♪ welcome to "squawk alley." joining us jon steinberg the ceo of daily mail north america. kayla tausche is here. jon fortt is in barcelona at the mobile world congress. hearing from john in a moment. let's begin with the markets today. red again as sara and simon just said. biggest two-day decline for the markets since january 27th and 28th. for most of the day, not a single dow component has been in the green. oil, stubbornly hanging on to 50 or at least close to it after an amazing build in inventories and bertha keeping us honest on the

nasdaq. good morning. >> good morning. the nasdaq only closed above the 5,000 level twice back in 2000, has yet to be able to put together a second day as we were lower today. one of the things we're seeing here is the nasdaq big caps are actually outperforming just modestly some of the other small caps and the large caps today. facebook, yahoo! among the gainers. apple back above $129. that's helping bring the whole composite back above from the low. cisco one of the major drags today as well. but again, we're seeing the selling happening in the chip sector. chip sector helped propel us above 5,000 a couple days ago. yesterday hit hard. again the biggest decliners, one of the areas that often is sort of a sentiment tracker. san disc is bucking the trend. yesterday san disk out with news and today a little push on the fact that on its new flash storage it broke the $1 barrier

for storage of a gigabyte of information pushing things lower, helping the stock higher today. biotechs another sentiment indicator. biotechs selling off again today. we're watching health care in particular. insurers like anthem, a hearing under way at the supreme court right now over obama care subsidies. justice anthony kennedy the swing judge often on that court apparently just challenged the constitutional argument of the plaintiffs, but he says they could still prevail in this case. it's really tough, carl, to read into the question and answer session during these hearings. it was a very interesting thing. one of the issues that people have talked about is the constitutional challenge whether you can really talk about the actual wording versus the actual intention of the law. back to you. >> you got that. made that mistake before trying to read in the justices' reaction with prior challenges.

bertha who covers not only tech but health legislation very well. thanks a lot. john, let's talk about the markets. 5k was that it? >> it's just a confluence of bad things. yesterday a ten month low in car sells and netanyahu speech. wake up a payrolls number which comes in 3,000 jobs light of expectations. exxon saying they're going to reduce capital spending by 14%. and then i mean whether or not you want to build this abercrombie miss. the consumers not spending because of low oil prices. exxon and everybody cutting capital spending. isn't much good today when you look at the past 24 hours. >> art hogan in the 10:00 hour called this a moment of vertigo we did reach record highs. the nasdaq did top 5,000. our john malloy on cnbc points out not only did it not spend twos days above 5,000, only about 45 minutes above that 5,000 level. certainly did seem as soon as we hit that psychological level, carl, there was demand to actually pull that back. we have a beige book from the

fed today. the ecb meeting tomorrow and this new imposition of qe and then the jobs number. a lot on the table for investors to wait for that could be a catalyst from here. >> not to mention we had netanyahu on the hill talking about bad times ahead. >> yes. >> and gave people some fear. at the same time, these numbers on the cash levels, basically for tech companies that are parked overseas, $2.1 trillion now. >> this is the issue with the tech stock prices. either their afairly priced or upper end of average or have a lot of cash, they're not growing like google and everybody saying give me back the cash. you're not getting the multiple expansion. basically, it does feel like we're at a reasonably priced level. i don't see us going much above 5,000 if we get back to it. >> all right. let's zero in on alibaba this morning. shares in the green but the stock is near its lowest price since that ipo back in september. alibaba is also down nearly 22% this year. now during the ipo, we did ask executive chairman jack ma how

much he really watches the stock price. here's what he had to say. >> when people have high expectation on you, the very important i tell myself and tell my team, be ourself. do whatever we believe is right. i don't dare to watch the stock price. this is the other people think who you are. when people think you are good you have to be sure whether you're really that good. when people think you're bad, we have to be clear whether we are really that bad. >> more on alibaba this morning. the company expanding on to american soil opening a new cloud data center in california. that's classic ma, right? customer first. shareholder second or sometimes third. >> yeah. >> when you wait to go public when your company is $200 billion and the growth is slowing, you know, what are you going to expect investors to do? i feel the comparison to jd is unfair. jd a $37 billion company. obviously would have higher growth and accelerating growth rates. this is not a young company.

this is not a small company. massive upside, massive things to go into. they're koipg everything amazon does a little bit. it's a big company. >> like it or not, however big this company may have been when it went public, the first four quarters of any company's public trading, it becomes an event driven stock. investors have knee-jerk reactions whether it's a lockup. $382 million in beijing and light, further its content investment and trying to stockpile content for that offering and then, of course, carl, the government concerns. whether it is doing enough to stop fake orders, some of these venders on the site. new complaint about them putting up fake orders to make it look like they're doing more business than they are. when a company is that far away and it's newly public, it's hard for investors to get their head around it and figure out how can this impact the stock. does it matter. there's not enough data points. >> i don't think it's newly public. this is a company that's been quasi public for years.

been in the yahoo! stock, so many private investors trading shares for years and years. we will see the exact same thing with uber when uber goes public. >> doesn't it add to the complaint that we're in an age where by the time the company does go public the growth is gone and retail investors are left holding on to a name they want to own but not nearly as attractive as early on. >> still has a price to earnings ratio in the mid to upper 30s. it's like, you know, i mean what do they expect on this thing. advertising revenue growth slowed from 20% in the two prior quarters as well. it's a middle-age company that people are trying to pretend is a youthful company. >> meantime this hillary clinton e-mail story is getting a little more interesting. according to ap today, clinton ran her own computer system for official e-mails from her family's home in shap chappaquiddick new york. the times said she used a personal e-mail address when she was secretary of state. it's important because clinton a

presumptive democratic presidential candidate would have almost complete control over archives from her time in the white house. a server protected by the secret service in upstate new york. >> what's amazing about this the state department said there's no indication she used classified conversations on this system. and she had other methods of communicating. i mean that's a little bit bizarre. i don't know how in 2009 you communicate without e-mail. maybe she wasn't sending classified documents through this thing but it's a little weird. it wasn't technically illegal. in 2009 she had to do document retention on e-mail but allowed to use a private system. i just don't quite get it. i mean i would like to use my personal e-mail for everything. i'm just a corporate executive. i can't do that. i don't know how the secretary of state is able to do this in the modern era. it's so bizarre. >> talking to people in the tech industry they say this actually isn't a surprise to us, that the fbi, the cia, some of the clandestine services do sometimes do professional work

on their gmail and personal e-mail because you can attach large pictures and documents and type in different languages other than the english alphabet and the government servers and the government e-mail systems don't allow you to do that. you also have to ask the question, now i don't think this was necessarily the issue for hillary, per se, but ask the question of whether the government is doing enough to modernize its own technology to advance into the age we're now living in. >> let me give you one charitable assessment. she got in there. the government e-mail system was so frustrating and so lame, i don't know what it is, maybe it was, she said i can't deal, i send a million e-mails a day. >> can't be effective. >> i'm setting up my own thing. you know, look, we've all come into legacy corporations with terrible e-mail systems where we ant to tear our hair out. that's the most favorable interpretation i can give. >> after healthcare.gov, i.t. is not a problem for the private sector exclusively. >> was she on gmail or yahoo! but it was clinton mail.com, ma

some secure instance she spun up. >> this is someone who had reason to be concerned about leaks a year into her tenure as secretary of state we did get that massive wikileaks of 250,000 plus state department cables. that did expose a lot of her private conversations with diplomats abroad. those were on e-mail and cables. something she had top of mind in her tenure. >> what a story. just an amazing story. continues to get more interesting. mobile, congress getting ready to wrap up in barcelona. jon fortt is there taking his time coming home apparently. good morning, jon. >> >> good morning, carl. let me give you the three big takeaways from here and flavor from barcelona. first, gadget bling and when i talk about gadget bling i mean things like phones. i caught up with jk shin, one of the ceoss of samsung after their announcement on sunday here. i asked him which model of the

galaxy s6 is most excited about. he said the edge because of the manufacturing process and i'll tell you, they need this phone to gain share. he does in particular. his job is sort of on the line. but also, virtual reality has been big here, not only did samsung update its version but htc showing off virtual reality here. se sony not here talking up the latest version of its virtual reality at a gaming conference and wearables here. all of these companies trying to reach for the premium rung again with the xhods tizing pressure which i'll also get to and apple dominating at the high end. there's been a focus on the enterprise here. we had blackberry talking about their cloud and apps, how important those will be. the cloud for small, medium business, apps for driving their software strategy. we also had some giants including red hat here and sap, talking about the importance of mobile and ibm is here showing

off some more of those apple ios apps part of the partnership here. then finally, the profit squeeze in mobile. it comes from two directions. first the hand sets. $40 even $30 smartphones becomes an actual thing here. the ceo of arm had one. he was talking about it. take a listen. >> about a year ago the low-cost devices were new and everyone talking about them. as you go around the show here now, it seems like that's a mature idea and there are phones that literally every price point. >> >> and there's also a squeeze at the other end and that is the carrier end of things. you've got these messaging apps including whatsapp, taking away the sms revenue. mark zuckerberg here trying to say we are not your enemy even though we own whatsapp our test in internet.org have shown people want data. you can make it up in volume of

data plans if you give people a taste of what they want and zuckerberg's argument part of what they want, of course, is facebook. i caught up with one of the biggest sports stars in the world, also the partner of shakira, one of the music stars in the world, he's gerard pk, not just a star with fc barcelona soccer here, also an entreprene entrepreneur, mobile gaming company, a game on ios, golden manager, where you're a soccer manager. we were talking about that. he said even his friends are playing and it's at the top of many countries' app stores. take a listen. >> show that games, to your friends, other players. >> yeah, definitely. some of my teammates in the dressing room are playing every day, asking me for more money. they don't want to pay. i said you money, examine on. -- come on. it's funny. it's really funny. some of my friends that i had friends from the school a long time ago, they play too.

it's great. >> these soccer stars got a lot of money but everybody wants a little free something in a game. especially if you know the guy who owns the company. really nice guy. but europe looking to be on the come up here with mobile and with gaming. they missed the round in technology after dotcom. they were supposed to be the driving force in mobile with nokia and sim beyan. now guys like gerard pk are trying to come back in apps. back to you. >> fascinating conference and an hour from now, mark zuckerberg is going to host a town hall style q&a. >> speaking of mobile, apple surpassing samsung which held the number one spot since 2011. >> samsung keeps losing market share to xiaomi. whenever you hear an executive talk about, you know, specs and megahertz and manufacturing processes, it makes the hair on

my neck go up a little bit. people don't care about manufacturing processes. when i looked at the samsung curve i thought yeah, it's kind of cool, but what is it going to do. they eliminated bloat ware. >> you were impressed with gopro, for instance. >> i was. actually the fact it's coming out and they are going to bring it to the u.s. potentially with the app store it's not clear what's going to be available or not available. it shows you how terrifying hardware can be. easy for somebody to be replaced by a slightly better manufacturing process. it's about the experience and that's what apple is really proving out in the past few quarters. >> we will learn more next week, aren't we, kayla tausche. >> we are. that is true. >> i can't wait for that watch event. i mean i have to go to my calendar and make sure i'm not doing anything to sit and watch the live cast. >> get up at 3:00 in the morning for "house of cards" you can get up for this. >> i'll be up for the watch and order yours as well. i do that for friends. >> jon steinberg, daily mail north america. >> the apple watch is going to

flop says one writer at fast company. he will join us to make that case. plus the billion dollar un y corn club is larger. one e-commerce company with a fresh billion dollar valuation is joining us. for facebook, virtual reality could come sooner than you think. live to the game developers conference in san francisco to discover facebook's plans for virtual reality and how it could change gaming forever. the dow, coming off the lows. still down 119. "squawk alley" continues in a moment. [ male announcer ] your love for trading never stops. so if you get a trade idea about, say, organic food stocks, schwab can help. with a trading specialist just a tap away. what's on your mind, lisa? i'd like to talk about a trade idea. let's hear it. [ male announcer ] see how schwab can help light a way forward. so you can make your move, wherever you are. and start working on your next big idea. ♪

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and welcome back to "squawk alley." take a look at shares of tivo moving higher to the tune of around 3% after reporting better than expected earnings last night. earnings per share came in at 7 cents versus average estimates for 4 cents a share and tivo reported 1.3 million subscription additions last year a record for the company for the past quarter as well. the subscription numbers came in better than analyst expectations. back to you. >> all right. thanks so much, dominic chu. it's been a year since facebook bought virtual reality headset maker oculus for $2 billion and mark zuckerberg has been hard working to make that investment pay off. our julia boorstin is live at the conference in san francisco to explain.

julia. >> mark zhuk berg wants ook cue lus to be the operating system that powers virtual reality. the competition is going to be tough. with game giants including sony's morpheus and newcomers like htc's steam headset fighting for market share. this is a brave new world for facebook whose only experience in the game area is in the casual game space, games like farmville, not hard core games, suited for oculus the developers we spoke to here are working on. >> you need games, apps, you need things that make it appealing to people who don't know what virtual reality is. if that gets ironed out, approach concept developers they should be golden. >> they have to gets the hardware out there and with the announcement about the steam headset there will be competition out there and they have to get people developing for them rather than the enemy. >> facebook announced a deal with samsung to launch a store for samsung's oculus powered vr

headset to enable developers to sell their games. >> it's really important for developers to actually be able to make revenue and for a long time talking about vr but nobody can make money from it. they are taking payments you can start seeing revenue come in. >> sony's morpheus has the advantage of a playstation user base facebook in contrast is trying to position itself to help developers sell their games for a range of hardware and it's going to take a cut. so facebook should make money by selling its headset and also by selling the games. kayla? >> it's a long game for facebook, certainly, julia, making the investment in that. we appreciate you bringing us the latest. when we come back, uber is worth about $40 billion, but the company hadn't made a single acquisition until today. we'll bring you all the details when "squawk alley" returns. ameriprise asked people a simple question: in retirement, will you have enough money to live life on your terms?

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in case you missed it, uber has an acquisition in its headlights confirmed by mashble. the company will be closing a deal for its first acquisition ever. the company is decarta, a mapping tech start-up. uber saying the acquisition would fine tune its products an services that rely on maps. travis in september at a conference said uber has not done an acquisition, a boasting point for the company, but we don't know how much they're spending but this is a very important part of growth for uber. >> as travis starts to show up on the lists of the wealthiest individuals in the country at least, continue to watch uber closely. europe about to close in about 4 44 1/2 minutes. >> we made gains on markets through the session. the data a bit disappointing with the revision down on the pmi. the sales figures were strong led by germany. the bigger picture tomorrow european central bank detailing how it's going to buy 60 billion

euros of debt across the eurozone as of presumably monday. what's important on the euro slipped to a fresh low getting cheaper to go on holiday than last year. there you go, 20% cheaper to travel there now. we've not been down at this less since 2003. euro crashing through important support here down a cent on the session overall. tomorrow they won't say thou how they're going to buy sovereign debt they're going to release projections for inflation and growth and how long a better idea for how long they're going to be on this qe. could it be more than 1.1 trillion euros easily it could be and back to your assumptions whether interest rates will rise in europe again and how much money will continue to flow out of europe moving $4 trillion through this particular exchange rate. that's really a conversation for tomorrow. we did have a lot of companies reporting in europe today. dividends were a main topic. axle springer one of the -- hang on, want to mention greece,

forgive me tell you where we are, a lot of people are concerned that the greeks will run out of short-term money. today they successfully managed to auction $1.1 billion of t bills, short-term bills, higher interest rates in the market. on monday they will go before the european central bank at the eurozone with six reform ideas to try to get that cap lifted so that these banks can survive. obviously there's a huge question about the liquidity and the retail deposits though those have been swelling. back to the corporates we're reporting today. dividends were a key issue today. axle springer, a real disappoint on their dividend, top gainer today, actually the main commercial broadcaster in the united kingdom. itv has a special dividend it's going to deliver. people love what itv is saying at the moment. they are still in the exclusive talks to buy tallper from john duemall the great prolific tv producer from the netherlands behind hits like "the voice." itv up over 6%.

back to you. >> thanks a lot. let's get over to dominic chu watching the proceedings at the supreme court this morning. hey, dom. >> that's right. so one of the things we're watching is the battle taking place at least with some of the health care names, hospital names specifically, you look at tenet health care and universal health care, some of the operators up big in today's trade. see from about 4.5 to 7.5% this comes as the supreme court is hearing a case that could decide the fate of the affordable care act, known as obama care. supreme court justice anthony kennedy saying today there is a constitutional problem with the way that challengers of obama care are reading this particular act here. those stocks are helping the s&p health care sector turn positive now for the day. down market but hospital stocks and health care, carl, showing signs of life here today. >> same with the broader market, down 175 on the dow, down 113, thanks. when we come back the billion dollar unicorn club continues to grow. one commerce company with a fresh billion dollar valuation will join us live.

according to one writer at fast company the apple watch is going to be a massive flop. he's with us to make his case later this hour when "squawk alley" continues. at ally bank no branches equals great rates. it's a fact. kind of like shopping hungry equals overshopping.

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i'm sue herera. here's your update at this hour. secretary of state john kerry met with iran's foreign minister for the third day in a row in switzerland as they try to hammer out a nuclear agreement. in a spirited rebuke to israeli prime minister benjamin

netanyahu kerry challenged critics of the deal being negotiated to come up with an alternative. russian president vladimir putin said the murder of boris was a disgrace to russia that in a televised speech. it is the first time putin has made public remarks on the shooting. activist investor starboard says staples needs to improve its board but didn't suggest any candidates. starboard said the company which is awaiting approval from regulators to acquire office depot could be worth between 32 and $37 a share that would be more than double where it is right now. microsoft co-founder paul a allen is an explorer and he says he's discovered a world war ii battleship, 70 years after it was sunk. the japanese battleship was discovered in the waters off the philippines more than 8 years after he began his search. and that is our cnbc news update for this hour. let's get back to "squawk alley."

thank you, sue. meet europe's newest tech unicorn. marketplace far fetch announcing this morning it has raised $86 million in series e funding led by jiri miller in's dst valuing the company at $1 billion. the london based retailer offers access to more than 300 luxury fashion boutiques worldwide. joining us is the company's founder and ceo josay nerve vis. good to see you. >> thank you for having me here. >> i have to say, i discovered farfetch just last week. i was led there by one of the fashion aggre graters. poly war the name of it. the first that i had heard of it. i'm wondering what the selling point is and strategy to get the name out and expand the business beyond europe where you're based. >> no. >> yes. farfetch is a new way to shop for fashion. we basically provide access to 300 of the world's best

independent luxury retailers. we can shop the streets of milan, paris, new york, l.a. and tokyo, et cetera, and you are right in that we have to do a lot of work in terms of raising brand awareness, and we've just launched our first line in the u.s. and here in the uk and so that's going to be advertising taxis, transportation, et cetera. we're hoping that will raises the brand awareness, but we do have a very loyal -- very loyal customer base around the world. >> an it's not just retail for those who aren't familiar with it. similar to your competitors, mow to operandi, you're not just retail, you're editorial. why do you need to strike that balance in this day and age?

>> so first of all, we are a community, we're a marketplace so we don't hold inventory unlike the other websites. so we're really a platform for physical stars, stars that exist out there, and we like to shop the stars and handle all the logistics, customs on behalf of the customers so the customers have a great experience. services rather than inventory based model. >> obviously it's a global story. a lot of dealings in a lot of different countries. obviously at the high end, any reason to be worried about the high end consumer in countries like brazil? >> of course. when there are headwinds like in brazil we do notice in terms of the rate of growth, but brazil to give you an example the e-commerce and sector in brazil

is expected to grow 20% this year. so we talk about a country that is not growing or is actually potentialry in recession, but e-commerce continues to grow and in particular the luxury, it's a very, very low on-line penetration. we're talking about only 5% of luxury fashion is transacted on-line. so macro economics really don't play a huge role in our forecasting but although, of course, we're not completely immune to those. >> and obviously today's news that you've raised $86 million from the likes of yourry miller in which has a fantastic track record having invested in facebook and uber and a lot of other big companies that's nothing to sniff at. the billion dollar valuation how much to you as a ceo is that a status symbol for your company? >> i think it's -- you know, first of all it's obviously not

an arbitrary evaluation with our business with revenue, with real matchings and with fantastic growth, so that's obviously triangulated by the investors, not just [ inaudible ] but the other investors who participated in the round and compare with transactional marketplaces and on-line retailers that are public. of course, for the team that has built this business from nothing seven years ago it's a huge milestone but modern evaluation is the ability to accelerate growth and continue to fulfill our mission. >> and jose we will continue keep our eye on you. we appreciate you joining us on "squawk alley" this morning. >> thank you. >> joe say neves ceo of farfetched. >> when we come back we talked about oculus and if target has its way you will use it to

browse the aisles of your local stores. exclusive video you do not want to miss. in the meantime rick santelli with the dow down 98 what are you watching? >> there's only one thing to watch. ecb meeting tomorrow and only one word to know, scarcity. scarcity. here we're going to see the ecb outline, the logistics and the operations behind purchasing 60 billion euros a month of securities where are they going to find them? we will talk about all the rox they will be looking under after the break. [ 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!"

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pause or pull back? stocks coming off their worst day since january. so how do you trade it right now and is the u.s. really the best place to invest? calling a bottom in oil. one big investor is doing just that. what do our experts think? is mcdonald's in for a super sized comeback? one analyst thinks so, upgraded the stock today. he will defend that call live top of the hour. we'll see you in about 15. >> we will be there. thanks, scott. shoppers increasingly use their digital devices to fulfill everyday needs, retailers are on the hunt for the holy grail, that is, something that could bridge the divide between their physical stores and your mobile device. courtney reagan joins us with a look at one retailer's newest experiment. courtney. >> kayla, a number of retailers, including target, walmart, and american eagle are planting a flag in the bay area and in

silicon valley to be close to social media and tech titans that influence shopping but also to attract top talent and fuel innovation to beat the forefront of our future shopping habits. at target san francisco lab i was virtually transported to target's express store near the university of minnesota using oculus goggles. why? not so distant future target thinks it's possible we will be browsing the aisles of our local store without leaving the house, here using a game as a simulation of what it might feel like to virtually pick up a product, read a label, place it in the cart, physically. for target the goals of the lab initiative are twofold. >> we're looking for great talent to come in and join the organization, but also for our guests to know we'll continue to innovate on the daily challenges that they want to see addressed. looking at where can we go in the future that may surprise people, that's not just about what happens within the four walls of target but addresses broader consumer need and market opportunities. >> and one of those market opportunities that target is working on is the concept of the

connected home. this is a diaper dispenser that sends a notification to your smart phone when your diapers run out making reordering a snap. engineers designers and data at san francisco's target office are working on a dozen ideas at any given time. target also has a sunnyvale location dealing primarily with dana analytics. carl? >> courtney, i just have a quick question because oculus, obviously, is pretty far off from being an everyday consumer product. what was target sense as for how long it could be until we actually see this in our lives? >> exactly. they're not necessarily giving us a timeline. they just sort of say they need to be in a place where all of these sort of inventions and innovations are coming to market like the oculus goggles so they can have them, experiment with them and figure out how they might use an oculus gogel to help a shopper down the road. it's not something coming in the next year. the connected home will probably

be much sooner. >> the stock enjoying a nice day. record all-time high going back to target's ipo back in 1967. thanks, courtney. courtney reagan at hq. over to the cme group, rick santelli with the santelli exchange. hey, rick. >> hi, carl. excited day on the trading floor. traders are eagerly awaiting the announcement tomorrow on the subsequent press done frens regarding the ecb, but before we get into the specifics of why they're so excited it always has to do with money, let's look at the landscape that we're walking into tomorrow morning. the euro as you see on the intraday chart breached 111 we're trading 110, around 110.75. these are going to be freshes passes. i don't know the close. i only base technicals on the close. it's going to comp back to the fall of 2003 as we continue to extend the last time the euro was valued at this level against the greenback. maybe the last chart is the most important or the most interesting at least.

bund yields are around 38 basis points. if you look at the range, subsequent to the last ecb meeting on the 22nd, this is pretty much the high-end of the range. i don't think many expected the bund yields to do that but many expected the euro to get weak. they didn't think it would be in a tight range right up until today to break out. now let's consider, okay, tomorrow we're going find out logistics. logistics are important. we're going to find out how they're going to buy these things back. will it be like the fed? the fed used to have the reverse auctions at 11:30 eastern. how are they going to do it? the fed chose to buy from primary dealers. maybe it was just too much advertising about kissing your sister if you bought it directly from the treasury. and let's not forget, that when you middle man these things, especially when the programs are on the buy side of securities that may have been recently auctioned, the tealers get to make money on that. the only topic that ever matters is money. what's going to happen tomorrow

with regard to the idea that you have rates in eurozone that are negative out to the six year and the seven year last year was briefly in negative territory. are we going to see more negative rates. when you look at bunds the deepest most liquid fixed market in the eurozone but even they aren't going to afford themselves into the camp that will equate to 60 billion euros a month. who is going to sell? i talk ability scarcity in the ts. everything is squares, that's good. like ferraris versus vegas. central banks bought the ferraris and everybody else gets to drive the vegas. which leads me to who exactly are going to give up their ferraris because of the scarcity of getting such quality sovereign paper like bunds or treasuries and heat going to be a huge -- that's going to be a huge issue. think back to our markets did interest rates go up and down in perfect cyclical frequency, what

central bank, our central bank was doing, they did not. back to money again. because front running, see, there's a lot of hedging in global perspective, lot of u.s. based hedging that got in front, bought portuguese paper, bunds, italian and french paper we know they're going to be sellers. are they deep enough to accomplish the mission of a repetitive purchase program out to 2016, the fall of 2016. i question it. maybe the most important question and nobody kicks the tires in my opinion on these big issues, is what's the point? are we going to see the german sabers penalize more, get more negative rates, is that going to fix what's going on with europe? we'll leave it with one chapter. we need a new chapter on why prices move up and down at a time where financial assets have a huge amount of inflation. why is that? because everything we're talking about the ecb doing in my opinion is going to make pricing even worse. and to clear that inventory

you're going to need lower pricing. any questions as to why disinflationary arguments seem a little strange at this point in the game? back to you. >> thank you very much, rick santelli. it's going to be an interesting day tomorrow, rick in chicago. we're keeping our eye on washington, d.c., oral arguments have ended at the supreme court as plaintiffs challenge the state subsidies as they relate to the affordable care act. the case is king v burwell and the news wires are trying to parse the questioning and trying to establish what kind of decision we mitsght get. the dow jones did say justice kennedy questioned the merits of the plaintiffs' arguments and on the back of that we have seen a marked turnaround in insurers and hospitals. take a look at aetna today, cigna, unh on the hospital side, fen net health, community health, people are believing that the plaintiffs' arguments had holes impossible to know and dangerous to guess. >> it will still be as you

mentioned several months before we get the decision that is expected. people say around june. but we are seeing those insurers broadly lift the rest of the market, carl. i mean we've really trimmed losses down now, down by 99 points. had been down as much as 171. nasdaq down by about 14. s&p down by about 11. even though we are still in the red, we are off the lows of the days and that has been led by the insurers. >> cashin saying definitely -- the bulls want to hold 2085 to 2090 and we've got a few points above that at 2097. to washington as quickly as we can when we get news out of there. in the meantime dow down 99. back in a minute. ameriprise asked people a simple question: can you keep your lifestyle in retirement?

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story of the morning quickly turning to health care. insurers hospitals, the arguments do end this morning in the latest challenge to obama care at the supreme court in washington, d.c. our hampton pearson is there live. what can you tell us? >> essentially had a standoff in close to two hours of arguments over the notion of does the affordable care act allow the irs to provide tax credits to individuals who purchase health insurance on a federally facilitated exchange. basically four individuals were challenging that saying no, it should be state only exchanges. that's a strict reading of what's in the law. well, we had arguments on both sides fierce arguments and fierce challenges from the

justices about the meaning of those few words, whether it's just the isolationist view if you will that it should be state only exchanges, where those tax credits are available, but the government on the other hand making a powerful argument the whole idea of the affordable care act frankly falls apart if you have such a narrow interpretation. okay. so the justices, again, some fierce questions on both sides a and we really don't know how the court is going to rule on this one. essentially challenges from some of the more liberal justices supporting the government's view you have to look at the subsidies as part of the whole scheme of the affordable care act. some of the more conservative justices saying wait a minute, if you apply what we the court are supposed to do when we just interpret statute, and that really was the issue here, there is room for the plaintiffs' charge. you could take a strict interpretation of this law.

the interesting thing throughout all of the argument, chief justice john roberts was silent in all of this and he was, of course, the swing vote three years ago in approving that the individual mandate was constitutional and giving life to the affordable care act. tough call, tough arguments on both sides, but now really pivoting the ruling will be pivotal to how the affordable care act goes forward. and we'll have a decision in late june on that. back to you. >> hampton, because this might be unfair but you are sort of our eyes and ears out there, some of the stocks are responding to the upside among the insurers and hospitals, because of some of the dow jones headlines regarding kennedy. is that how it rang to you in the room? >> well, justice kennedy raised the question that if you buy the government's notion that essentially you could be two-thirds of the states if you

will nigmight have to shut down federally run exchanges and looking at a catastrophic effect on people losing insurance and the insurance industry, then kennedy raised the question, well what about that? how do we deal with this? does this now raise this to a constitutional level question. that was the show stopper in terms of how the argument went back and forth and generally speaking, you would say well if you're listening to kennedy, that might give a slight nod to the government's position which might be why you're seeing the reaction in terms of those headlines to some of the health care related stocks. >> yes. but as we've learned before, caveat em tore trying to guess what the decision may be months from now. thank you very much. hampton pearson outside the supreme court. in the meantime more details about the apple watch expected to be unveiled at an event in san francisco next week. however, our next guest wrote an article in "fast company" this week, you guys realize the apple watch is going to flop, right?

joining us mark wilson joins us from fast company, good to see you. >> good to see you. >> are you essentially say this is like a vanity project for jony ive? >> that's what it sounds like. i know that doesn't sound kind but "the new yorker" ran a 16,000 word piece in which they went inside the apple lab and what they say very indirectly is that ive has become obsessed with rolexes and bentleys rather than the democratized designs that brought us the iphone. >> but there's a sense that the apple is only expecting or analysts are only expecting them to sell about a tenth as many rolexes as sell in a given year for the high-end of the apple watch. they know they're not going to get there overnight. you disagree with the other analysts who say expect about 23 mill on average to be sold this year. that's not nothing. >> you know, i don't know what i think the apple watch will sell this year alone. i think it will sell millions of

units. i do compare it to the iphone or the ipad, right. the iphone sold 100 million in three years. the ipad sold 100 million in two years. i do think that the sort of hype level is implying that the apple watch will be as big as those devices and i just don't see it. i don't think the technology is ready. the battery that's in the apple watch can run out in as little as 2.5 hours if it's on all the time. which is why apple's designed it to be asleep most of the time like your phone. so people literally will be wearing watches op their wrists that have nothing on the screen most of the time. and i think that's a bit absurd and don't think consumers are going to buy it. >> you point out, you say we live in the apple era and by real demand or smart pr the first run will surely sell out. by flop what's your definition of flop? talking like 10 million units in the calendar year instead of 14? >> i'm talking the big play. will apple introduce a smart

watch category and take over, right? that's as large as something we've seen in tablets or smartphones which are the best examples that most of us are sort of pointing to. i think my definition of flop is between 50 and 100 million units in a few years. i'm actually not that interested in what happens over the next six months to a year because i think apple loyalists can drive that traffic. i want to see how this trend plays out in the few years, and i don't see it playing out in a few years. >> i think we would agree that apple's products in the last few years have created even more apple loyalists than perhaps existed around the time of the iphone? >> yeah. apple can't have a flop as you know it from most other companies, right. so apple will never release anything that sells a few thousand units or even 1 or 2 million units now. apple has gotten too big. they have too big of a following so there's no circumstance in which that's possible. what i'm asking is, is the apple

watch really an appealing enough device or useful enough device that will hit the 100 million person barrier to make it relevant? >> you'll admit that a lot of that will depend on the developer base, right, and the pricing two things we hope to learn about next week which you arguably have zero visibility, is that fair to say? >> that's fair to say. we know it's going to debut around $349 but the big question is, not just are developers going to show up. developers are going to show up. apple shouldn't be relying on developers to show up to make the apple watch relevant. the iphone was relevant years before it had apps. think about that. the apple watch should be relevant without having those developers show up too. >> yeah. it's true. the divide between form and function, we'll see how important both of those are. it's a provocative piece as always, mark. good to have you. >> thanks. >> mark wilson joining us from fast company. you will be out there i think to see the fireworks.

>> yes. >> see the sparks fly. >> it's my turn to cover an apple event. i'm excited seeing what it's about. >> softness today in the stock price and that's one reason the comp is back to 4962, well off of the lows already. let's get back to headquarters, scott wapner and the half. >> thanks so much. welcome to the halftime show. meet our starting lineup for today. joe terranova is the senior managing director at virtus it investment partners. jon and pete najarian are co-founders of optionmonster and paul richards head of fx at ubs. so much going on related to the eurozone. we brought paul from connecticut to sit wiat the desk with us. bottom of the barrel, one investor bets big on crude's bounce. we debate whether energy stocks are the place to be. mcturn around. are the best days of the fast food giant still ahd?