramer joins us, and a tribute to jeter with building blocks. the video is viral. we return in just a moment.

one, 1-2. he loops that to left field. jeter flies it to the stands. >> building block sports mini figures paying tribute to derek jeter. the video has gone viral. the company re-creating what they're calling jeter's top ten moments of his career. jeter will play his final game at yankee stadium tomorrow night against the orioles. let us get down to the new york stock exchange where jim cramer joins us now. we've had a couple rough sessions. do you get the feeling that anything is different at this point? we go to new highs before we start heading lower again? >> no, russia/ukraine putting

tremendous pressure on europe. if you have business in europe, your numbers are coming down. sol you're seeing a lot of international stocks continue to decline. the small-cap rollover is quite daunting. i think that's directly related to the fact that people come on air and say the fed's about to tighten or that we're no longer easing and it's an easy trade to be able to ring that register. i don't think the gloom is done, but i think there are spots that are very, very interesting that are not internationally related that have nothing to do with russia, nothing to do with germany. they're being brought down just as a matter of course because the rest of the market is falling. >> okay. keep it short, jim. we do have a lot -- you know, we've got things happening in syria. god knows what happens there. then ebola. >> stay on biotech, joe. >> we need to get on an ebola cocktail, too, that actually works. or a vaccine. we should be doing this now. >> we'll do it.

our guys are the best. we'll solve this. >> yeah, we will. all right. thank you, jim. we'll see you. still to come this morning, kyle bass was one of the few lucky investors able to get in early on the action on ali baa baa. we'll get his take on where the stock goes from here. "squawk box" will be right back. don't compromise. i ok, how about 10 gigs of data to share, unlimited talk and text, and you can choose from 2 to 10 lines. wow, sounds like a great deal. so i'm getting exactly what i want, then? appears so. now, um, i'm not too sure what to do with my arms right now 'cause this is when i usually start throwing things. oh, that's terrifying at&t's best-ever pricing. 2-10 lines, 10 gigs of truly shareable data, unlimited talk and text, starting at $130 a month. and you'll see just how much it has to offer, especially if you're thinking of moving an old 401(k) to a fidelity ira. it gives you a wide range of investment options... and the free help you need

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welcome back to "squawk box." if you're watching us from the treadmill this morning, pick it up a little bit. really. >> pick up the pace. >> listen to this story. a new study out of europe finds that vigorous exercise could be bad for your teeth. >> people grind their teeth when they exercise, right? >> athletes are said to be at higher risk for cavities and other oral issues. among the possible reasons, consumption of sports drinks and oral hygiene routine. >> what, they don't brush their teeth because they're too busy working out? >> their teeth sweat more maybe? >> that's what's going on with my teeth. always working out. >> one more story for all you devoted exercisers. a different study suggests that people that exercise more than usual on the same days they drink more alcohol than usual -- i can tell you that after you

run those first six years go down much smoother. >> people who work out more also eat more. >> you definitely do. you sleep better. it's everything. you fknow what else is good? getting up early and going to bed early. am i right? what time do you get up? >> 5:00. >> what time do you go to bed? >> 10:30. >> you need more sleep. >> i agree. >> let's get some final thoughts from our guest host kyle bass this morning. before we went to break, we teased that you had bought into alibaba. just wanted to understand your views on alibaba. >> yeah, i mean, i think it's pretty fully valued here. first of all, i'm not a tech investor, number one. butting loo -- but looking at the business, trading for $240 billion, you know, i think maybe 40 times is fairly valued. >> what about yahoo!? >> that was always the back door play. >> we had an investment in

softbank early on as alibaba began talking about going public because of the conglomerate was going to be extremely cheap. a lot of other investors went there. with yahoo! we saw the enormous amount of retail money invested in yahoo!. in the weeks preceding alibaba's ipo. so we were actually short yahoo! on the day just to trade retail sentiment. now the event happened, and everyone looked at each other and said, why do we own yahoo! when we can own alibaba? >> did you close out your short now? >> yeah, that day. >> but long term on yahoo!? do you have a view? >> i don't. >> one way or the other? >> i don't. >> another stock you were involved in that remains a controversial stock is herbalife. you were in and out on the long side against mr. ackman. mr. ackman still believes this is the great pyramid scheme of our time. you think what? >> if you read mr. ackman's

piece on multilevel marketing he did when he ran gotham and he was long prepaid legal, you could cut and paste herbalife and put it back into his prepaid legal fees and he would be long if he were running gotham. we put one of our traders into the network of herbalife and he became a distributor. for us to understand exactly how those meetings work, how the distribution centers work, what the selling tactics were -- i believe it's a real business. i believe the ftc won't sue them. i believe it's not a ponzi scheme. but, you know, we just aren't involved now. i would always bet on dan loeb over bill ackman any day. >> wow. >> really? because? >> i've known dan a long time. i don't find him to be hyperbolic. ackman is a great invest of a

lot of things. in this case, we've done the work and disagree with dan. >> their candy bars are okay. >> kyle, thank you so much. please come back. >> and you, please come back tomorrow. in the meantime, make sure you join us for "squawk on the street." ♪ good wednesday morning. welcome to "squawk on the street." i'm carl quintanilla with jaim cramer, david faber at the new york stock exchange. the s&p is now down three sessions in a row, flirting with its first four-day losing streak of 2014. that three-day slide in the markets, more negative data out of europe. but stocks edge up on the promise of more stimulus. geopolitics also continuing to weigh on the dollar. oil is down for the third day in a row. >> and it is the biggest ipo of the year. well, other than that other ipo on friday you may