♪ ♪ keep your eyes on the road ♪ hand upon the wheel welcome to "squawk alley." two specials guests john steinberg, ceo of the daily mail north america and the mustache yo slava ruben. founder and ceo of indigo go. jon fortt and kayla tausche a lot going on, according to the journal, apple considering issuing new bonds in our ross would mark the first time the company, which has yet to sell bonds in any currency other than dollars, apple holding an investor call arranged by goldman and deutsch and more apple news, according to nine to five mac the watch is scheduled to launch in the spring, later than many had originally expected. coming from a video message from retail chief angela airns to apple employees. we will get through the

holidays, chinese new year and then the watch. what's the bigger deal, the stock is almost back to -- almost up to 110, all-time high yet again, a lot of people think it's on the currency move the bond move. >> yeah. i mean i think this watch stuff is interesting, but i didn't expect them to come out with a watch in january. i mean, they like to take a little pause, a little breather after the holiday season, get their ducks in a row. i wouldn't be surprise if this falls in the launch window that used to be occupied by the ipad, which is more april time period. i guess there's some rumors about valentine's day, but no, i doubt it. they have to be careful about how they roll this out. i think they have to tweak their retail setup quite a bit because right now it's set up to showcase iphones more and iphone accessories. and then on the bond stuff when you have an 850 credit score and interest rates are at a low and probably heading higher, it's a good time to take out a home equity line. >> talked to market sources about what this deal would look like, still talk of what the

size would be. but most interesting from my perspective is the fact that these banks would be potentially leading this deal, whether it is a bond deal or some other capital market transaction out of london which does let you know that they are not only planning to issue at least part of this deal in some non--u.s. dollar currency but this possibly this -- these proceeds would be dom soiled elsewhere. so then it raises the question not only has apple been good at timing the market in terms of interest rates, but also with the majority of its cash hoard already abroad, why does it need more money outside the u.s.? could this portend to non-u.s. deal. >> the thought i had it's overseas but in the wrong domi soils and the issue with it being in ireland and moving to england has had issues with the uk. they could raise the bond cash there and use it somehow to buy back stock in england, is the theory i possibly have on this. the watch is really a question of what is -- what counts as the beginning of the year?

this is like, is ten minutes late for dinner? is five minutes late? to me if you're going to have the watch in march or april, that's the beginning of the year. so i think people are giving them a hard time. that's within the five-minute grace period to get to dinner. >> do you agree, slava? people -- we had to get over it being a 2015 story. >> i think apple watch coming in early 2015 is concerning. apple right now is having great fall with apple pay hot and obviously the iphone is doing well. i'm a little concerned about fatigue. and then to the point before, about the stores are going to have to change, there's going to be have to be training, all of a sudden it will feel like you're going into a shopping experience for shoes, try it on, try a different accessory. interesting to see how it all happens. >> what do you mean, worried about fatigue? >> fatigue in terms of like we have apple pay, the iphone, i mean i already spent a bunch of money coming up on christmas and then i need to spend more money in february? i mean -- >> isn't that like disney fatigue? kids don't get it, they love

going to disney world and the next ride. >> i think microsoft band, look, obviously, microsoft health band is not going to be a huge threat but i will tell you they've given it a little more oxygen extending into later and beginning of the year. it's been sold out. calling columbus circle since it launched. it was sold out when he went there. not available on-line. i mean it's getting good reviews. say it's chunky but getting nor reviews. >> you have a day job, right? >> i sent the task rabbit to do it. >> what will be interesting to see the convention in vegas come january, it's going to be the battle for the wrist with everybody talking about what they have coming up in that early spring. >> how about johnny ives comments saying he has -- i can't remember the exact words something he feels like the wrist is a very important thing that's going to have long-term potential. him saying that he's absolutely convinced of that. >> yeah. he's had no hesitation in selling this watch ahead of time, right? >> yeah. and the wrist is really important real estate. the issue, a lot of people are

used to not wearing watches on it anymore, various bands, people wear bracelets but can apple make the watch cool again and how will they handle that initial price point which looks like 350 bucks. that's a lot to spend for a watch. most people don't spend that much. will they be able to make it customizable, cool enough for that 10 million or so people to come out and buy it. >> a lot of people paid money for their new iphone and then have to buy the watch. >> those are the people most likely -- >> yeah. but the real story on this is, look at gdp right now and where consumer spending is and people -- this is the only category people are spending on. they're not spending on clothing, not spending on homes, they are spending on electron electronics. people can afford to buy a phone or -- and the watch because they're not buying books. >> and spending on task rabbits too. >> obviously. speaking of spending, alibaba set for its first earnings report as a public company tomorrow. wall street expecting a net profit of $1.17 billion. earnings share of 36 cents. shares have been on a good run

since the $25 billion ipo into september, up about 45% and kay kayla, people said in october, oh, alibaba was obviously the market top. that theory taking hits today. >> especially when you look at alibaba stock. just last week crossing through its ipo crest, from its first day of trading. when i talked to investors there are two things they're watching for in this report. one guidance, but that's pretty common sensecle given this current quarter is alibaba's biggest quarter with singles day. last year did $5.8 billion in transactions just in 24 hours. so that's going to be huge. and they're going to be listening closely to what alibaba says about that. the second thing stock-based compensation which we know for all of these tech companies, small or large, has been one of the most -- the highest levels of expenses for them, especially as they start their life as a public company. alibaba no different. they're going to be using stock to attract new talent and to compensate employees that have stuck around and so that usually is one of the biggest line items

for a company. >> interesting to contrast it after amazon's pretty miserable stock performance after their quarter. >> yeah. one thing that isn't so much a contrast in a way is valuation. how about it. it's market cap is number four in the last that i'm looking at. stocks i track. first apple and then microsoft which is up ahead of google now and then google and then alibaba ahead of facebook. sos there's an argument to be made that alibaba is priced at least to near perfection and they're going to have to continue to show mobile momentum and they're going to probably have to talk up singles day which is coming up on the 11th, next week, a big catalyst day for them, like their iphone launch for apple. >> what i think everyone is going to be looking for, gross merchandise value, what everybody cared about at amazon before they worried about amazon as profitability again. on desk top, gone from 304 in june 13 and crested to 424 billion in december, and now we're looking for 343. year over year that's only 8%. that's a huge decline from 52%

year over year growth they were showing in desk top and then in mobile still seeing enormous gross merchandise growth. 206 billion, 275% growth. if we see any further slowing on desk top, and any less growing on mobile, investors will be very upsetp. it still has to be a big market, big top line story. >> the probable for mobile is that it's less profitable as a business line for the company. they haven't really figured out how to harness it to the same extent as desk top where margins are -- they're slowing but they're still 43%. >> right. >> it's good -- >> usually the first public report after going public, slava the time you want to hit it out of the park, right? >> absolutely. first one goes wrong you go into the penalty box for a few. i expect a good report to come out. it's really important. i think that the number to look at will be the users, did they go up to 300 million users, because it's great to get more contributions to raise to get a

sticky site but you want to make sure you're growing. they're getting 9% outsides the u.s. they're not going to dominate american holiday shopping but interesting to hear them say, in case the people watching, no singles day is not a dating site. it's a way for them to make a lot of money. >> yes. >> think about it as black friday. >> on this take away thing 2.86% on desk top, 1.5% on mobile. i am absolutely convinced from a macro perspective the gap will close. mobile will work just like it worked for facebook, for advertising. i have no fears on that point. >> the high level interesting story like you said, amazon saying to grow you can't have margin and these guys are showing maybe you can have a huge margin. >> exactly. >> finally, add spotify to the list of taylor swift's exes. the singer has been refusing to put a new album on spotify since its release last week and today she pulled all of her old albums from the streaming service. in a statement spotify said we believe fans should listen to music wherever and whenever they want and artists have a right to be paid for their work, and

protected from privacy. company also tweeting we hope she'll change her mind soon. check out what to play while taylor's away, which they were on that pretty quickly. >> the swift fans will get you on twitter first of all for mentioning her exes. second of all i don't understand why any artist who can actually sell an album is on spotify anyway. i mean, if you can -- >> but if you're still building an audience. >> taylor swift has like the entire galaxy, right. spotify turns muse nike advertising for something -- music into advertising for something else. she doesn't need something else. she's selling music. this makes sense. in spotify's case, others don't follow her lead. beyonce and taylor swift -- >> is that what it is? the farm team for music? >> you can window it. if it comes out the last group of people still buying itunes albums you might as well get the money out of them before you put it on spot fi. you see that with new albums. if you can get the revenues from

the albums why not. from the old stuff, she might as well put that on there. the haters will hate hate hate, players will play play play. >> the most fascinating statistic i thought in this whole story was spotify's release said, 16 million of its 40 million users listen to a taylor swift song in the last 30s days. clearly spotify users more than a third once to hear her music. what happens to them and their satisfaction with their overall experience with the site if spotify loses its ability -- >> shake it off. kaye la. >> stop. you have to stop. >> this is still an industry going through disruption. i mean you have spotify who says they're paying 70% of their revenues already to pay for all these rights, you have taylor swift and other artists saying they're not getting paid enough, but really there is the middle players in there taking all their cuts. there's too many middle players and the industry is evolving. i think we've said it, if you have massive amounts of twitter followers or a huge following you have the ability to step off of spotify or one of these other sites but really, you need a lot of this distribution for most

bands. >> yeah. >> or timing might have been perfect. had it on spotify. the number one song. took it away and people addicted to that song need to buy it. >> right. 46 million followers on twitterers. i want a gift of you saying hate hate hate i'm going to build that after the show. >> thank you so much. good to see both of you guys. >> check in on the markets at this hour. we have been seeing a mixed trade throughout the morning session, given the mixed performance of data both across the pond and here in the u.s. ism manufacturing construction spending as well as auto sales, you can see the dow down by 18 points. s&p was just negative but now positive by a point. nasdaq up by half of a percent for its part. we have two deals today, add agency publicist buying u.s. based [ inaudible ] for $3.7 billion in cash rounds out to about 25 dollars per share. lab corp buying covance in cash and stock. we are seeing both of those

stocks react to the deals. >> all right. when we come back, bill gurley says peter thiel is wrong when it comes to one money start-up with us in a cnbc exclusive to explain. plus later we're talking to one of the most active investors in the world. bill maris will join us. a clash for the millennial generation. wasting time on the internet. the teacher of that class, professor joins us later this hour. "squawk alley" is back in a minute. when change is in the air you see things in a whole new way. it's in this spirit that ing u.s. is becoming a new kind of company. one that helps you think differently about what's ahead, and what's possible when you get things organized. ing u.s. is now voya.

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welcome back to "squawk alley." i'm julia boorstin. twitter shares 2% lower on morgan stanley initiating coverage of the stock at equal weight. analyst ben soonberg raising concerns forecasting net income will decelerate saying twitter will make as much money as facebook is, quote, optimistic. the stock is off its lows down 1.3% considering the sell-off since its earnings last week. carl, over to you. >> all right. julia, thank you so much. from uber to air b and b, giant valuations handed out in silicon valley. peter thiel joined us here's what he had to say about both of those companies. >> a giant market keeps growing very fast. investors are always biased to invest in things they themselves understand so venture

capitalists like uber because they like driving in black town cars, don't like air b and b because they like staying in five star hotels not sleeping on people's couches. uber overvalued, air b and b undervalued. bill gurley partner of benchmark and investments in uber and snapchat. good to see you again. we know what sorts of companies thiel is investing in but what was the reaction when he said that? >> you know, i'm not sure that uber and air b and b have anything to do with one another. peter has been on this book tour and he's taken a swipe at uber. can't tell if it's a book tour or smear uber campaign. >> yeah. i mean then there's the interest in lift as well? >> yeah. let me respond to the comment, the comment about vcs. friday night i looked at -- saturday i looked on the apple top free apps chart that anyone can check on their phone and uber was number nine. there aren't enough vcs in the world to put uber at number nine

in the free app chart. uber is the very largest segment of the uber business. this is a mass market phenomenon, not something that is black car only. >> you haven't been shy about talking about warm valuations at large. but is your point that uber is specific, that it is as an dresen might say, a unicorn? >> look, it's -- as i've already been on record saying it's the fastest growing company we've ever been involved with and i think that's why when the company was, you know, put in front of a large number of investors that you ended up with the valuation that it did. the company's having a massive impact on the globe. they're adding 50,000 new drivers a month right now. i mean when you consider that for job growth in the u.s., 250 k is a good number, that's astounding, right. they're adding 50,000 jobs. one company. i don't think there's any other company on the planet having that kind of impact. there's an article in "the new york times" this weekend about what uber is doing to l.a. and how young people, even if they

own cars, only using uber on friday ant saturday nights. having this massive impact on dui. there's liberating things. an article about women in saudi arabia who aren't allowed to drive, who are all of sudden liberated by what the service can do. it's a mass market phenomena, the biggest growth we've ever seen, it's an incredible team. just an incredible team. so yeah, i -- it's a spectacular company. >> bill, on the labor issue, on drivers, i'm curious how this is going to play out. we're seeing drivers saying they're making less, as uber lowers prices. we've had protests here in new york. longer term, what's going to happen here? is it going to be a walmart effect, where drivers just become more part time and even at the higher end of driving it becomes less of a higher-paying profession or does uber expand into different markets for delivery of goods that end up boosting driver pay? >> well, so we care a lot about what drivers make and the

company's published a lot about that on their blogs. there's a recent article that came out where the company published some numbers from new york city where even though prices have come down, utilization has gone up. we've published with the average, you know, take is for a driver. so they may feel that while the rates come down, that that's bad, the actual amount they're making on a per hour basis because utilization is the same. drivers get to choose where they can go and where they can work. we care a lot about what they're doing. there's a reason why 50,000 new people are jumping on this platform every month and that's because the jobs are good, not bad. >> there is a driver bill in baltimore who had a pretty nice fare on friday night, earning more than 360 bucks for what the rider described as roughly a 20-minute ride. i know there are a lot of these anecdotes that come into the market about surge pricing, the company is transparent when it's in effect. i'm wondering if that hurts the mass market appeal of a company

like uber when there's very little knowledge if surge pricing is in effect whether a ride will cost you 60 bucks or in this woman's case $360? >> that's just not true, and based -- i read the same article. sounds like she woke up the next morning and wasn't clear what happened at 3:00 a.m. but that's not true because the app now requires you to type in the exact surge multiple in order to order the ride. so the company is doing everything they can to make sure people are aware of that. if you're worried about it impacting consumer demand i go back to the fact that the app was at number nine in the app store ahead of like whatsapp, netflix, pinterest, i don't see consumer demand abating at all. >> bill, one quick question on twitter. stock is down again today. obviously people were disappointed in the quarter somewhat, but now this lingering echo effect of aimlessness in management, not clearly defined roles, excessive turnover, how do you respond to it?

>> i think, you know, if you go back to the facebook situation, if you remember post-ipo there was this lull where everyone seemed to be a doubter and no one was an optimist, and i think this is that same time for twitter. you made a comment on the -- coming into this where an analyst said he felt that them having the same kind of earn potential as facebook on a per user basis was ambitious. i think it's remarkably likely that they will end up much higher than facebook. people that are using twitter have declared their interest far more, looking at things that are tied specifically to their interest. you can get way better ad dollars when someone is doing that, than you can when someone is sharing photos about a kitten. >> but bill, with this new emphasis on logged out users who twitter seems to have less information about, and people, you know, certainly say more about themselves on facebook as facebook tracks them across the internet, than just what kind of

kitten colors they enjoy, doesn't that shift in emphasis toward logged out users who arguably provide less information? isn't that concerning? >> look, i happen to think that twitter has one of the strongest form network effects i've ever seen, specifically because people like you and me care a lot about what their profile looks like on twitter and every time we get on air, we like to republish our twitter handle and so the company just has remarkable self-promotion that comes from the personalities that live on top of it. they are working on expanding to a farther -- a bigger segment of users. i think they'll eventually get there. i think we're in this period where people are more skeptical than they are optimistic. we'll see what the numbers deliver. >> but you're not commenting specifically on organization or like tactical management day-to-day operations. you have confidence in all of those things? >> i do. i do. >> bill, one recent deal that benchmark did in the last week, you took a stake in tind er.

walk us through the vowel proposition and outlook of that market. >> every week we try to go through and make as list of companies we're not in that are still private and something we could have an opportunity to invest in and the number one company on that list for us for the past year and half has been tinder. and the reason is simply that if you look at different types of social media measurement in terms of engagement, viral efficient, viral coefficient, that kind of thing, this company is phenomenal. the team really did discover a use case and a way of interacting with this double locked in thing they do that is just super compelling to users. so obviously tinder is a unique company because it's majority owned by iac. we reached out to barry and greg and sam and said look this is something we know a lot about, we would love to help you and over a period of time we were able to find a way to work

together. we couldn't be more excited. it's a really compelling product. >> a lot of people are probably curious on how your team did its due diligence on tinder. did you have to sign up for it? >> my partner matt koehler who worked at facebook and linkedin is single so we had someone able to use the product directly. >> bill, while we have you, if you were apple would you be selling bonds in euros right now? >> you know, i won't pretend to know a ton about this, but i've been told that a lot of these debt raising relates to the tax topic that's been discussed quite frequently, so you end up with cash that's isolated in one particular part of the world and then you need to raise cash in another. to offset that for operating purposes. >> yeah. we're in some interesting times. always good to have you. thanks so much for coming on. >> thanks for having me. >> see you again. bill gurley from benchmark. >> when we come back another inside look at startups and valuations from one of the most active investors in the world. bill maris, head of google

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after a week-long hiatus due to daylight saving time it is back, simon back with the european close. >> back and down. a lot of red around today. so i mean you've had the surge over the last couple weeks. that's the content of what's going on. italy down disproportionately down 2% there. late on friday the italian regulator for utilities came through and aggressively cut the tariffs or the price cuts if you like, on the transportation and storage of gas and electricity. that's really going to impact a lot of their shares. let's have a look at the italian utilities in negative territory. goldman says it's aggressive. some of the earnings per share could come down by 30% as a

result. individual movers today obviously publichis buying sape here in the united states. it's an advance into digital. not so much -- we're down 2.3%. it's more that it pushes up the time horizon for share buybacks by some say two years. scrutiny there. ryanair a great session so far today. the irish low-cost carrier raising profit forecast for the second time. the ceo says he's not -- he is worried about the european economy but not how it will impact him because he believes customers are becoming price sensitive on the way in which they travel as they, of course, target business travelers particularly on ryanair. the comments have lifted everybody in the same space. one more i wanted to mention was puma, the german sports wear maker up 8% on the session overall. reuters reporting speculation in

the market that the french luxury goods conglomerate may have found a buyer for its 86% stake. only a rumor at this stage. puma as you can see trading up 8% on the session overall. by the way, ecb is thursday. expect no action but the usual debate. back to you. >> thanks a lot. simon hobbs. when we come back he's invested in uber, in nest, facebook and twitter. you name it. bill maris founder of google ventures will joins us after a break. take a closer look at your fidelity green line 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 to make sure your investments fit your goals -- and what you're really investing for. tap into the full power of your fidelity green line. call today and we'll make it easy

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. since it launched in 2009, google ventures has invested roughly $1.5 billion in 250 u.s. businesses including uber and nest. google's independent arm has its eye on europe launching its first foreign office in europe this summer and making an investment push in life science and health. joining us founder, president, managing partner bill maris joins us at post nine. great to have you. good morning. >> good morning. >> talk europe or health? which is most important? what's the top of the agenda? >> they're both important. we launched in europe, we've hired four partners to help us explore the entire european ecosystem. >> is the timing on this, we keep hearing because of the

troubles the continent has had, valuations are attractive or more than that? >> i think it's more than that. we've been in europe for a long time with camdislondon, a building where it's an ecosystem and accelerator, where we've had window into kind of the europe peen start-up seen. >> how is it different from our own start-up scene? >> not that different. entrepreneurs have vision, want to improegs prove their lives and the lives of their families and make real their dream. it's similar. >> what will the scale of your european operations from an investment and human capital standpoint look like compared to google ventures here at home? >> five people on the ground there now and we've committed $125 million in the first year to sort of explore the ecosystem, but it's hard to say. we started off with $100 million in the u.s. and now we're up to $1.5 billion. i'm pretty hopeful it will grow. >> give me insight into larry page's mindset about something like google ventures, because

innovation is, of course, top of mind for anybody who's investing in google for a lot of people at google and google has different areas compartmentalized for how to do that. how has google ventures fit into that and how has your mandate changed, if at all, over the past two years. >> i don't think the mandate has changed at all. it started out as broad. interested in innovation wherever it might be. it's not limited to silicon valley. that's why we have offices in new york and boston and seattle and london as well. >> how much time does larry page spend on figuring out where your focused, okaying something like the europe expansion? >> larry is not involved in our decision making in terms of our investments day to day that sort of thing. i talk to him often about where we should be looking, kind of where he sees innovation happening and it's a great resource for us. >> walk me through health. give me gran new hairty on health. it's so broad. >> my personal view is that health care stands at the threshold of a real sea change. so when the micro processor,

when vacuum tubes changed to micro processors there was a -- it's really what enabled us to have the iphone and android phones and communicate with anyone any time anywhere and health care stands at that crossroads now where we can read again know mick information in a way ten years ago was impossible. you will see an even more significant change over the next ten years in health care than we've seen probably in the last 50. >> not because of tech per se or mobile, but because of the science? >> i would say -- >> that's the vacuum tube micro prose isser? >> the science. the human genome project took ten years and now you can sequence an entire genome for $1,000 in an hour. you will see something special happen over the next ten years, i think. >> access to medical information, the ability to manipulate it, to provide it, certainly changing with wearable technology and with wireless. how does that impact your

investment thesis when deciding where to put money? >> affects our thinking from the areas, from diagnostic to delivery systems to distribution. one of the great challenges for health care has been the unequal distribution of those innovations. so cell phones are ubiquitous around the world but health care and those technologies penicillin, for example, isn't ubiquitous. the distribution of that technology is something i'm interested? >> looking at a snapshot of your investments in the health science industry you have dock in the box in terms of one medical which we've interviewed the ceo on "squawk alley," you have a blood testing company, oncology data company. there's really no pattern to any of these. how do you choose which companies to invest in and where the opportunity is given how broad it is? >> you draw it back far enough you see there is a pattern where technology and big data intersect with health care. all of the companies we've invested in in health care are technology enabled companies.

so one medical is a great example of rethinking about primary care office from the ground up, using technology. flat iron health in the oncology space trying to organize cancer information oncology information for researchers and physicians. so they all have that common thread. >> do they eventually become [ inaudible ] for google the parent company? >> that's never a part of the strategy. so there are other companies like yahoo! that have acquired more companies that we've invested in than google and so it's always a surprise to me, often a surprise, when google acquires one of our companies. >> finally i wonder, across all sectors are you passing more on pitches than you have in the past? >> we pass on almost all of the pitches we see. it's sort of like it's really hard to tell when the gain is turned up that high if we're passing more. it depends on the industry. consumer internet which sometimes gets overheated we start to look other places. it depends. >> come back. >> i'd love to. >> good to have you. >> great. >> barely scratched the surface.

bill maris joining us. >> thank you very much. >> taylor swift has pulled her album off spotify. you might have heard already. between pandora, youtube and itunes who's benefiting here. rick santelli with the dow down 3. what are you watching today? >> i have to talk about mid-terms tomorrow. yes, tomorrow is a big day. and not just for all the political reasons, but, of course, we need the pizza pie of the united states' economy to be bigger, to feed more, and to be less surgical. federal reserve has tried. tomorrow is the day we can make a bigger difference. we will talk about that after the break. tdd# 1-800-345-2550 [ male announcer ] your love for trading never stops,

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tdd# 1-800-345-2550 ♪ tdd# 1-800-345-2550 your go-to for trading know-how. hi, are we still on for tomorrow? tomorrow. quick look at the weather. nice day, beautiful tomorrow. tomorrow is full of promise. we can come back tomorrrow. and we promise to keep it that way. driven to preserve the environment, csx moves a ton of freight nearly 450 miles on one gallon of fuel. what a day. can't wait til tomorrow. do you guys have identity theft protection? [ male voice ] i'm sorry, did you say identity distribution? no. protection. identity theft protection. you have selected identity distribution. your identity will now be shared with everyone. thank you. no, no, no -- [ click, dial tone ] [ female announcer ] not all credit report sites are equal. [ male voice ] we're good in here, howie. yeah, have a good night, brother. experian.com members get personalized help plus identity theft protection.

join now at experian.com. with enrollment in experian credit tracker. less get to the cme group. rick santelli is there. >> tomorrow's the big day, midterm elections and sixth year in presidency history has it that any president gets a little bit thread bear with regard to the pull and the positive pull he can have on an election day in the final midterm election of their second term in office. tomorrow's no exception. there's a lot of predictions out there, i personally think that you look at the momentum of the last couple weeks and that's something consider. momentum seems to be with the republicans and notion of who controls the senate. but, what we really need to focus on isn't all the politics that have caused us to butt heads as half the population sees things one way and half the

other and that is somewhat represented in the stalemate that we see. i will keep it very simple, the federal reserve whether you agree or disagree with their strategy, i'm not talking about the ecb or bank of japan, i'm talk about our federal reserve, which started under ben bernanke, their heart was in the right place. they're trying to do something. the problem is, is that the pizza isn't growing bigger. you know if you really, really want to look at what's going on in the u.s. economy, we keep getting smaller and smaller. the federal reserve was able to make a difference. they made certain pieces bigger while the whole pie was shrinking, but those bigger pieces you can see in the polls, americans get it. you know, if you're a lucky person that has a pretty decent stock portfolio, if you're lucky enough to have cash where you can purchase property to turn into rentals that's fine, and the central bank made a difference in that arena. but the pie is shrinking nonetheless. and it makes everything a lot more difficult. when the pie shrinks,

everything, every program, comes under funding scrutiny. whether it's health care or infrastructure, and in the end, all those voices are screaming for different things. want to make it easy? if the pie grows, a lot of these things work out. italy, case in point, big debate over the weekend, as to whether quantitative easing, u.s. style in europe, is going to help italy. if it can't help italy what's the point? the problem with italy is they need to make the types of reforms that only the politicals class can be the catalyst to create. you can't create it with lower interest rates or purchases. so every american tomorrow needs to realize, not only do we have the obvious problems we have all the things that the current administration and congress have pushed until after tomorrow's date. certain costs and implementations of health care. in the end, it's an easy decision. if you're worried about various social issues, don't worry. if you vote in pro-growth type

politicians most of those issues will ultimately take care of themselves. >> yes. the election to-do list has grown long. a good reminder to everyone to get out and vote. rick santelli in chicago. taylor swift is kicking spotify to the curb. will companies like pandora, apple, google, possibly get as boost from taylor's breakup? that story is coming up next. you, my friend are a master of diversification. who would have thought three cheese lasagna would go with chocolate cake and ceviche? the same guy who thought that small caps and bond funds would go with a merging markets. it's a masterpiece. thanks. clearly you are type e. you made it phil. welcome home. now what's our strategy with the fondue? diversifying your portfolio? e*trade gives you the tools and resources to get it right. are you type e*?

i'm just looking over the company bills.up? is that what we pay for internet? yup. dsl is about 90 bucks a month. that's funny, for that price with comcast business, i think you get like 50 megabits.

wow that's fast. personally, i prefer a slow internet. there is something about the sweet meditative glow of a loading website. don't listen to the naysayer. switch to comcast business today and get 50 megabits per second for $89.95. comcast business. built for business. famous for singing about her

breakups taylor swift is shaking spotify off, the singer refusing to put her album on spotify since its release last year and today she pulled her old albums from the streaming service as well. spotify responded via twitter saying we hope she'll change her mind soon. in the meantime check out what to play while taylor's away. ops the cnbc news line is btig analyst rich greenfield, tweeted a few of his thoughts on the topic this morning. good to have you. >> thanks for having me. >> so you were basically pointing out that she's still on pandora, which actually pays her a fraction of what spotify had. how long until that goes away too or is there something we're not seeing here? >> you have to look at the big picture here. when you think about spotify, spotify is paying out a tremendous amount to artists now. not only do they have a large free service, but that free service actually is able to upstream you into an actual paid subscription. spotify if you look at how much they pay to artists it's probably pretty easy to see that taylor swift was going to be

making, you know, millions of dollars a year, probably upwards of $5 million a year on her way towards a million dollars a month if you look at the way spotify has been growing, i think the real question that everyone has to be requesting asking is, why would she not want that but more than willing to take pennies on the dollar from a service like pandora, internet radio service like pandora, or even youtube where she puts all of her music up for free for people? >> well, rich, if you want to hear taylor swift right now, apparently a lot do, she has the number one album on itunes, number one and number two songs on itunes, she's got the number one music video on itunes, if you want to hear her now you're not going to hear the whole album on pandora but could hear it on spotify if she put it there. is her saying i'm going to take the most profits i can up front and if people want to hear some things that sound like taylor swift on pandora, fine, but i'm going to maximize profits? >> i don't know. i have an 11-year-old and the minute something not on spotify she goes to youtube and types in the name of the artist and the

album pops up. you know, the entire album is there, either the actual music video via viva or someone uploaded the whole album with all of the words for everyone to stream for free and so i think it's very hard to see in a world where basically all music is available for free. here spotify is actually getting people not only to pay a much higher rate, you know, if you use spotify free, taylor swift and any other artist is making more money per track stream than they would on pandora. on top of that they're getting millions of people to pay for $9.99 a month subscriptions. i think from that standpoint, this was, you know, this is just something that doesn't make economic sense, maybe, you know, they want to simply show a very good download number but i don't think there's people signing up for spotify and saying taylor is not there i'm going to buy it. it's driving them to all of the free options to go get that same content. >> but you don't think it's a dark omen for spotify that you lose some of those in the upper echelons of music?

>> well, look, i think it's obviously not good for anybody in the streaming business when you lose artists. you know, i think if you looked at the article about what global rights management is trying to do, which is the irving jim dolan created venture part of msg entertainment looking at, you know, rig to squeeze a lot more money out of the copyright side of the business or songwriter side of the business and may actually if push comes to shove could end up taking content away from the likes of pandora over time. i think the reality is, you know, artists are trying to take a lot more control of their lives. pulling your music off pandora makes a heck of a lot more sense than pulling it off of spotify from purely economic standpoint you make a lot more money on spotify than pandora. i would have understood if he was trying to remove it from pandora but spotify seems like a bad decision. >> if you're apple and you want to sell streaming subscriptions for five bucks, what does this tell you? >> look, i think we're at the tipping point.

consumers don't want to buy media content. your seeing it with netflix. we think netflix grows from where it is today, towards 100 million subs by the time you get to 2017. you think we're passed that point of, you know, people wanting to own movies. yes, they will be the frozens, certain titles, "star wars" next year where people want to own it but moving to a points wheres there's an important price value relationship. streaming music in order to become far more mainstream than it is today, which i think will be great for artists on a global basis, including taylor swift, the price point of 9.99 is probably too high. needs to get probably closer to 5 -- the 5 to 7 is a critical barrier to get down to. >> rich, we have to go. do you think spotify's campaign to get taylor swift back will work? do you think she would change her mind at this point? >> i think you've seen lots of artists change their minds and i would be shocked a year from now, hopefully sooner than that, shocked ifs this was a long-term decision to keep her music given

how many passionate fans there are listening to her music on spotify. >> we appreciate your perspective this morning. >> thanks. >> wasting time on the internet, that is a class offered at ujc penney -- upen. that professor next. there's confidence... then there's trusting your vehicle maintenance to ford service confidence. our expertise, technology, and high quality parts means your peace of mind. it's no wonder last year we sold over three million tires. and during the big tire event, get up to $140 in mail-in rebates on four select tires. ♪

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as if we needed another excuse to stay connected. next semester students at the university of pennsylvania can sign up for a college course titled "wasting time on the internet." joining us the professor behind the class, kenneth goldsmith here at post nine. professor goldsmith, thanks for joining us. >> glad to be here. thanks for having me. >> the course is listed as a creative writing class. how do you figure? >> they will be required to waste three hours a week staring at the screen and then creating great works of literature out of that experience. >> what type of literature and what are the primary sources that you expect them to be drawing from to get that content? >> if it's on the internet it's game. >> anything on the internet? >> i mean, anything. i mean they can look at political science, write political stories, ingest all the pornography they want as

long as they write great erotica, a right wing site, left wing site, it's fodder for great works of liter ra taout. >> this is amazing, so the question are you tenured? this could go either way, right? >> it will be great. listen, i've been teaching a class at pen for the last ten years called "uncreative writing" where students are penalized for any shred of originality or creativity they show. i teach them to be smart plajerrists. this should go as well as that i'm sure. >> you're taking aim at the broad criticism at the internet that our lives now are very broad, we know a little bit about a lot of things but none very deep. is there anything wrong with that view? >> i think it's a different type of learning. i think it's a different type of engagement. we need to learn to value that type of engagement instead of dismiss it. that's the way it is going now. we tend to put an older form of intellectual modeling on top of what we're doing now, and i think it really doesn't quite

figure in the same way. let's celebrate what we have in front of us and learn to render it into something useful and wonderful instead of dismissing it as being awful. >> so there are only 15 spots in the class you were telling us during the commercial break. how do you choose the people for that? is it already oversubscribed? >> it's oversubscribed, hundreds on the waiting list now, and we will have to pick the best people that are most engaged the most that know the most about the internet, most passionate about the internet. you see literature should follow what you love, and what my students love is wasting time on the internet. i'm asking them to follow their heart. >> lot of people auditing that course? >> you tell "the washington post" you're going to strictly enforce a state of distraction. >> yeah. >> for these three hours. >> you know, when you make a phone call to somebody and you know that they're surfing the web at the same time and listening with one ear, i want the whole room to be in that state of half there, half not

there. we'll have our attention divided, we'll be communally distracted, smartphones, tablets, head phones, chat rooms as long as there's sort of somewhere else. >> sounds like a dream. >> we're going to have to have you back at the end of the semester to hear how the experiment went. >> i'd love to come. >> that does it for "squawk alley." let's get back to headquarters and scott wapner. welcome to the halftime show. our starting lineup, pete is co-founder of option munster, steven is managing partner of short hills capital, joe is senior managing director at vertis, and mike is the ceo of rose cliff capital. we begin today with a new month for the markets and one that historically has been good for investors and a big week we have on our hands as well. the elections thursday ecb's meeting, friday's jobs report and more earnings to