take it away, carl. >> good morning. 8:00 a.m. at apple headquarters in cupertino, 11:00 a.m. on wall street, "squawk alley" is live. ♪ ♪ ♪ now the time has come no place to run ♪ ♪ ♪ but i have my fun ♪ i've been put aside welcome to "squawk alley" for a wednesday. joining us this morning jon steinberg ceo of the daily mail north america. good morning to you. >> good to be here. >> jon fortt and kayla tausche at post nine. watching the markets well off the highs. the dow up almost triple digits but up about ten. big story in tech is the review of the apple watch out this morning and among them, c-net scott stein says the watch is beautiful, bold, but comes with

some complications. joining us this morning at post nine is the senior editor of c-net scott stein. that's an echo of what a lot of people are saying. what are the complications. >> you know, i want to make my life easier, right, and i think that's the idea of the watch to make you life easier. and there are fantastic shortcuts, ways they've reinvented notifications but a lot of ways to interact, apps and subapps and so many ways to interact, that it's going to be a little hard to figure out. i've used a lot of smart watches and tech, so i've given this a week and i find it's not always that seamless to get from one part to the other and i'm playing with this on my wrist a bit. >> we are men of action, right. lives do not become us. you were critical of this. under whelming for you, compared to a lot of the reviews. overall the reviews are positive for the first generation product. you find a lot to be skeptical of in this particular iteration. >> i think it's because there's

a lot i wanted to like and, you know, you're hoping they've nailed it and compared to a very middle landscape right now in smart watches they are getting a lot of things right, but battery life matters to me. now for some people maybe not as much, i hammered other smart watches and the battery life wasn't good and this gets to about a day. i have not cleared the night comfortably and i know other people mentioned they get about 30%, 20%, but a lot of times if i was using it it would hit 1% and go out. i thought i'm going to charge it. if i'm going to charge it next to my phone i can't use it for silent alarms which i love on some of the other smart watches to wake up, can't do sleep tracking, and if you're looking for -- if you're an emergency response person thinking i want to use this to stay more connected if i'm on call that's going to become an issue. it's getting over the hump and then i also think a little bit is the price and how much you can do away from your phone. >> what needs to change about the ecosystem? that was supposed to be the

differentiating factor between say the samsung gear and the apple watch was that we're already familiar with the apple ecosystem, so many people already use it, it's a compelling design, but you seem to find some issues with it? what needs to change? >> i think the apps underlying it and part of that is that the third-party apps, apple's apps run smoothly, but you have these three levels, notifications, these chance glances which are like widgets that you get on your iphone or other places, great little head's up pieces of information, that's great. the apps underneath the huge grid, they take time to load. right now they take more time than i would like. that could get better over time, maybe ways to get worked out. takes more than 10, 15 seconds, i got my phone right here. so, you know, it's got to be fast. >> on that point, i mean all the reviews, our daily mail review, say you don't look at your phone anymore which what is everybody wants. is that true, your read? >> i am not looking at it as much anymore but i'm going back to it because certain apps will

ask you to set things up on your phone, start this game on your phone, get the full stats on your phone, read the whole article on your phone. but my wife is the one that pointed it out, does she love it? she kept saying traded one jean for another. i am -- screen for another. if i'm playing with this more than ten seconds, there's still a little bit of hey, get back to the kids. >> shows us the chargers. >> the times review, it saved his marriage, his wife is thrilled he's no longer checking his phone as often. >> more forgiving. my wife wants me to take everything and leave it at the door. she's seen a lot of this stuff. she's a little more -- >> i'm reminded of the first steve jobs' iphone announcement, typing on glass, getting used to and then fly and awesome on it. do you feel like you'll get over the hump of figuring out how to use this? >> that's what i'm curious about. only one week to use this. a week is not enough. we will look at this over weeks and months. i'm going to be updating the review. it could change. i think there are streamlining, a lot of issues i had were again getting to the apps you uses the

most, that if you create other shortcuts or maybe i need to learn or techniques, that could help. but i think so. i think there are going to be ways to develop shortcuts to fly. >> this is from a viewer, when walking in the bright sun you have to adjust your phone to blast the brightness so you can see. is that an issue here? >> it's not bad. it's quiv loents to the phone. it doesn't wash out the screen completely. use it in the brightest sunli t sunlight. that was nice. >> like you said, still has a couple weeks. >> siri and passbook are good and that's something we hammered those. those are some of the best apps on the watch. >> scott stein of cnet thanks for coming by. >> thanks. >> a move for tesla, shares rallying after the company announced it's upgrading the base model, model s, better battery, bigger price tag, the new version will cost $75,000 instead of $71,000, able to drive 15% further than the previous model, about 240 miles.

tesla said friday it sold a record number of model ss in the first quarter. this is some argue real progress, the stock up 4% premarket. >> there seems to be a misunderstanding around that record friday announcement. the ibt had an article saying there was about 1400 units which were delayed from q4 that got put into q1. elon said that. given he's got to hit 55,000 units for the year and sold 10,000, it seems like a high mountain to climb. >> phil lebeau's report acknowledged maybe the reason tesla is doing this so its basic model s would be more competitive in a luxury market where other car companies are starting to blur the line between be traditional luxury and modern luxury. i wonder if you feel like tesla has some of these other car companies hot on its heels? >> the stifle note out basically said that they are not demand constrained. they're supply constrained. the buyers of teslas want to buy more. they want insane mode, want more add-on. these are affluent buyers. that would play into the fact they are doings the right thing

with more battery life at a higher price. >> it's about the bat it terry technology for them at this point, right? it's about the gigafactor, whether they can stand that up, get the price of future versions of their cars down into that 50,000 and below level. it's a popular car. it kind of has the top brand in electric cars right now. so these announcements to me, like if i were an investor i don't know how much i would care about it unless it's really bad news. >> well, i mean, if they're going to be lowering their average price point, this is a move in the wrong direction. the improvements will cost money in this case 4,000 in incremental dollars. >> for the crowd buying teslas right now this is great because the all-wheel drive has been popular, steve kesh in silicon valley was getting rid of his older model s because he wanted the all-wheel drive and advertising that on facebook. they have a loyal base. the future what investors are betting on is a whole different stage of this company and this

doesn't really play into that. >> the price is not the issue at this point. can he actually produce the units that he needs to hit these numbers because it's still 55,000, isn't really even that many. the numbers that they want to hit is 5.7 billion in revenue, 8.8 billion next year. stifle puts a $400 price target on it which would be 60 times 2017 earnings. unbelievably expensive stock despite the growth. >> yes. speaking of which, the rumor just will not quit. additional pick-up in various news outlets, rumors the social media company twitter could be a takeover target. reports mention google as one of the two companies that might approach -- have approached twitter with serious it interest. the reports say that twitter's hired goldman sachs as an adviser to spurn the advances. we have reached out to all three companies and only goldman responded with no comment. but this is "usa today" getting it on the record today. one of their questions is, is twolgle as a hash tag a real possibility. >> cramer said they wouldn't do

this for regulatory reasons. maybe that's the case. this is a company that has pretty much understood they need to build versus buy and they've done really well with organic growth even throw on the social side they haven't been able to have as much success. i would argue a different point which is that google is a very smart acquisition machine. if they were going to acquire twitter they could have done it cheaper. stock up 47% this year. they could have approached twitter at the lows. the company probably would not have sold at that price but they could have gotten a better deal. now it's arguing it's pretty expensive at this level. >> regulatory approval, absolutely. google stepped back from groupon the rumors were because they didn't think they could get that through approval. at a $34 billion market cap for twitter, a $370 billion market cap for google and a stock deal, it would be 10, 20% depending on what you think the premium will be, google hasn't done stuff like that unlike facebook. they will have $100 billion in cash by 2016 according to the

"wall street journal" they could do it in cash, but i don't see it. the government would never alu it. google under so much scrutiny. >> 52 bucks, weird timing for the rumor to be out there. >> given the anti-trust investigations overseas. cramer's point this morning was that it would be highly doubtful for them to do this and have regulators not say, enough. >> right. what's interesting is, facebook is the one who threw down the $19 billion for whatsapp. it would be too expensive for them as well too. no way the government would allow this. the government is all over google for privacy, all over google for potential an be ty trust things already. they will let them buy one of the major three or four companies in the internet now. >> is it one of the major three or four companies? >> absolutely we talk about twitter a lot and all that but when you look at monthly active users and sure, they're an incredibly important short form communication channel, but i don't entirely see the anti-trust angle. it's not like they've cornered the market on anything in particular. >> well look, i think that we are in a very political time when it comes to these issues

when you look at net neutrality as well. see a congress person standing up there saying, and now google is going to be with one of the, you know, the three leading companies. jon, to your point maybe the numbers aren't there on a factual level but from kind of a level, they are. >> okay. >> right there. what you just said. thanks, good to see you. >> yeah. >> let's get a check on the markets right now. we had given up some steam in the positive it territory after, of course, that inventory report showed a larger build than expected in crude oil. you saw crude come down as well but the event in the markets will be the release of the march fed minutes happening at 2:00 p.m. the dow hanging on to positive territory, though, up by about 30 points. s&p up by 4. nasdaq up by 27 points. lulu lemon in the green after getting upgraded to buy. the firm says investments in new systems and processes will pay off sooner than expected. lieu lieu up nearly 4%.

to buy at citi. they point to a compelling valuation and increased opportunity for acquisition deals. potentially as the reason for the upgrade. that stock up by just about.75%. >> when we come back scott stein of cnet on the apple watch. what does re/code make of it? they will join us for their official review. what does it take to get a job at google? the head of people's operations will tell us the number one thing he looks for. and our tumblr days at the company over? details on the big changes that marissa mayer has in store when "squawk alley" continues in a moment. financial noise financial noise

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all right. just what is the trick to getting hired at google? how will silicon valley handle its diversity problem and can companies use data and science to keep their employees happy. joining us at post nine is the vice president for people operations otherwise known as hr, lazcle lo, author of "work rules insights from google that will transform how you live and lead." >> thank you for having me. >> so many practices you preach in the book run counter to what we're used to. managing employees by committee, not trying to turn over your worst employees. where does that come from? >> it comes from actually failing to trust our gut. you know, all our instincts about how to manage people end up with companies that perform at average levels because on average we make average quality decisions.

play data and science to see what makes people effective and end up running things quite differently. >> a big part of the conversation about work in silicon valley and where we head from here is diversity, what to do about the talent pipeline. i have a bunch of friends still in education and tech in silicon valley who say google is actually working on potentially creating a school for kids. would the purpose of that be like a nexus product to create a blueprint? have you decided whether to do that or not. >> i don't think we're ready to launch a school but we created a program called cs first and partnered with bill de blasio in new york city. it's cs computer science curriculum in a box to use to form clubs, targeted 4 through 12 graders and we hope to put 100,000 kids through it. >> diversity generally when you think about building a company and diverse work force you need to balance the fact that a company is a meritocracy, the best should get the jobs. how do you balance those two issues. >> the trick you can never

compromise. i had a conversation with dr. lomax who runs the united knee grow college fund and you can't compromise on quality. we have to attract more. african-americans don't apply to tech companies as much as banking and finance and make sure it's a welcoming environment for everyone. >> 2 million applications a year. how many will you hire? >> we'll hire about 5,000. >> 5,000. >> out of 2 million. >> yeah. >> walk us through what the process is like? the interview process. how is it really different from a goldman sachs or any other challenging place to get hired at? >> the first thing that happens is a phone screen. what we mainly assess is general cognitive ability. how good you are at solving problems, how bright you are, quickly you pick things up. not case interviews. trying to understand how you think. a which we do that i cover. come on campus and you have four interviews, sometimes five. and then everybody writes interview feedback. that goes to a hiring committee. nobody you met is on the hiring committee because we want people unbiased people who set a high

quality bar to make the decision. that eventually goes to review to larry paige our ceo who makes the final call. >> is that a good use of his time? we've heard of this at other tech companies marissa mayer has to approve every hire. some say that's inefficient. >> we've gotten better at figuring out what works for larry and looking for and documenting that. it doesn't take as much time as it used to. >> people want to know what the most challenging google brain teaser is. hear about how many golf balls fit inside a 747 what's the whackiest one you've heard of in an interview. >> we're trying to get people to stop using brain teasers. it's a specific skill like solving these kinds of cases in brain teasers that doesn't predict how you will do on the job. we tell people don't ask those questions and when they do and we get the interview feedback in the hiring committees we typically ignore that. >> the rules are changing? ten years ago all the talk of the brain teasers and things you would do that supposedly evaluated how smart a person was and you would only take people from certain schools have those rules changed? >> yeah. completely. we are getting it wrong.

we were doing it the wrong way. the better way to ask structured behavioral interview questions. give me an example of a tough problem you solved and walk that through. different interviewers ask similar questions so you get more than one answer and get a calibrated sense is the person bright, solve problems, can they figure out why are man hole covers wrong. >> all the practices in the book can they be applied anywhere or something specific to google. >> the only thing that can't apply everywhere is three shuttles and cafes. that costs money. everything else works. if you look at companies like wegman's a grocery chain they do a ton of this stuff. a company in sri lanka a factory, they do a lot of very, very similar things. this works in a lot of places. >> again, thank you. lazlo, very good stuff. head of people operations at google. the book "work rules" available now. >> thank you for having me. >> let's get a check on oil. jackie deangelis is live at the nymex with more on an intraday slide. >> good morning to you.

that's right. after we got that department of energy inventory report a build of more than 10 million barrels of crude we are seeing the slide intense iffy. the selling pressure in the pits. traders telling me this is not what they were looking for. they were looking for a smaller build. starting to see signs that these rig count reductions and cap x reductions are hitting the marketplace. doesn't appear to be the marketplace. take this into account, saudi arabia has record production that was reported for march, 10.3 million barrels a day, a bit of a supply glut situation that continues. so watch this trade very closely. back to you. >> thanks so much, jackie deangelis, from the nymex. when we come back, yahoo! could be in for a major shakeup when it's all about social media. we'll explain how in just a moment. ♪

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in case you missed it yahoo! reportedly planning a major reorganization that could end tumblr's run as a standalone unit. the information reporting ceo

marissa mayer has spoken to david carp, tumblr's founder about the move reportedly asking him which executive at yahoo! he would prefer to report to. also says tumblr will not meet myers' previously estimated revenue goal, $100 million, this year for tumblr. we spoke to meyer about the future of tumblr after its acquisition in 2013 and here's what she said. >> we wanted to reassure people sort of the headline we wanted to make it clear we're going to operate tumblr independently, it's not going to change. there are going to be some things behinds the scenes be it search or discovery or pulling some of tumblr's content into yahoo!'s core properties but in terms of the way core tumblr works it's going to be in line with david's vision and road map and operate independently. >> jon fortt, some two years later is this going to be seen as a 180-degree shift or how do you look at this? >> i don't think so. i think these things always move

closer into the mothership as time goes on or at least almost always and there probably is no more important strategic thing for yahoo! to figure out than what to do with tumblr. they've used it in other magazine-type properties, tried to sort of spread its social media aspects throughout yahoo! but it's got incredible reach, but other properties like medium are encroaching on that. they have to figure out how to not only monetize it but reaccelerate growth. >> might be a hard selling point if they try to do another acquisition of another start-up? no? >> they haven't screwed up it it tumblr which is important. you have to give yahoo! credit there. they've managed to use it in ways that are good for yahoo! they started communicating about the mobile revenue they have been able to generate, tumblr has helped there. they need to take it to another level, though, and i think a big part of marissa mayer' next stage how does she manage that, which senior vice president is in charge of helping david carp to reize that vision.

>> shares up 3% today on news of the reorganization. we will see how that pans out. meanwhile bring in simon hobbs as we count down the close in the uk in about five minutes time. >> yeah. we hit a record. we came above a previous record close here in europe today because of the power and the weight you have within the big oil majors if you like. we've fallen back during the course of the session. the big news clearly is the royal dutch shell is putting through this deal at a 52% premium over the last nine months to take over bg within the uk. bg, obviously, had surged royal dutch shell is down 5% so a heavyweight there falling into negative territory. inevitably a lot of the smaller oil and gas plays around europe and other oil mainers have risen in response as people say who might be next if there's to be further consolidation. this is a name that keeps coming up and come up in the program before. meanwhile, later breaking news within the european session, electrolux, remember it's paying $3.3 billion to take over ge's

appliance unit. it's swedish. it wants to expand in north america. it is expanding in north america but warned its first quarter here is now going to be negative. it it's a negative result. partly it would appear more about the product redesigns they're moving from a different range of fridges and freezers and trouble with their cooking plant in memphis which they were ramping up. they have a huge number of brands. check it out on-line if you don't know it. that stock has been falling towards the end of the session. in moscow the greek prime minister met with vladimir putin. nothing concrete seems to have come out of that. they will renew their relations, reinvigorate their relations. this is a path that greeks would see. more importantly as it stands the greeks rolled over the t-bills today. tomorrow, of course, they have that big payment to the imf, 450 million euros. a lot of chatter about what happens as they face that choice between either paying pensions

and wages or paying their external creditors. actually christine la guard tomorrow importantly has given sara eisen an interview at this time of day where we may get more color. people are talking about is there a gray area where greece could have capital controls and still stay within the eurozone or they could force a new coalition on the greeks. a moving situation potentially still quite dangerous. back to you. >> thank you, simon. when we come back smart watches still unproven but apple has made a strong case for them from re/code's official review of the apple watch. do they think you should buy one? the answer coming up next on "squawk alley." woman: it's been a journey to get where i am. and i didn't get here alone. there were people who listened along the way. people who gave me options. kept me on track. and through it all, my retirement

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i'm courtney reagan. your news update at this hour. somalis living in kenya marched through nairobi condending all shabab and its attack on a kenyan university last week. 148 were killed along with four gunmen. a manhunt is under way for the others involved. spanish police arrested ten in the northeast eastern region of catalonia of an anti-jihadist

operation. around 30 people have been arrested in spain for suspected militant activity. aig says the faa has proved its request to operate small unmanned aerial vehicles for commercial use. the insurance company says the drones can accelerate surveys of disaster areas for faster claims hand handling. blue bell is expanding recall of products made in an oklahoma production facility because of a listeria contamination. the company says it's recalling pints of banana pudding ice cream after a sample tested positive. that's our cnbc news update for this hour. let's get back to "squawk alley"p. >> dos this now? thanks courtney. the apple watch reviews, are continuing to roll out this morning. and re/code's lauren good saying smart watches are unproven but apple has made a pretty strong case for them. joining us from one market is

re/code managing editor of reviews, lauren good. lauren, hopefully you can help put this in more context for us. i remember the first generation iphone, didn't even work on 3g networks at a time when 3g phones were becoming popular. didn't run third-party apps. for a first generation product, how is this watch? >> well, you bring up a really great point about the apps as my colleague bonnie chop points out in her review on re/code there aren't a ton of third party apps available yet. apple is promising there will be more when the watch begins to ship. the experience is limited. all of that aside, we've both been using the apple watch for the past week and overall we've had some pretty positive experiences with it. smart watches, of course, are not a new thing but they've generally been seen as a niche device or something for ultratechies and this is something that brings it a little more to the main stream. >> can you live without it? >> well, i'll be finding that out soon enough when i send

backs the loner. right now i would say i could live without it. it was kind of amazing to see how quickly it became that thing that i reached for as soon as i woke up in the morning. as i say in my review the second thing that i reached for. i reached for my phone first and said where's the watch. you do sort of quickly get used to this idea of notifications, looking at your wrists saying i have a new imessage or saying i have yet another like on facebook. really critical stuff here. so you get used to it quickly. i think you can live without it right now but it's the kind of thing that as you start to use it you really see its as an extension of your smartphone. >> lauren, we talk about the functionality of the watch for while you're sitting down or while you're standing at a cocktail party and don't want to take out your phone. what about while you're driving or walking easy enough you could get one of the taps or signals to tell you you need to turn, you know, at an intersection or is it something that's going to be a distraction and potentially dangerous while doing other activities that aren't stationary. >> that is an excellent

question. i did use apple watch using apple maps on it. of course it has to be paired with the iphone because the iphone is what's powering the maps. but i didn't find it to be too distracting while i was driving. it uses sort of the engine. i got another notification, sort of gently vibrated on my wrist so as i was driving it would vibrate and look down and turn right and that sort of things. i found that to be even less distracting than trying to fumble for my iphone on a mount and that sort of thing. i think there are going to be othercations where it was distrasting. i was in a business meeting and it kept pinging and the person i was meeting with said it was distrablgtsing. there will be different use cases and experiences based on your settings and how you're using it. >> we have merger news. forgive us. we have milan proposing to buy perigo. meg is at hq. >> that's right. hitting the wires, mylan

proposing to acquire perrigo for $205 a share, cash and mylan stock, mylan is saying represents a greater than 25% premium to perrigo's trading price as of the close of business on friday april 3rd. now again this is a proposal and mylan is saying in this release now that it's a culmination of a number of prior discussions. the two companies have had. now these are both companies that sell generic and over the counter products and this would combine two big companies making a bigger one here. this is just a proposal, $205 a share, mylan proposing to buy perrigo. back to you. >> apparently in the letter they've had discussions over the past few years which they note in the letter. we did see trading ahead of the news before halted. not often we get a $30 billion proposal in the middle of the market day. thank you very much for that. lauren, back to you. i guess separate from the

review, what kind of expectations do you have in terms of apple watch sales as it heads towards opening weekend? >> it's really difficult to say how well this is going to do. i will say that for -- it works for a certain consumer. someone who has an iphone 5 or later, tied to apple software like messages, itunes and that sort of thing, and if you're someone who likes to try new things and don't mind this is the first generation of a product getting sorted out it's something that might appeal to you. there will be a certain contingent that will buy it no matter what because they like the brand, whatever you want to call them, but this category of smart watches still relatively nay sant so i think we'll have to wait and see how this actually does. >> what kind of reaction did you get to the watch from people who saw it on you compared to other watches you've worn? >> people definitely noticed this watch. i was on a flight and one man said is that an apple watch. one waited outside of a rest room for me to emerge and ask me

if that was the watch. i said in my column on re/code a lot had to do with the fact there was so much hype around the product, it does have a nice design aesthetic, very pretty but people were more intrigued is that the apple watch. >> all right. so were you disappointed? was it what you expected? did it exceed your expectations? >> it was about what i expected. i think if you've been waiting for the launch of the apple watch this is not totally anti-cli mack tick. like i said it's a certain type of consumer and it's got to be an iphones user who's going to want this watch. >> lauren good from re/code. not totally anti-cli mack tick. we'll take that as you said it. thanks so much for joining us. hackers taking aim at the white house. we'll take a look at who is behind the attack. but first, rick santelli, what are you watching today? >> well, of course, i think we have to continue to monitor the yield curve. with the fed minutes we will

talk about how much does the fed know? remember, mr. dudley talked about how we're not as bubblish shus as we were before the crisis but looking through the mirror, behind us, what about what's ahead? we'll talk about that ahead after the break. ♪ approaching medicare eligibility? you may think you can put off checking out your medicare options until you're sixty-five, but now is a good time to get the ball rolling.

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plus, an exclusive with goldman's head of commodities research, jeff currie. who will come out on top when it comes to twitter's periscope? walter of btig tells us who the winners and losers may be. we'll see you top of the hour with more on this big day in energy. >> yes. now a big pharma deal, scott. see you in a few moments. we told you at the top of the hour tesla announcing major update to its model s car. phil lebeau is live in chicago with details. good morning once again, if phil. >> hey, carl. this is for the base model of the model s. it's no longer going to have a 60 kilowatt battery. what will the new entry level version have? they're calling it the 70 d. a new battery pack, 70 kilowatt hour that provides greater range and also greater horsepower. horsepower over 500. all-wheel drive not rear wheel drive and start 5,000 more than the previous entry level model at 75,000. what's the reaction on wall

street? jamie al berteen at stifle said we believe tesla is a supply constrained and not one demand cup strained and would view these product developments as support of that position. they're seeing greater demand for all-wheel drive as well as advanced technology therefore they are going to be upgrading the entry level model. what about sales year to date. we get this question from people. how does the model s do relative to its competitors or most well-known competitors here in the u.s. year to date according to auto data, volt, you see the sales there, lack luster, the nissan leaf, leading the pack with sales of more than 4,000, and this is an estimate from auto data based on their analysis, about 3500 of the model s sold here in the u.s., keep in mind, their first quarter deliveries worldwide tops 10,000. so as you take a look at the shares of tesla which have gotten a nice pop over the last couple days, in part because they released first quarter deliveries which were greater than expected and today, this

announcement regarding the entry level model s, keep this in mind, carl, this new model, does not have the insane mode. perhaps the number one question i've received from people is, you've got all-wheel drive, will it have insane mode like the p85d. nope. you're still going to have to pay more if you want that feature in your tesla model s. >> insane mode will always make me laugh forever, just the two words together. phil, we'll see you later. phil lebeau covering tesla today. let's get to the cme group in chicago with the dow up 43. hey, rick. >> hi, carl. indeed, today we had rebecca corbin on and the theme there, of course, is getting ready for earnings season, alcoa up the first this afternoon. much of her survey had lots of information that moved in a lot of different directions but one area that didn't move in a different direction that is, of course, when her respondents, investors globally, see the first fed tightening.

whether st. loueves liesman or rebecca corbin's survey, everybody is focusing on the same period, september, fall of this year. why? because the fed's pretty much driven us to that location. but here's the thing. i am sure that the fed wants everything to work out well. we all want everything to work out well. we'll learn in the minutes how much debate was going on behind the scenes, exactly as to how the weels wheels on the goal post will be used in the future and if the tightening/end of accommodation to the current level is going to change in the here and now. the important part to realize is, if you listen to fed officials speak, they talk about things a lot in the similar fashion that most of the traders on this floor talk about it. when you're talking about rearview mirror every trader on this floor would be a multibillionaire. every time i bump into somebody and we look at some of the charts of the past, i hear things like, that was easy, here's what happened, wow, i should have done this. so obvious. whether it's that we're not as bubbly as we were before the

last crisis, no matter what it is, looking at these factual interpretations, based on history, looking back, is easy. living through it moving forward, is tough. and if there's one thing i learned today about looking at earnings ahead, it's that the equity markets are important to the fed. if they have a hissy fit that will be dent mental to the tightening cycle pay less attention to the markets and more to the fundamentals of the economy and the big picture. about the yield curve. how many times have we talked about at great length the october flash crash and fixed income market. the most important level at that period in time in my opinion were the low yields. we had 1.86, close 28 basis points higher. the point is, where are they at now, 1.34. 1.86 a wash. about where you expect that part of the curve will remain. look what happened to the 30 year. 2.54 where it is right now.

2.67 where it was then and the low of the year for all of these markets and black was the 30th. i guess what i'm saying to keep it simple look for more curve steepening most likely that you're going to see this yield move back down into the teens and you're going to see this yield remain higher because this is the bargain if you want to be a buyer and get any type of yield. jon fortt, all yours, sir. >> i'll take it from there, rick santelli. appreciate it, sir. up next more on the proposed $30 billion merger in the pharma space. we'll get analysis up next. .

you're looking at shares of perrigo and mylan moments ago we got news from mylan, a press release, it had proposed a combination with perrigo in the range of $205 a share. we'll have more on that proposed deal in just a moment. meanwhile, today's consumer used to instant access to everything from goods to services, and our next guest wants to eliminate that pesky 2 to 5 day wait for money transfers. mobile payment company is announcing today that customers of bbva compass will be able to send funds through their digital payments platform ben mellon the c ceo, and joins us now. >> this is the holy grail for a payments company to be able to not only send money but have it available in your account immediately. what lets you be able to provide

this? >> dwolla is fortunate we built our own rails built to operate with existing financial institutions to move real money from point a to point b exceptionally quick. >> the reason this hasn't been possible on other platforms is because of fraud. when you do a mobile check deposit, from another bank, say it still takes a couple days because the bank, as always, has to verify that those funds are actually in that person's account. how do you protect against fraud and what is it about the rails as you describe it that keeps you from having to worry about that some. >> we developed an application that authorizes or allows a consumer or business to do a secure authorization, tokenizing the bank information at the bank level which is new. after that we're analyzing network wide in real time monitoring risk and doing individualized scores, to be able to allow our analyst to decide what to do with bad behavior. >> any expected rate of fraud? >> i think we'll see a lot of attempts for sure but we've got

staff at our company and also at the bank that's actually there to analyze, detect and react to fraud attempts. >> there's been all this effort to do money transfers, to do transactions, with as little overhead as possible. where's the margin going to come from longer term in your business? where's the value that you're going to provide that people will pay extra for? >> think about the cost to market infrastructures for or the absorbed costs because of the delays in payments. each hop takes 24 hours. what happens when five days becomes five seconds. new value created and changes the way people are going to exchange value and what exactly that is, we don't know yet, but the first part of that is launching the technology and seeing what happens. >> why bbva when there are a handful of other larger institutions that would love to have access to this? >> bbva has a great global footprint and a great digital first mentality. they invested money in a purely digital core system and

developed and codeveloped the secure authorization platform with dwolla. >> you've had a busy last few months. february i believe it was, treasury announced dwol la and paypal the platforms which they do 400 million transactions in i think it was over $3 trillion last year. what exactly is that partnership and what sort of spike in activity have you seen? >> that partnership is still new but i think it's a good point for the company and the technology and also it speaks to the government has the same problem that businesses big and small have. the speed and cost of payments affects everybody and the more volume you do the higher your costs are. >> what slayer of that $3.7 trillion in fiscal revenue the treasury has access to will dwol la actually get, though? >> unfortunately since still new it's small and growing and we'll continue to build that business over time. >> a lot of people in the payment space are watching this

announcement. >> ben mellon, ceo of dwolla. >> shares of mylan and perrigo both on the rise after mylan announces just a few moments ago it has proposed to acquire perrigo for $205 a share. it's a deal worth almost $30 billion. after the energy m&a we saw this morning today's turning into what appears to be $100 billion m&a day. barbara is an analyst at clairmont partners and joins us on the news line. always good to talk to you. good morning. >> good morning, carl. how are you? >> i'm good. we got celgene, teva, everybody is on a tear. are we bringing on the hostiles? >> i really don't think this is a hostile deal that we've been talking about and i think as i think everyone knows this has been speculated about a long time and pretty lengthy dialogs over the course of time about this combination. it does bring together two companies in the specialty

pharma market creating, you know, a global leader in the industry and i think, you know, sort of is exemplary of what we've been seeing in the specialty markets. all of the specialty pharma has been consolidating for a long, long period of time and most recently we saw the enormous deal with allergen with the other companies it had acquired and others prior to that. you know, certainly at a 25 plus percent premium for perrigo, the market wasn't completely pricing this in. that is a massive premium. $30 billion acquisition for mylan, mylan's largest ever, but i think as we see in specialty, these companies are broadening out in terms of the breadth of their product offering with specialty brands, generics, over the counters and in this case combination uniquely nutriti nutritional, as well as geographically expanding. >> what do you make of the fact that perrigo is trading above

$206 a share? i mean does that mean that traders expect that mylan will have to pay more and then meanwhile, mylan is up too? >> well, i think, you know, it's very interesting and we saw this with octave vis and allergan. both went up. when there's this big a premium and purchase price at play, the acquirer stock will go down. they're both up for the following reasons. i think that mylan is up because this is clearly going to be a creative deal to accelerate their growth and improve their earnings and prospects to expand geographically and create a broader platform for even more acquisitions. and people are looking for growth in the specialty pharma sector. and then additionally, perrigo has been an enormously successful company, a company that inverted by buying elon, mylan also recently inverted and it's an attractive acquisition target if you will.

mylan may have to pay more or somebody else could come out of the woodworks and make another bid for perrigo. that's what the market is saying. >> you say it's not hostile but yet mylan decided to go public with its offer after noting that the companies held talks, despite the way the letter ors press release is worded, would seem those talks have fallen apart and mylan has chosen to go public and put pressure on perrigo from the market perspective. what do you make of that? >> i think you're absolutely right. i think you put it properly. putting pressure, so i think that these things tend to be a dance and maybe there were others around and certainly i think that, you know, this is just provoking an outcome. i think hostile is a word that is a little strong for what i perceive to be happening here. >> barbara, you mentioned

mylan's quistiveness their biggest ever at $30 billion, second multibillion dollar acquisition after abbott. how much more is in the tank? >> well, i think, you know, that this combination would create a new company that would have the opportunity, obviously, to do substantially more deals. i think one of the things that mylan is focused on is obviously its geographic footprint, diversifying its portfolio, but also, like ac ta vis, being an r&d company that brings innovative branded products to the market. >> as we survey the landscape i mention the names higher after news of this deal just broke, how do we know who are the buyers and who are the sellers in the space? >> well, that's a great question. i think anything is possible. i think, you know, nine months ago, no one would have imagined that ac ta vis after gobbling up all the companies it had would

acquire allergen and the day it did that both stocks would rage ahead. what we see here globally in specialty pharma, but also in biopharma is a consolidating industry. and it's an industry that is being rewarded for growth, it's an industry that is being forced to be much more efficient around the world, as we have a consolidation of the payer base and most recently here with the aca in the united states, and this is forcing companies to really be leaders in their field which give them domain expertise and also allow them to have the highest margins possible in order to maintain their competitiveness and still have money to invest in r&d. and we see that with the tax inversion, right? people are -- >> absolutely. good, thanks for the incite. >> thanks so much. >> joining us on the phone from clairmont. before we toss to the half and the judge we have a special occasion here on "squawk alley." today is our own kayla tausche's last day before she gets

married. you can take a shot of her. we have a special surprise, a guest at the nyse to celebrate. her fiancee, jeff. congratulations. >> thank you very much. appreciate it. >> good to see you. >> you're not at work today? >> just for right now. >> interesting. well thank you, guys. >> have a great time. >> for all of your support. >> we'll be thinking of you and you will be missed. that does it for us on "squawk alley." headquarters and wapner and the half. >> all right. thanks so much. welcome to the halftime show. meet our starting lineup for today. joe terranova is the senior managing director at virtus investment partners. pete najarian co-founder of optionmonster, gordon is with us today, of rosenblat securities and on the floor of the new york stock exchange as he is every day. our game plan today looks like this. biting apple, why one wall street firm did what lately has been