♪ ♪ and welcome to "squawk alley." joining us this morning, henry blojette, the founder, editor and ceo of business insider. >> great to be here. >> jon fortt and kayla tausche on a day where the nasdaq is just inches away from another all-time intraday high. netflix closing in on an all-time high. the fcc as simon said is debating rules that will decide the future of the internet. at any moment the commission is expected to vote and approve new rules that would classify the internet as a public utility. supporters say the best way to

make sure service providers cannot interfere with access. opponents say this gives the government too much control over the web. either way, we're likely to have a decision pretty soon and, of course, it comes wrapped in all sorts of political baggage so to speak. >> it's tremendously complex and the situation we have now, does, in fact, allow big providers to pay more money to get their content there faster. it's very complicated. i think the best answer from most sides is you want do what encourages competition. ultimately that's the thing that is going to make it best for everybody. >> is that a yes vote? >> i don't think so. in fact, i think mark cuban's position we'll hear, is look it is working. it's not perfect, but it's working and you've got big guns on all sides but they know there's kind of a stalemate here and things are developing. that's his position and his position as you get involved with the government trying to write out everything and specify it, that you're going to complicate things, going to phrase something differently, everyone is going to suddenly try to come around the new

rules. lot of folks are arguing and it's compelling, try to eliminate monopolies in certain markets, bring in competition, ultimately we just want bandwidth is what we want in the problem is, their already seem to be monopolies in certain markets and that's what proponents of the rule are arguing. the "new york times" has an interesting graphic where it shows at the fastest two internet speeds some 60% of households only have one choice for an internet provider right now. it seems henry, although some of the providers have been able to invest their profits in the infrastructure, it has come at a cost for the consumer. >> yeah. >> but the market is starting to work. wireless is starting to come in. they're starting to be over options. if we just encourage that we're going to get to where we want to be. >> i wish the camera would take jon trying to constrain his laughter. >> at the fastest internet speeds, yes, that is important for consumers. dsl versus cable, remember when that was a fight. the slow skies. whose commercial was that

comcast? comcast owns us. what this comes down to i think again is competition an the fact that this isn't over. we expect the internet to get faster. and the problem, i think, is that people just don't trust the cable company and that's an earned reputation for a lot of cable companies. the customer service is horrible at a lot of cable companies. people feel like -- >> huge priority for those trying to fix it. >> maybe. i don't know. i haven't seen it. from my own consumer experience. but i think it's come down to people feeling cable companies will slow down those who don't pay, that they believe that's going to happen versus give as faster lane to companies that can afford to pay. normally if you say, hey, i'm going to give you something for free because the company is going to pay for it people love that. that's the idea behind google. the reason google is free is because advertisers are paying. on the internet they don't trust the cable providers to do that. >> how about this netflix tweet yesterday and they tweeted one line, one word at a time, as if to show a slow pipeline, what if

the internet was so slow it loaded one word at a time don't let comcast win. do they not have a point? >> of course they have a point. it would be terrible and we don't want the single point of control. that's why competition is important. >> the whole argument is comcast is so much faster than everything else you can get they have too much control and yet the argument is, don't let comcast slow down the internet. they're not slowing it down because they're so much faster than dsl nobody considers it to be competition anymore. >> if you are comcast you can have sympathy or a fan of comcast hey, come on when we built these pipes it was e-mail. netflix, every night, you are flooding the pipes with all this stuff we have to put more pipe in the ground, shouldn't you have to pay something extra for that and the answer is yes, in a lot of cases. it's an incredibly complicated issue. >> that's my question. who does the cost ultimately befall? some of the companies like netflix and start-ups, many of which stream video, are saying this would be extremely costly for us. we couldn't afford to put our

content through the pipes whereas consumers are saying, well otherwise we get left with the bill too to stream the content we want. which end should the cost fall on? >> this is where you once competition. you want a couple of powerful players, at least, in the market. you want a wireless solution. it's why everybody is drooling at the thought of living in the cities where google is bringing fiber to the curb and house and so forth because you have choice. that will solve it. ultimately if an internet service provider wants to play games and say we're going to throttle netflix and someone you can go to that says whatever you want, it's just a pipe, take it. that's what everybody is going to go with. we need that economy petition. >> netflix within four bucks of an all-time high. facebook above 80 for the first time, would close for the first time this year. we'll see. we will have a lot more on net neutrality this morning. dallas mavericks owner mark cuban never afraid to speak his mind will join us to talk about the future of the internet in a few minutes. according to the journal google's youtube is still not making money.

the article cites sources who peg revenue at the video unit at about $4 billion in 2014. that's up a billion year over year despite the jump the bottom line is still break even after paying for content and equipment to deliver all those videos quickly. they compare it to facebook which is able to cobble together 3 billion in profits. >> that's fine. youtube is a force for the next generation and it is gradually, if google doesn't blow it and no signs they will blow it, it is going to gradually take over the world. you look at the viewership numbers, look at the revenue, they are now a reasonable size cable network in terms of revenue closing in on cbs as a broadcast network. ultimately this will be a colossal, global business and viewing platform. just takes time. >> i'm not sure i buy this. i'm not sure how many costs you to assign just to youtube in order to say it's not profitable and how many revenues you have to not assign to the fact that google has youtube. you know what i mean? google now is selling

advertising in packages that include lots of different pieces. so it seems to me, reminiscent of six years ago when the stories going around about how youtube is not making any money. that used to be the argument. and facebook isn't making money either. turns out they made a bunch of money. what else probably isn't profitable. google maps but it's tra steejically very important. it's very good. and amazon by the way, isn't turning that much of a profit but i don't think anybody is arguing that's a failure because they're making strategic -- >> i think a lot of people argue that. >> the criticism is youtube as a platform is not sticky. people don't go and stay there. it's not a habit. they go because they're directed by an outside link or something else that leads them there. some third-party provider. you don't just go to youtube the same way you sit in front of a television and watch something you didn't expect. you always know what you're looking for when you go there. >> there are scale advantages there, though, the infrastructure, the fact that they have a social network implementation where you follow folks and get their new videos.

the fact they have hundreds and thousands graefts content providers all over the world building their platform on youtube and making a living doing it. >> we've had them here on the show. >> it is tremendously powerful platform and only going to grow but to your point, kayla, one area where google could invest saying okay, now we will get some longer form, super popular stuff that is only here going to have to log into youtube to check it. still early days. they are in a great position over the next 10 to 20 years. >> jeff bezos is an investor. amazon 387 on the mcquar which note. talking about prime membership doubling by 2020. >> that was an extraordinary note. don't see a lot like that. >> good seeing you. >> great to be here. >> henry blojette of business insider. >> not just amazon, but the broader nasdaq up 13 points. dow is turning positive as well, up 12 points after being down

pretty sharply after jobless claims ticked above 300,000. we saw an increase in layoffs in the texas area. s&p for its part down a fraction of 1 point but looking like it's hovering near the flat line. some other tech movers, tesla, facebook, google rallying while apple is down about 1%. apple about 10% of the nasdaq composite. carl it would be crucial to getting to the 5,000 level. >> when we come back we mepsed at the top, any moment could get the decision from the sec on the future of the internet. who better to talk about it than mavericks owner mark cuban with us after the break. just under 12 hours from now, "house of cards" season three goes live. one of the show's top producers will tell us what we can expect from president underwood and company. elon musk's hyperloop sounds like a pie in the sky project but one state making it a reality. the dow has gone positive and the nasdaq within 20 points of

5k. we'll be right back. [ female announcer ] who are we? we are the thinkers. the job jugglers. the up all-nighters. and the ones who turn ideas into action. we've made our passions our life's work. we strive for the moments where we can say, "i did it!" ♪ we are entrepreneurs who started it all... with a signature. legalzoom has helped start over 1 million businesses, turning dreamers into business owners. and we're here to help start yours. anyone have occasional constipation,s owners. diarrhea, gas, bloating? yes! one phillips' colon health probiotic cap each day helps defend against these occasional digestive issues... with 3 types of good bacteria. live the regular life. phillips'

the nasdaq in an echo of yesterday and pretty rarefied area, within 20 points of nasdaq 5,000. we're around these levels

yesterday. it's only cracked 5,000 seven times in its history and open closed above 5,000 two times. interestingly, we were looking back, 2002, it was at 1114 if you can believe that. the mark haines bottom we talk about a lot here, 1268 and the anniversary of that is coming up next friday. march 6th of 2009 was 1268. nasdaq now 4981. >> pretty staggering move when you think about where it's come from 2009 until here, when you think about the 2,000 move that's a move starts getting described as parabolic be. you could argue from the move from fwn to now is sharply in one direction. >> remember 1268. >> i do remember 1268. interesting to see which stocks this month have powered that move from the nasdaq. apple and microsoft among them. >> yeah. the fcc open meeting is under way in washington this hour. we're awaiting the commission's vote. as we look at the live shot

joining us by phone dallas mavericks owner and "shark tank" costar mark cuban. always good to have you on the program. good morning. >> good morning. thanks for having me. >> any sense as to how this is going to go? >> of course. they're going to vote for it. 3-2. >> and they let the courts begin. >> let the lawsuits begin. the courts will rule the internet for the next however many years. >> you've called this silicon valley group think. what do you mean by that? >> i don't think anybody is thinking it all the way through. look, we're all for a fair and open internet, right? let's just take it all the way through its logical conclusion. all bits are bits, all bits are equal. if all bits are equal then let's look at what a stream bit is an example. when henry and i do an interview and stream lived on the internet, there's a camera, it goes through an encoder sends it out via server or some manner to the internet, click on business

insider and watch the screen, right. let's look at cnbc on comcast. there's cameras in front of you, they go through a switcher, through an encoder, it's put through a server, it goes to comcast and it's streamed in a managed service environment to television. it's the exact same thing. and if it's the exact same thing technologically and all bits are equal, then why shouldn't cnbc and all tv networks that are delivered on telco and fiber like verizon, why shouldn't they be part of the open internet as well? if they are and all bits are equal let's take it one step further. it's the per view of the sec now. the fcc, right? the fcc now has to apply their same standards to content, don't they, that they do to television content because that's where it is and there's going to be certain citizens who think well now, all content is delivered over the internet because all bits are bits and it's a fair

and open internet decency standards. remember the fcc is the same agency that fought nipple gate for eight years over a wardrobe malfunction. >> yeah. >> we're not done yet. >> we're not done yet. there's more. >> i think it is the only thing that has surpassed nipple gate in garnering as many public comments. a lot of people are watching this. many share your logic. the fcc in 2010 tried to regulate the internet and the court system struck it down. >> exactly. >> that's expected to happen this time, not necessarily the court outcome, but that it will go to court. >> yep. >> and the courts back then found that fcc didn't have the enforcement authority to regulate the internet. what is different now? the fact that the white house has gotten involved as well? >> verizon decision came in and opened it back up. the white house, obviously, has an impact and let's go through that logic. chairman wheeler had one position that was different than now. now then the verizon decision comes along. then we get the president of the

united states giving his position. then chairman wheeler changes his. now we have the vote that we're having. does anybody really think that it's going to be any different for future chairmen with future presidents with a future makeup of the fcc? there's going to be, i don't even know, a whack ka mole environment going forward on our internet. it's crazy. >> mark, jon fortt here. >> hey, jon. >> what happens now is my question? clearly people who agree with you, lost the marketing round on this one. net neutrality and title 2 -- >> you hit the nail on the head. they lost the marketing. they got crushed. >> title 2 and net neutrality together, as if they're same thing, came to mean the free and open internet. round two or round three or whatever round is next, what is the argument from your point of view that's going to win the masses over to thinking well maybe round one didn't go to the

right -- >> i'll give it to you simply. your tv as you know it is over. >> all right. >> you want to expand on that, mark? >> i just did before. right. when you -- when -- let's say there's 250 channels on comcast and they all have four mega bits. right. that's with what they're enkoidsing at right now. four mega bits times 250 not part of a paid managed service and now part of the open internet and you have to click on cnbc to get the live stream, now what you do is you just put 1 gigabit into the open internet that solves your bandwidth problem but takes away your tv. you have to go like we went through the digital transition with the fcc and spent billions of dollars on new set top boxes for everybody to get digital over the air you need a new set top box if you want your it tv to resemble anything at all like what it used to. your tv is gone. but wait, there's more.

shopping channels like qvc over because they're paid prioritization pay to be on comcast and others, right. they pay. gone. their pay prioritization over. you have to go to qvc if you want to and they're like any other website. want your tv like you've always had your tv forget about it. now look, the reality is, they'll sue, people will sue to prevent that from happening. politicians will all of a sudden realize what's going on. the fcc will say this is a managed service and we always excluded managed services. because that's a managed service, everybody and their brother will try to make their delivery of a stream a managed service as well and that's going to fall into paid prioritization and there will be a big kerfuffle and everybody will fight it out and things will stop. an that's the problem with net neutrality. if you love the internet the way you know it today, this is what you're going to have for a long time. if you're like me and think the best is yet to come, then you don't want the fcc involved because of alls the uncertainty. >> do you have hope that as it

works its way through the legal circles you mentioned it will wind up the way you think it should be? >> no, absolutely not. >> this is just a big obstacle? >> it gets worse. there is no better when it goes to lawsuits. i mean look, henry and i had to deal with the fcc where they basically invented new law -- created new scenarios they could take through the courts to invent new laws. this is no different. right? look at the fcc as the past. there was a previous commissioner, i was reading something that chairman wheeler wrote when he first came to office, and one of the early -- one of the commissioners 20, 25 years ago was smart, they allocated spectrum for wireless. but his position was, we'll do it, but wireless is a frivolous application. and because he felt it was frivolous, it got delayed for 15 years we would have been way further ahead had it not been delayed the way i read what he wrote. there's so much uncertainty that's introduced because a, you have the courts, who knows what's going to happen, who knows who's going to sue.

it could be that, you know, jon fortt is suing because people want pure a la carte and don't like his segment and don't want to pay for his segment on cnbc when they go to the website. >> we know that's not going to happen. >> of course not. you see the absurdity when everything is sent to the courts. >> how about -- >> and then we will have a new chairman in two years probably. >> yep. >> how about absent whether you think the vote should be yes or no, these concerns that house oversight has over the process about wheeler not testifying, about coordination -- >> lots of transparency, right? lots of transparency. that's the fcc, that's the department of internet that we're going to get, no transparency. >> wow. so -- >> jon, you still have the same position? >> well, i mean, yes. but to me, to me, a core issue is, people trust regulation, the government, more than the cable company. >> you hit the nail on the head. when is demonization of three companies a good enough reason to introduce legislation or bring a regulatory agency in to

try to oversee an industry? >> that's why i'm skeptical of the effectives if of your argument as good as it might be, if you argue now your tv is going to get screwed up, people are going to blame the cable company for that too. >> oh, no, no, no. not the cable company anymore because it will be fcc rulings that get us there, right? the fcc is going to have to be the one or reading of fcc open internet again bits are bits and if all bits are to be created or treated equally, you can't give priority to delivery of a television stream in a managed service. pure end of story. the reality is, only two laws that matter. moore's law and met caf law. the laws that have driven innovation and caused people, entrepreneurs like me, geeks around the world to keep on pushing the envelope and the envelope is being pushed right now. that's why there isn't a need for regulation. >> throw in a footnote, met

calf's law says the value of the network is the number of end points squared. >> with internet of things, you know, inedation to social networks and things we have -- we haven't gotten to the things we haven't thought about. >> many things will be powered by the wireless companies which some of them don't seem to have a problem with the way the rule is written. sprint and t-mobile said we're fine with this. meter data doesn't seem like a viable alternative for consumers. that's probably the most expensive way to go to charge per bit, per thing that they're watching. >> i mean, do you know any wireless companies that don't charge per bit at some level? >> yeah but -- >> some unlimited but then they tamp you down in terms of -- >> most of those have been rolled back because of how much data they were having to provide. >> what does -- >> what point you think that pricing gets regulated as well? >> why did the fcc decide to include wireless? you know. in reality, a lot more things are happening, a lot is happening technologically in

fiber and delivery and fiber or delivery rather over wireless with point of site. a lot of exciting things happening in the wireless space, but now if you have to ask for permission to introduce them, or have to ask for permission to take out existing wireless infrastructure, it's going to screw the whole thing up. again -- >> we are -- >> we don't know the best is yet to come. do we think the best of the ber snets is about movies and netflix. i'm a huge netflix shareholder. but at the same time it's not the best of the internet. we don't know what some 12-year-old boy or girl will invent that makes it so much better but we've introduced the risk of the court system and the fcc having to oversee it. >> yeah. we are getting opening statements, mark. fcc chad dickerson about to speak, we're told. so we continue to be on the lookout here. a look at mr. dickerson. speaking of netflix, have you heard from them? >> no. >> on this issue? >> no. why would i? >> i means just -- >> they don't care what i say.

enough people do either, you know. >> and while we have you and while we're waiting on this vote, i can't help but look up at the comp and see 4981. can i toss a valuation question your way. >> yeah, i mean value is what people are willing to pay. i don't think we're in a bubble per se, but i think we're in a momentum market without question, where people don't -- the market is so complicated and so difficult to understand these days, and not so much driven by value that people go where people are and invest where other people are investing and so that's why you see, you know, big run ups in stocks and certain stocks, not all stocks, see big run ups in certain currencies, big run ups in certain commodities and then they pull back and everybody jumps somewhere else. it's just so difficult to understand, you know, what's the difference between correlation and causation that it's almost im possible for individuals to invest. i've got companies that i think

are leaders in their market and then i just try to stay hedged and get out of the way and just hope things go my way. >> sounds a lot like that old while the music is playing, mark, got to dance. is that still fit? >> that's true, but that's also why most people are not in the market. you know, i saw some surveys that said the number of people that check their stock prices every day has declined from 70 plus percent 20 years ago to 30%. when people talk about money on the sidelines, to me, if people are not checking the stock prices they're not going to consider putting their money in the market. they will put it in funds and they will put it, you know, where they think it's safe, but i don't see this as the market anymore where video investors come in and i think -- i'll throw it on my old nemesis the fcc because they have no clue what they're doing and people don't trust the market. >> we always know we'll get it straight from you one way or another. >> i just want to know if jon fortt has changed his mind yet. >> mark, i agreed from the

beginning. my question is whether people will buys the argument because it was such a tough sell this time around. >> they did a horrible job marketing but the one thing people definitely don't understand is with this regulation, however it comes out, one, it's not going to increase investment. there's no scenario where people will invest more money, no scenario you will get more competition because of the regulation, you know. it's crazy. it's just, you know, i just don't understand. look, the whole decency thing and the whole regulation of the internet, that's why i'm shocked how is ok cue his rift and facebook going to be able to deliver virtual reality content on-line without paid prioritization, google be able to manage self-driving cars in an environment they have to put it over an open internet and it could buffer. >> thinking way ahead. talk to you soon. >> any time guys, thanks. mark cuban owner of the mavericks. >> the nasdaq still close to 5,000. about 19 points away.

top executive at morgan stanley is going to break down how things look now versus then. plus, frank underwood is back, well, in about 15 hours anyway. one of the top producer from "house of cards" will join us to break down everything you need to know about season three. "squawk alley" is back in a minute.

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security funding for blackmail to protect the actions of the president where the president said he didn't have the authority to dos this. yesterday the white house press secretary said this is a fight amongst republicans. it is not a fight amongst republicans. all republicans agree that we want to fund the department of homeland security and stop the president's executive actions with regard to immigration. meanwhile, president obama told a left wing blog he opposes senate filibuster, but he sat there like a bump on a log watching senate democrats filibuster the debate on this bill. we're awaiting to see what the senate can or can't do and then we'll make decisions about how we're going to proceed. finally, the president's national security adviser says it's destructive for the prime minister of israel to address

the united states congress next week. i couldn't disagree more. the american people and both parties in congress have always stood with israel, nothing and no one should get in the way of that. but what is destructive in my view is making a bad deal that paves the way for a nuclear iran. that's destructive and why it's so important for the american people to hear what prime minister netanyahu has to say about the grave threats that we're facing. so i'm glad the prime minister is coming and i'm glad that most of my colleagues, democrats and republicans, will be there to hear what he has to say. [ inaudible ]. >> that was house speaker john boehner in his weekly briefing. just three days away from a partial shutdown of the department of homeland security as we near a vote in the senate on that issue. believe we have john harwood in washington. john, this is not the first time this week we have gotten harsh words out of speaker boehner.

how effective will they be this time around? >> well, we kind of know how this thing is going to end and mitch mcconnell's action and separating the immigration legislation from dhs funding is a sign that in the end, republicans know they're going to have to fund this agency. the question is, how do we get there? the senate is goings to pass that funding legislation either today or tomorrow, depending on whether conservatives allow a faster vote, and then john boehner will make a decision and you heard tough rhetoric from him but no commitment as to a course of action and i think what he's trying to do is to use that rhetoric to hold off for now the conservative base by going after the president, not just on dhs funding, but also on the comments of susan rice, the national security adviser, about benjamin netanyahu's speech next week and some of the tough talk, i think, is a way of keeping conservatives feeling that john boehner is on their side and

eventually they're likely to have to give in on this. we don't know when that's going to happen and whether there will be a shutdown before it happens. >> john harwood in washington, thanks for bringing us up to speed on that. meanwhile we're watching the markets where the dow is back in negative territory. the nasdaq is up by about 13 points. 4980 is that level right now. climbing toward that 5,000 mark. what are the capital markets telling us about where we are now versus the dotcom bubble. here on set to discuss more is raj, cohead of global capital markets at morgan stanley. thanks for being here. >> thanks for having me. >> one of the differences people like to draw between then and now is the relative quality of the ipos we see in the pipeline. there were a lot, they were really small back then, and there's some real companies with real revenue this time around. what does the pipeline look like and what are the companies telling you about the market? >> from around the world we have a really healthy pipeline. companies are -- we've had healthy ipo pipeline, healthy followen on and private

placements and companies go public later. they've been introduced to investors through the private place and market often times and it's a robust and attractive market. >> there's some people who say maybe now the bubble is in the private placement market, maybe something that vcs and other buy side investors are the ones exposed to now. $50 billion in private placements last year. that's nearly triple what we saw in 2000. what does that tell you? >> tell, as you say, the private placement market has really exploded and in fact, together with u.s. ipos, that's a record, the amount of issuance. the private placement market is much deeper than it used to be. not just vcs, long only pension and mutual funds, sovereign wealth funds and almost four or five times the number of investors. >> so then what happens when the companies go public? normally retail investors would buy into an ipo as a way to ride value creation going forward, if it's the mutual funds a and some of the later stage guys getting in earlier, is it more just

dilution, weakness that the public market is buying in when the companies go public? >> as you say the ipo market requires sophisticate the investors and i think today's private placement, pre-ipo financing is like an ipo ten years ago. in terms it of the investors, the sophistication. we do get participation from high net worth individuals in private placements. so it's well represented across the investor base. >> michael kors is an example that comes up a lot. a company that had a lot of private money, used the ipo to replace those investors, soared 183% since then. but there aren't that many companies of that caliber out there. is there a risk that there are not that many? >> there are fewer non-tech companies. michael kors is probably one of the best examples. a company that had founders that needed to exit in the course of nine months they raised almost $2.5 billion and a lot of what we do as experts on ipos, was

important in preparing their private placement. and the ecosystem of a private placement and ipo and then the follow on that helped michael kors is really core to what we're doing these days. >> you spent a lot of your career, most of your career in the debt markets and we're seeing fascinating trends there. i looked up the average interest rate for companies to borrow in europe, below 1%. here in the u.s. 3% for some of the highest quality borrowers. why would any company issue a bond in the u.s. when you can go overseas and get the rates there. >> the dial up with clients is not just financing. it's around hedging and taking advantage of the some of the dislocations around the world. we launched the deal for coca-cola overnight. it's going to be one of the largest deals since 2009. they're going to raise almost $10 billion. the coupon will be less than 100 basis points. that's as close as you get to zero. it affords large sophisticated companies the opportunity to offset some of the headwinds they get at the top line from a

strong dollar. >> elsewhere in the debt market people are concerned about the oil prices, how that affects the cash flow of companies that have borrowed. are we at the point where there's a panic, we're below 50 on crude, but we've seen some capex pullback, haven't seen many defaults, what are conversations in your world like with some of the borrowers. >> oil has stabilized a bit. some of the real distress steam were concerned about is not going to play out, not right away. the high yield credit markets were affected early on. you will see m&a and more distressed opportunities play out later in the year. >> would you say that is something not to try at home, that's something that distressed hedge funds, sophisticated investors should buy maybe not the retail investor? >> i would. i certainly -- i certainly would say that. i think that these moves in oil and interest rates and currencies, it really has encouraged corporations to have a point of view and to really rethink their hedging and risk management. it's an important part -- >> i'm sure a lot are thinking

about it after the effects fx had on earnings this season. rank raj, appreciate your time. >> happy to beer. >> fair amount of green in europe. simon at post nine. >> absolutely. we made gains on the european equity markets through the session. the data not bad, spanish gdp growing, record low on german unemployment, 6.5s%. they always had traditionally higher rates natural unemployment in europe for the reasons you know about. what is interesting is while you still have record low unemployment in germany the german bund the yield on the bund, continuing to move further down into record low territory on the session today. the zeal continues for fixed income in europe for government bonds. as mark cuban said on the program it ten minutes ago, people go where people are and very shortly you know next thursday when the european central bank fires the gun on qe it will be forced according to the rules to buy $12 billion --

sorry 12 billion euros per month of german bunds. that's what the rules are. buy it now, you can actually have a negative yield, pay the german government for five-year paper and you know the ecb will be coming in and buying behind you. it's for the capital appreciation that you would buy these instruments. couple stocks the heavy restructuring continues at rbs, royal bank of scotland. 80% owned by the taxpayer, writing down the value of the citizen, $6 billion, substantial job losses at the investment bank. they shrink from 38 countries to 13 and selling $37 billion of loans in this country to the japanese. meantime allianece cut dividends at pimco after bill gross exitd but because property casualty insurance is down. that stock marlee lower. the greeks are concerned we had a trial vote amongst the conservatives if you like in germany today.

looks like the full vote in the lower house for the greek deal will go through tomorrow. as expected. meantime the greek banks are lower. the question there remains whether or not the greeks will have to go to the imf for emergency assistance before they get the spoils of the package. back to you. >> indeed we'll see. thanks, simon. up next a lot of people thought the hyperloop was a wild idea from elon musk until now. two companies have plans to build real live hyperloops in california. the man behind one of them joins us when "squawk alley" comes back. there's a difference when you trade with fidelity. one you won't find anywhere else. one-second trade execution. guaranteed. did you see it? in one second, he made a trade, we looked for the best price, and the trade went through. do the other guys guarantee that? didn't think so. open an account and find more of the expertise you need

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from xfinity. hi, everyone. i'm sue herera. here's your update this hour. ibm is targeting $40 billion in annual revenue from the cloud security and other growth areas by 2018. that aggressive target set by company executives at its annual investor meeting in new york city this morning. in a cnbc exclusive, ibm ceo guinea rometty will be live on "power lunch" at 1:00 p.m. eastern time. isis released a video showing militants using sledge hand hammers to smash artifacts in mosul. they date back to the ninth century bc. nbc cannot confirm the location of the video. jay carney according to politico will be a senior vice president

for worldwide corporate affairs. and how does billionaire investor warren buffet stay healthy? he eats like a 6-year-old. he told fortune magazine he checked the tables and the lowest death rate is among 6-year-olds so he decided to eat like one that includes the occasional bowl of chocolate chip ice cream for breakfast. mr. buffet will be on "squawk box" this monday. that's our cnbc news update this hour. let's get back to "squawk alley". the race is on, elon musk's vision for a high-speed passenger pod known as the hyperloop is one step closer to becoming reality this morning. one of the known companies competing to capitalize on musk's proposal announcing it struck a deal with land owners in central california to build the first full-squall hyperloop along a stretch along i-5 with construction set to begin in 2016. phil lebeau joining us with a

first on cnbc interview. >> thank you very much. let's bring in dirk albern who runs the hyperloop transportation technologies team announces this deal. tell me about the deal and really when you expect this hyperloop, this five-mile stretch, to be finished? >> so, quay kwally is supposed to be breaking down in beginning of 2016 when we start working on our development, so we will be starting ground at the same time. at this moment we expect to be 2018. >> dirk, the big question is, it's going to cost you $100 million to build this five-mile stretch. where are you getting that money from? >> so, our company has announced we're going to do a public offering at the end of the year. the reasoning behind that is actually that our whole company is crowd powered. we want to make sure that the people that have been helping building the company and this technology, are able to

participate in the investment in the fund-raising of the company. >> right. but you're looking for $100 million, at least for that ipo, later this year. this five-mile stretch is going to cost $100 million. i mean some people will look at this math and say you need more money and a lot more commitment from people who are going to have to take a leap of faith in you guys? >> well, so, you know, this is a phased approach that will be a test track. elon musk announced he will build a small-scale test track and assume they will start building at the end of the year. that's the information we're hake. it's a necessary step for us to be building a full-scale version and quail valley is a sustainable model town, 21 century, so, you know, it's a perfect fit. they're expecting over 10 million visitors per year, so we will actually be able to generate revenues very, very fast. >> dirk, real quick, how fast

will people be traveling in the five mile stretch when in the hyperloop? >> so, speed is probably the only thing that we are not going to be, you know, optimizing here as much as people would like to. you have five miles so you can't really get that fast. but it's very necessary to do everything else so passenger loading, capsule handling, you know, we expect that we will be doing i think we can reach 200, 250 miles easily and then we will -- when the passengers are about to use the first hyperloop we're probably going to drill it down a little bit and, you know, so you don't feel the g forces that hard when we're accelerating and stopping. it's a short trip so it's not really necessary to have the capsule going that fast. >> dirk all burn, the man who runs hyperloop transportation technologies which today announcing a deal struck with the developers in quay valley

california, they will build a five-mile stretch of their version of the hyperloop for all those who said this is just a neat little thing to draw on a cocktail napkin these guys are saying it will become reality. >> future is now, phil. thanks a lot. great tough is it. to chicago as well, cme group, rick santelli, hey rick. >> hey, carl. you know, that old song, "drifters made under the boardwalk" we will call this under the bored walk. where, you know, don't ask any questions, under the bored walk, we all have to think the same, under the bored walk. why do i call it the borg walk. whether the science, science is never settled or asking questions and the real focus of this santelli exchange is all the stories and all the anxieties and energy associated with a couple of duly elected congressmen asking janet yellen questions that many believe kind of crossed some line. there's many that believe a $4.5 trillion balance sheet ma i have crossed some line, plenty that

will admit a lot of the issues facing us are historic in nature and the me sin we're trying to quell the issues with is historic not only in the united states it's across the globe. we also know that perception in many ways is a reality. so for congressmen who, by the way, created the federal reserve, congressmen who by the way in 197 7 created dual pilars, who could come back and say stable prices doesn't mean 1%, doesn't mean 2%, it could be minus 1% as long as it's stable, so i don't understand all the anxiety. we're at a time in history where asking questions and kicking tires is frowned upon. now i understand that maybe this is against protocol. i understand that there's a hoopla of similar fashion with bb netanyahu speaking against protocol, but some would think phones and pens are against protocol. i go to the times that we live in. we do live in times that we

should be asking questions. there's a lot at stake here. we're not sure how it's going to turn out. and i think i'll finish this with one of the greatest quotes and it's from that 19th century famous german philosopher, frederick nicha, all things are subject to interpretation, which ever interpretation prevails at a given time is a function of power and not truth. back to you, kayla? >> all right. thanks so much, rick santelli, in chicago. when we come back, "house of cards" season three drops at 3:00 a.m. eastern. one of the show's top producer will join us coming up next. well, sir. after some serious consideration i'd like to put in my 15-year notice. you're quitting!? technically retiring, sir. with a little help from my state farm agent, i plan to retire in 15 years. wow! you're totally blindsiding me here. who's gonna manage your accounts? this is a devastating blow i was not prepared for. well, i'm gonna finish packing my things. 15 years will really sneak up on you. jennifer with do your exit interview and adam made you a cake. red velvet. oh, thank you.

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coming up, a stunning move by one of our traders in his halftime portfolio. you won't believe the trade and neither could we. plus, where in the world is the best place to invest? gemma godfrey is live with the answer. as the nasdaq nears its all-time high are there any values left? all that and lots more coming up top of the hour. we will see you in a little more than five minutes. >> our next guest a producer on hit films like captain phillips and "fifty shades of grey." he's also been a producer on all three seasons of "house of cards." the latest of which will premier on netflix this friday. joining us from los angeless is dana brunetti. good to see you again. >> same, carl, good to see you as well. >> i'm going to guess you can't tell us anything about the plot but going into season three how

do you fight what they call show fatigue now that underwood is in the white house? >> well, forpeople that haven't seen season one and two you spoiled some of it. now he's there and has the power that's where the fun begins. so it's still his rise to power and his ascension, so there's still that interest and that story. and then there's a lot of other, you know, inner workings and stories we have and a genius with the writing staff and the interest and intrigue that he creates is still amazing to me. >> you mentioned those who haven't seen seasons one or two. what's the statute of limitations? when are we able to discuss plot points? >> i don't think you ever are. i think you have to first say, did you see season one and two before you can start talking about season three? >> dana, jon fortt. to be fair it's obvious that they're in the white house where that picture is being taken and then the commercial trailer. i'm wondering, boston sort of

begged for an early release of "house of cards" given that they were snowed in. you know if netflix considered it? >> not that i know of. i wouldn't do it. we have a schedule that we stick to and they should move and live some place elsewhere the weather is better or go on a vacation during those days. we accidentally released the first ten episodes when they were uploading them or getting prepared to run on friday and they were live for about 23 minutes. so i think some people got a quick sneak peek at stuff. >> on a more serious note, "fifty shades of grey," you were involved in social network. it occurs to me, these are stories of billionaires, rich, dangerous people. are we in an era where those types of stories about that personality more interesting? >> i think we've always been in that era where, you know, people of intrigue are interesting and

billionaires, although in social network mark zuckerberg wasn't a billionaire at the time, that was the creation of what ultimately made him a billionaire, they're totally different stories, but of interesting characters. those are typically the type of stories that i zone in on, i always say amazing minds do an amazing thing from 21 about the mit card counters it to social network, captain phillips, amazing mind doing an amazing thing and christian gray as an interesting character and an amazing person in a lot of ways, although fictional, it's a very intriguing individual that people want to know more about. >> dana, obviously a lot of people want to get in the streaming space. amazon, we talk about all the time. yahoo! with community. do you pitch all of them now? does one have a head start over everybody else? who is the biggest competitive threat? >> i mean look, it's a whole new ball game and it's fantastic and scaries at the same time for my

industry. for me as a creator it's a wonderful thing because it's more places for me to go and shop my projects, so as opposed to just going to the typical, you know, traditional networks and cable companies around, i now have other places to go that will bid against and hopefully if they're interested in the project, so going to amazon and going to netflix and all the others that are popping up and going to pop up, it's a fantastic thing for creators like myself and the audience because it will give them that many more options. >> "sesame street" put out a parody of "house of cards" you know you made it when sesame takes you on. >> that was one of the more funny parodies i've seen in a while with the big bad wolf going to blow their houses down. that's a lot of people said -- at first i'm like did "sesame street" really do that and they have. >> dana brunetti riding the longest winning streak in

history, always good having you. >> knock on wood. appreciate it, guys. >> and as we await the release of "house of cards" at 3:00 a.m. eastern time tonight, netflix shares up about 1.25%, good for about 6 bucks hitting 484 and change today. pretty stunning run year to date one of the leaders on the nasdaq 100 today followed by google and avaggo the only two advancing further than netflix today as we inch closer to 5,000, comp up 15 points. >> netflix shy of 489. brunetti told us when we taped that yesterday, we asked would you prefer viewers binge viewed "house of cards" or not he said this season he watched the first six and then he's going to watch the subsequent whatever it is, four or six, along with the rest of america because there is something to watching it with people. >> shared experience. sales force less than 2% from an

all-time high and so is facebook. good day for the cloud. >> still waiting for some word from the fcc. ibm ceo with faber going to be an interesting day. back to headquarters, scott wapner and the half. ♪ all right. thanks so much. welcome to the halftime show and meet our starting lineup. jim lebenthal the president of lebenthal asset management. joe terranova senior managing director at virtus investment partners and jon and pete najarian co-founders of ohm. our game plan today looks like this. usa versus europe. zm gemma godfrey on why the best bang for your buck is across the pond where stocks are outperforming. the government and internet the vote that matters to every one of us happening in this hour. we are live in d.c. with the winners and losers for your money and watching the nasdaq, of course, as it gets closer to