good morning, it is 8:00 a.m. at linkedin headquarters at mountainview, cal ka, it's 11:00 a.m. here on wall street and "squawk alley" is live. ♪ ♪ ♪ ♪ ♪ good friday morning, joining

us this morning, dennis berman, business editor at "the wall street journal" at 30 rock. good morning, dennis. and kayla tausche here at post 9 with a lot to talk about with the dow trying to make up for lost ground. up to about 124 points on the first day of may. it's been a very rough week for social stocks as you probably know. here's a chart of linkedin, twitter and yelp down more than 20% on the week as they all reported earnings and it begs the question -- is social media overvalued? is it just that facebook is starting to dominate the competition? john that's a critical question that investors are wrestling with today. >> it is. it looks to me like this is as much as anything, the story of the rise of programmatic advertising. linkedin talked about it in the call last night. that while display advertising, traditional display was strong in 2014. in 2015 they've seen the surge in programmatic. what's that? it's more computer-based, market-based advertising. a combination of real-time

pricing and also computers making decisions, not just about long-tail remnant inventory in the advertising business, but about where to place ads in premium positions that used to command a bill big premium. this has affected yahoo. this has affected yelp. this is now affecting linkedin in one particular area of business. think there's a chance we could see some unicorns turn into horses over there. the way the businesses are valued, is based on engagement. if you don't have the data on who the users are, what they plan to buy. the sort of data that facebook has. the kind of data that google has, it will be harder for you to monetize in a programmatic dominated environment. >> it begs the question, because programmatic relies on the data, can this succeed? linkedin has talked about itself not only as a job-seeker site. but also as a content site and a

networking site. i'm wondering if you see these networks needing to define themselves as more niche platforms in order to succeed going forward. >> i think that linkedin is doing pretty well. 20% stock drop. you can't deny that. think that has more to do with the market getting ahead of itself in the valuation. if you look at what linkedin does, to john's point. i refute his unicorn-to-horse analogy. linkedin is building a true platform that does content that reaches recruiters and now doing online education with lynda.com. i think linkedin is in a better position than twitter. >> i wasn't talking about linkedin when i was talking about unicorns versus horses. they're already public. i'm talking about private companies that getting the big valuations based on users metrics and engager metrics, not

necessarily paying attention to the quality of data that they have and i agree with you, linkedin has a lot of other businesses, most of which do not rely on advertising and that's a strength for them. >> you made the point before, they get lumped into a group that they're not exclusively part of. twitter is a $38 stock, it was $50 a few days ago. what happens here? do they lower their rates? i mean is it still about the monetization unit? or is it, is it still about m.a.u. growth? >> i have some existential feelings about twitter. as someone who uses the service, i have to say it's getting better. lots of little tweaks here and there. it's more sophisticated, it's a little easier to use. but then again, most people don't want to spend a lot of time on twitter. at least new york media types do. from that perspective i think they've got problems. the most important problem -- who is the true customer of twit centre it's not us, it is the advertiser and the advertiser as you might read in the "wall street journal" today is not entirely happy with the direct

feedback mechanism and direct r.o.i. on the twitter ads, they have to improve that. they bought a company, they just announced it the other day, trying to do that. but i still think they have a ways to go. and if the advertiser relationship that matters most. >> the "journal" piece does give awe good sense of what ad buyers are thinking right now relative to facebook for sure. we mentioned linkedin a moment ago, shares down 20% this morning, possibly the worst day ever as a public company. eric sheridan is an analyst at ubs and joins us now. given what john just said about their business model versus their quote rivals unquote is this punishment unfair? >> well it's not unfair. because if you take a look simply at the cut in their forward profitability guidance, and ebita. it's around 20%. and the stock is down 20% from that perspective it's relatively fair. i think if you look out beyond this year, 80% of that cut is tied to things like fx and the integration of lynda.com, the

education asset they bought. those are unlikely to repeat in 2016. so the conversations we're having about investors is how much of the core business here is actually hurt or damaged going forward. we think there's some miscues from operation. but the core philosophy, the core what's going on at linkedin really isn't much changed on a going-forward basis. >> two issues that jumped out at me from the call. one was that rise programmatic advertising in europe that hurt sales. but the other was the salesforce realignment where they said they brought in all these new salespeople. the reason being to deepen a relationship with advertisers, 60% of advertisers had some change in who they were dealing with. and this caused some churn. it caused some difficulties in their ability to upsell. talked about it as temporary. but are you convinced that this is just new people coming in the door dealing with companies and they'll be able to reaccelerate that business?

>> two issues, one on the advertising side. the lead-in and were accurate in that it really does this riser programmatic, this shift to mobile. this shift to new ad units, we've seen it before in the industry. no doubt that linkedin is going through their growing pains in the line item they call market solutions. how do you monetize engagement on the site against content on the site? we think it's temporary and works its way through. the sales force reorganization actually had to do with the people who buy their talent product. that's more your hr people. that should allow, we should work that as we go through the year. they acknowledge a mistake -- >> why are you convinced? we see this sometimes with companies where they way it's a temporary issue. we think it's because we've got new people. they're going to figure it out like this. what if they don't? is there something in particular they said that convinced you it's temporary? >> we try to , don't try to rel on the company in these

situations, one of the topics you talked about earlier. was competition. there isn't a number two or three player you can talk to about lichkedin's vertical of hr or recruiting or retaining talent. the mode around this business is just as good as it was before. they overdid it they made too many changes and salespeople that touched their customers, they acknowledged that last night. they said april was better than what they saw in q 1. this is on them now on the execution front going forward. >> let's not forget another mode that they just crossed and that's the moat of china, just starting there, and that's in the plus column for linkedin as well. >> there are two big opportunities that linkedin haven't tapped, one is china and the other is small and medium-sized businesses. the vast majority of recruiters and hr professionals are in the fortune 100 for linkedin, we think there's a much bigger opportunity on s.a.e. going forward. >> thank you for joining us.

finally, tesla announcing it's launching a new line of batteries designed for homes, businesses and utilities under a new brand called tesla energy. here's elon musk at a news conference in california last had the night. >> the issue with existing batteries is that they suck, okay? they're really horrible. they look like that. they're expensive. >> elon musk, dennis berman, trending on twitter today. how important is this? >> hanging on his every word, man. i think he started an hour late. he thinks he's bono. it's pretty impressive as a showman what he's done out there. but i think there's, there's one thing that's real i had going on with tesla situation. they have to amortize the giga factory in the best they can. they'll put batteries in your socks if that lets them do that. this is really about spreading the costs out for that big factory they're building in

nevada. >> dennis, all you. >> secondly, i think there's going to be a lot of problems and a lot of financing issues, as these sorts of systems get into people's homes. they'll still be scandals, there will be issues. but long-term, this stuff does really get interesting. if you can put solar power in your home at a reasonable price and store it, that makes a difference. and it does call into question the very business model of the utilities that we've had for over 100 years in this country. it's a long-term question. but it's really fun to think about and i think over time, it's going to take some time. it will happen in some form. >> it is fun to think about, dennis, but this is a company and this is an executive that seems to be masters of diversion and we do have tesla earnings next week. i'm wondering is there any part of this that you think is a way to goose the pipeline before they go into earnings. >> short answer -- yes. we have seen some questions about the overall attractiveness

of the tesla automobiles. this is a longer-term project getting these batteries out there. tesla is a stock that sold on hope and glitz and it's done it quite well. and they have to keep that hope and glitz train running. i guess it is perhaps like a u2 tour a little bit. what is the cost of the giga factory and lou are we amortizing it? in a few years we'll have to answer that question. >> well the stock certainly reflecting some skepticism today as it sits in the red even after that conference. dennis, it's always good to see you, man. >> more led zeppelin that was a great intro. >> dennis berman of the "wall street journal." the dow is up by 121 points. the nasdaq is in the green as well. trying to avoid a fifth day in the red. that would be the first time that's happened in a couple of years. s&p 500 had been previously bon a psychologically important 2100 level. a couple points below that, but still in the green by about 12 points as we kick off carl the

first trading day of may. >> all right. when we come back, forget billion dollar valuations, our next guest company now worth $5 billion and counting, we'll tell you who it is. plus interest in the apple watch is tepid, according to ubs. and spotify set to announce a new round of funding this morning. kayla has details on that and the dow sup 115. on this friday. but what if you could see more of what you wanted to know? with fidelity's new active trader pro investing platform, the information that's important to you is all in one place, so finding more insight is easier. it's your idea powered by active trader pro. another way fidelity gives you a more powerful investing experience. call our specialists today to get up and running.

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we want to update you on a large round of spundsing that spotify just completed. sources tell me that the company had a first close for its current round of funding, roughly $350 million raised from a variety of investors. the valuation premoney, $8 billion. of course it comes at a time when spotify's business model has come under pressure from investors and artists alike. the investment makes it the 12th most highly valued investor-backed company. and pandora has a market cap of about $4 billion. a large portion of spotify's fundraising came from a vehicle operated by goldman sachs for institutional investors. i'm told more money could yet come in from parties and investor that are still considering an investment in the

company. but $350 million, on $8 billion free money. so about 384 post-money is where spotify's round of fundraising stands now. 60 million users, which means it's $135 value peruser. the company declined to comment on the news. certainly johns it seems like more money is chasing these fundraising rounds. especially at time when some of the business models are coming under fire. >> especially important in light of some of the results we've seen and the programmatic conversation we were just having. pandora has moved into more programmatic advertising, they talked about having more information about concerts people want to go to. it will be interesting to try to line up people's music tastes, how and when they're listening to things based on what they want to do and what they're doing. that's a ways off to be able to put together. so exactly what metrics and expectations are people are valuing spotify at that level. >> a great story, who is a steely dan consumer.

versus a hootie and the blowfish consumer. who do they like, where do they live, how much do they make? >> maybe you're able to get higher rates in this programmatic environment. >> some of the record labels who are investors in spotify would like them do get more premium users to up their paid subscribers, we'll see how spotify chooses to use this money, $350 million. speaking of multibillion-dollar valuations, our next guest company just raised $225 million in the latest round of fundraising, giving intarsia about $5.5 billion of funding, let's talk to their chairman and ceo. >> thanks for having me, i watch you guys all the time. >> before we get into what intarcia does, i wonder if you could comment on the state of the fundraising environment. you just went through this process. what is the sentiment from investors about where they're willing to put their money right now.

>> in biotech it's important to put money into places where they can fight diseases, we've raised over $1 billion, that's because we have something that doesn't exist in pharmaceuticals or biotech. we're developing a new category of medicines. that are aimed at treating chronic, major diseases like diabetes as our first one. with just once-a-year therapy, we'll have the first only once yoi year therapy for type ii diabetes if we continue to be successful. >> much of the coverage of the latest round of fundraising talks about the pump, the drug delivery pump that's implantable. that's where the bet is being made by your company. it's not going to go to market until 2017. i'm wondering if you could take us out over the next couple of years and how you take that to market. how much more capital you might need in the meantime? >> we're about two years away

from launch of the product. if all goes well with regulatory 30s and both the u.s. and in europe. we'll be filing globally in the early part of next year. it typically takes about a year for regulatory 30s to do the review and approve the medicine. so with the financing we just did, a couple days ago, we closed the first-ever synthetic royalty for a preapproved drug of this size. it was a $225 million financing. we exchanged 1.5% of our future sales of our first one once-a-year diabetes therapy. patented protected out through 2021 in the u.s. you feature of the deal is we built in a creative option to convert the royalty interest into equity and a 5.5 billion dollar valuation over the investors have the option within a period of two years from the time our product is approved, until two years after launch. so it's a pretty innovative

deal. but big picture, because we raised $200 million about a year ago, through an equity deal, and then we did a large billion-dollar-plus deal with an ex-u.s. company who will have european rights for our product, we're now financed as a company very well through the next three years. and we're still private. so if we want to, we can keep the company private, all the way through our first year of launch. and take the company public. >> well it's certainly an exciting time, kurt, we congratulate you 0 on the fundraising and we'll continue to watch where intarcia goes as you continue to bring this product to market. up next this might be the chart of the week -- twitter, yelp, linkedin all down more than 20% since monday. is social media getting overheated? kara swisher will weigh in on the debate when "squawk alley" returns. ♪ ♪ there's some facts about seaworld we'd like you to know. we don't collect killer whales from the wild. and haven't for 35 years. with the hightest standard of animal care in the world,

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almost 23% for the week. a bad week for social media stocks, along with the likes of twitter, yelp, facebook not doing nearly as badly. just about 3% for the week. is this about the bubble bursting or is facebook dominating all the kpet snigs joining us by phone, recode's co-executive editor, kara swisher. >> i think that facebook is a like a giant ocean liner plowing its ways through advertising and offering advertisers all kinds of platforms and videos. they had a very successful video offering and they're doing well with what's app and instagram. they've got a lot to offer and the client advertising isn't as large as it needs to be and there's a lot of players vying for those advertisers. there's still even though s piling in to online advertising, it's still experimental by a lot

of the big advertisers. so they're just vying for a pie that there's too many players going for. >> with the velocity of the rise in programmatic is catching some people by surprise. we knew it was out there, but linkedin indicating it's growing pretty quickly and affecting their business. what do you think the follow-on effects could be? if we're seeing the stocks that are seen as potential acquirers for the start-ups and unicorns coming down, might that affect the valuations for those? and also if people who are valuing the start-ups based on just the number of users and their engagement have to start thinking about in a prattic environment, how are they going to monetize? might that affect things out there? >> absolutely. pratt programmatic is cheaper, you make less money, it just creates a situation where i've always said a lot of these companies are going to get bought. a company like yelp, which is a perfect company, it's got a ton of great content. much better than almost anybody else in that local phase, can

they make it by themselves or do they need to be attached to a bigger ocean liner. wher you're competing, you've got to figure out who is going to have the product that is unusual and innovate i have been. now snapchat has tried this new discover thing which is pretty cool. there's all kinds of things going on. but the valuations are all based on growth. and that's the issue. they're all based on growth if there's not growth, or crazy growth, you have to ere-evaluate. >> we're looking at a chart which shows facebook down about 3.75% on the week. there's a question coming in from investors which is if facebook is the company getting it right, why isn't the investor selling linkedin, selling twitter, selling yelp and buying facebook? >> well if you're a fair investor, you turn any of these companies down. linkedin is the leading business

network. it's a really interesting acquisition to getted prescription price from lynda.com. that's one of the reasons they said the numbers are going to be off. you've got to bet all over the place. there's not going to be one winner. there's not one nbc, abc, cbs, all kinds of things. the question is who is going to create the innovative products that's going to attract advertisers to it? the company has been valued on growth and if their growth is slowing, everyone starts to look at other parts which includes revenues, advertising growth. twit certificate a perfect example. they had had great advertising growth and the other growth has been off. and now they have some weakness there. so that's what investors are concerned about. >> kara, if your argument is that a lot of these names are going to get bought and become a vertical on a larger ocean liner, how do we know who is goesing to doing the buying? is it desperation or cash on hand? >> twitter is a really a global network, very powerful property. the question is, is does it do

better when it's attached to a bigger player? it's still a fantastic product. yelp is still a fantastic product. i use it all the time. can they make a large-enough business investor interested in it by itself. that's perfectly possible. it's a question of, of where it can get its next growth and that's harder when you're smaller. that's, you know, that's the big issue. >> it's been quite a week, kara, always good to see you. and work with you now. recode's co-executive editor kara swisher. >> come back to san francisco. >> we will. talk to you later. >> thanks. we just talked about weakness in the social media space, that weakness is extending toen cans that recently went public and josh lipton is live in san francisco with a closer look at some of those repercussions. josh, over to you. >> well kayla, everyone talking about the big hit that social media stocks are taking. linkedin, twitter and yelp.

which you guys were just talking about. a number of high-flying stocks have suffered hard drops in 2015. go pro down 20%, as investors solded camera maker because of worried about valuation, lock-up, expiration, go pro is up 10% since the last earnings report. fin tech, a hot sector, if you look at lending club, it's down about 30% year to date. zendesk, which provides software that ought mates customer service has been a top performer since its ipo. but the different story this year, it's down about 6%. even box has failed to keep the momentum going, still up strong since the ipo, but down hard from its high. so what do vcs make of the move? well mendle ventures says it's good to see the mini corrections, many of the stocks he said carry nosebleed valuations and need it to come back to earth.

there will be knock-on consequences so a cooling in the market should mean a welcome cooling in the private markets as well. guys, back to you. >> josh lipton in san francisco. thank you. scott wopner has been breaking news regarding young and has more news on the stock. >> i don't know what it is with yum brands, butky tell you from my source it is has caught the eye of yet another big-time activist investor. learning from my sources that keith meister's corevex has taken a large position in yum brands as well. i reported earlier about dan loeb taking a significant stake. well keith meister has as well. i'm told it is a top five position. he is now one of yum's top five shareholders, according to my sources, he will discuss his detailed view of that company on monday at the ira sohn

conference. so that sort of amps that whole deal up. i'm told that mr. meister bought the yum stake in the early first quarter. the same time period it appears that mr. loeb, of did as well. so keith meister's corvex, now a top five shareholder in the company. he said i do believe there will be more details coming about this on monday from ira sohn, guys, back to you. >> yum close to the highs of the session, above 90 and already the best day since it was spun off from pepsi in '97, scott wopner, thanks so much. europe was largely closed today, a few markets open. >> of the major ones that trades, you've got dublin in there. margaret thatcher moved the public holiday not to celebrate labor day, so the uk trades are low. lloyd's bank is higher and some of the minors have come through

strongly as well. thank you very much. this weekend, marks the last weekend before the general election in the uk. which could be the most important actually since '79 when thatcher came to power this is scenes last night from a tv debate. cameron and ed miliband, the opposition leader. david cameron is saying there will be a referendum on the uk leaving the european union if they get back into power. and ed miliband this was a rough tv debate they had in yorkshire yesterday. ed miliband said that he -- you see the symbol. he said he wouldn't do a deal potentially with the scottish nationals on a coalition. that's bad news for potentially gaining power. and this stumble may live to haunt him as well as he left the stage. because it is mayday, today is the day in europe where the radicals take to the street. i want to take to you milan. where i understand we have live pictures, that's athens, do you want to go to milan and have a look at what's happening there? thank you. this is live pictures from the

streets of italy. today the pope just opened the italian expo, supposed to be on the theme of sustainable food production. but thousands of demonstrators have marched into the of milan saying no expo, eat the rich. the expo has faced corruption investigations, a lot of arrests, cost overruns, hold-ups that meant that large proportions of it were not open today. i have to say that his holiness the pope didn't help the atmosphere, when on the live link up at the beginning he said this certain ways the expo itself is part of this paradox of abundance, it 0 obeys the culture of waste and does not contribute to a model of equitable and sustainable development this is quite common on mayday that your radicals will take to the street. it is international labor day. can i take you back to athens as well? here the prime minister of greece actually joined the protesters in marching on parliament and that's what you see there. meantime, on the upside for the

markets, there is talk locally in the press that you might seek a euro group meeting on monday. so that it can basically sign off on the fact that they're making talks in private on those debt negotiations. and importantly, a senior member of the ecb said if there appears to be some sort of agreement at the staff level, they may raise their cap on t-bill issuance, which will mean that the greek government gets money to pay bills, not least the imf. ah, europe in may. back to you guys. >> simon hobbs, very interesting times over there, thanks for bringing us the latest. when we come back, could disney's avengers take in $2 billion at the box office this summer? it's already setting records, making $315 million so far. we will have more on a summer box office season that's about to kick off, when "squawk alley" returns. 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.

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breaking news in baltimore, an arrest warrant issue ford six officers involved in the death of dpredie gray, the state's attorney general has determined there's problem automobile cause to file criminal charges. the three baltimore police officers illegally arrested gray on april 12th and that the knife he had was not illegal. we'll have more on the story as it develops. nepal's government is reportedly providing $1,000 to the families of each of those

killed in last week's devastating earthquake. meanwhile the country's central bank ordered all private banks to open for at least a few hours today and over the weekend to meet the rising demand for cash. the death toll stands at over 6,000. and the department of justice announced a $20 million body camera pilot program for local law enforcement organizations, the grants are the first part of $75 million, three-year program that was requested by president obama in december. the department expects to provide 50 awards, which require a 50/50 cash match. they say the goal is to equip agencies throughout the country with the tools they need to tackle 21st century challenges. and new data shows more than 25% of americans spend at least half of their family income on rent and more than 1.8 million households spend at least 70% of their income on rent. officials define housing costs in excess of 30% of income, as burdensome. that's our cnbc news update at this hour.

markets hanging in close to section highs, dow is up 131. we're just a shade below 2100 on the s&p 500. about 21 points from the dow 18-k and 22 points from the nasdaq. it's the weekend, it's may and that means "avengers: age of ultron" is kicking off today. can disney's juggernaut break some all-time box office records, with us is the chairman of boxofficeguru.com. a few years we were worried about the era of the movie theater over. we've got "fast and furious 7,"

"star wars" coming up. focusing on the new avengers movie, does it have a chance? >> the numbers came out thursday night preshows, $27.6 million. that's not a record, however it could push the opening day, which includes the all of today, friday, to a new record high. possibly the high 90 millions, possibly even 100 million for opening day. that would be a new record and avengers number one holds the record for the all-time biggest opening weekend that might get obliterated this weekend by part two. >> what's going on with the popcorn flicks? why are they doing so well in this era where there's so many forms of entertainment, competing for people's attention? >> well people do love the biggest brands, a lot of the small and medium films are getting pushed out, can you see them at home, on your phone, on netflix. but the biggest brands, "avengers" "fast and furious" these are experiences that people want in the theater with, the sound and special effects, sometimes 3-d.

this set a record with imax last night. no imax film has ever opened that big on the night before opening. >> what happens to the "pitch perfect" and things that aren't a visceral experience, but obviously a big franchise. >> having 200, 300 together and laugh in a movie theater is also very popular. some of the big ol comedies can do well. "pitch perfect 2" is doing very well. it's female counterprogramming to the testosterone and "ted ii" "and "spy" with melissa mccarthy. >> technologically, where are we headed? 3-d didn't work at the scale that people expected. what's the next big innovation that could raise the price of tickets that people are willing to pay. that could draw people into theaters for other types of movies. >> studios exhibitors are hesitant on going too far with

anything that raises prices. a lot of consumers are seeing this backlash on prices. here in new york city, "age of ul tron" at the imax, $22 a ticket per person. people are pushing back on that. there are theaters that offer motion in the chair. paying extra for the premium experience. on the date crowd trying to impress somebody, that's where you're going to see the extra spending. but a lot of people are hesitant on the higher ticket price, only, only if it's really worth it. >> are we not seeing tv and movies compete? because with "game of thrones," orange is the new black, all of the content coming out in the summer season, is that not stopping people from going to the movie theaters? >> it's a factor that people have to worry about. last summer was not a record-breaker, down 14%, 15% from the previous summer. part of the reason was bad movies, but the other part is changing demographics, changing consumer behavior.

a lot of people under 25, under 20, not going to the movies so much. consumer does want the big brands and big celebrity experiences that get people out. that's a major issue studios have to worry about. not every film is worth paying $20 a ticket, especially if you're young and price sensitive. >> the $7 kitkats. my favorite. if you want to watch what's being called the fight of the century at a random bar, you might be out of luck. we'll explain in a moment. but first, rick santelli, what are you watching today? >> well of course i'm watching the ten-year note rates get closer to unchanged on the year and we're going to dig down a little bit on today's ism report. one category in particular -- should be important to you, which one? tune in after the break to find out. [ female announcer ] who are we?

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legalzoom has helped start over 1 million businesses, turning dreamers into business owners. and we're here to help start yours. we have a quick news alert. let's get back to sue herera, with details back at headquarters. >> david wildstein, the former port authority of new york and new jersey executive and a political appointee very loyal to chris christie, the governor of new jersey has pleaded guilty in the george washington lane closure bridge case. the judge has released him on a $100,000 bond. citing that his cooperation with prosecutors for those release terms, the wildstein sentence something now set for august

according to the judge. and that's what we know right now. still a developing story, john. i'll turn it back to you. but he has pled guilty. >> all right, thanks, sue, for that news. meanwhile floyd mayweather versus manny pacquiao being called the fight of century. you might have trouble if you want to watch it in a bar, at least in vegas, jane wells has more. >> they're expecting 200,000 people in vegas this weekend. but only 17,000 are going to fit in this arena. and mgm has a monopoly if you try to watch it on tv in town. you have to be at an mgm property to watch the fight on tv. there are still some tickets available for the closed-circuit parties, the cheapest i saw was $327 to fight the fight on tv. mayweather remains the favorite. guaranteed to make $220 million, he says more, but for the team it's not all about the money. >> it's about the legacy, it's a little bit about the money. about the fans, a little bit of

everything wrapped in one. >> i just hope they pick the right room. eye saying i can't tell you to do what the money, he's a grown man now. >> our focus isn't the money. the money will come, you know, this has been 19 years of hard work and dedication and it's about winning. >> well speaking of the money, tickets on the secondary market coming down, the average is still over $6,000 on stub hub, hedge fund chris garcia, bought a ticket for $8, when prices jumped to twice that he couldn't resell it until he physically took possession of it until yesterday. >> the market has gone down. today is thursday, i'm hoping by saturday there will be an uptick like we saw with the super bowl. earlier this year. so -- hopefully i can at least break even. >> if he can't sell his ticket at a profit, carl, he's going to

have to go to the fight. poor guy. back to you. >> jane you're lucky to be there, jane wells in las vegas. the dow is up 101, let's go to the cme for the santelli exchange. >> there's nothing more important on any given month than the employment report. remember the month we had 295,000? that's when we ended up getting our trades and yield back over 2% in 10s and a week from today, we'll have that report. but something in the ism report today caught my eye and of course, it was the employment index. and as you look at this chart, remember, today's number was 48.3. that is the lowest level for getting for a second that anything under 50 should be raising some flags. but it's the lowest level since september of 2009. march of '09 is when the lows in the equity markets reversed this is very important numbers to look at the chart. second topic, as i look up i see a 211 yield.

i do remember 224 the high yield for the day. it was in early march. the low yield for the year was 164. that was the last trading day of january. the average? 194. which is right now middle of the 29-session range. why am i regurgitating all of this again? because as a market, student of the markets and a former technician in another life, talking to traders, they're pretty much acclimated to the notion that there's a high propability test unchanged and why should that matter? well for one reason, it never occurred in all of 2014 and of course it's occurring at a time where we had a weak gdp. we could argue as to how week, key could compare it to last first quarter which is even weaker and of course we all can get led to the weather game. but, if you look at some of the data points that we had last april versus this april, you could definitely argue there's a softness now, that didn't present itself then when we had second and third quarters that were redeemed the year. to bring it back up to 2.4%,

which leaves me with the final argument. the final argument is normalization. now we have our ex-fed chief blogging and it's become somewhat entertaining. everybody likes to read. he is definitely defending policy against publications like the "journal." when people call for higher rates. vy now changed, it's not necessarily about higher rates, because the fed can definitely keep rates moving higher in a way that probably isn't sufficient, considering the level of activity in the economy versus crisis activity. normalization really is what everybody is debating about. because it's about price discovery. you know we have the short end pegged to the guidance of the fed, the long end held hostage by their balance sheet. with no true price discovery you get no true market signals, so it's impossible to make good policy. even if you look forward to new leaders in 2016 how will they make fiscal policy when we've no idea what's wrong or bad or good with the economy. what i look at whether it's

southern europe or our interest rates, means nothing historically. john, back to you. >> all right. thanks, rick. now let's go from macro to very much micro. as apple fulfills orders on the apple watch. cot demand for the watch be slowing? our next guest says interest is tepid. requiring appointments has reduced the buzz for the new product. steven melanovich is an analyst with ubs. so okay, didn't apple want to reduce the buzz and demand because they couldn't fulfill the orders and maybe the fact that you can't actually get delivery on this thing for several weeks is causing people to sit back? how do we know that things won't rocket back once apple has supply of the watch? >> well they might very well. and clearly supply is having some impact on demand. but our ubs evidence lab archle watch monitor is finding that the google search interest if you will, in the watch, is only about 20% as much as the original iphone and ipad.

and we also tracked it versus 30 other consumer electronic introductions over the last decade. it's also lagging those. not only is it lagging, but it's actually kind of deviated down in the last two weeks. so it's gotten weaker as we approach launch. now that could very well change once we get more supply in the market and we are still bullish on it longer-term. but this was sufficient for us to take down our next-year estimate from 40 to 31 million watches. >> steve, cramer made the point this morning on our air that you got to have it in the store, right? you got to be able to have a tactile experience with it before you shell out $350. $700, that's obviously happened later. maybe than they thought it would. how much of a difference does make? >> well it makes a big difference. it's a new product category. it's going to take some training, they want to get people into the stores, get appointments, show them how to use it. i think word of mouth is going to be very important. we've always thought that the first iteration of the watch is going to take time to be appreciated. ultimately we think the watch is used as your interface to the internet of things.

we very much believe that apple technology belongs on the wrist, it's likely to be successful. but it's going to take some time. >> steve, in the meantime, the silver lining was supposed to be that this is going to have really fat margins and be a very profitable product for apple. but they didn't necessarily sound that tone on monday on the earnings call. i mean they basically said this was going to be a lower margin product than the company average. so you think they're just managing expectations there? >> well they're specifically talking about the june quarter. my guess is that over time, this will have corporate, average or better margins. i think they were talking about the short-term. on the other hand, i think the iphone has some upside. you've had two killer quarters here. we believe that about a third of iphones are going to new users, first-time smartphone buyers or switchers and tim cook talked a lot about gaining share. it's very possible that that will continue to keep iphone numbers ahead of the street and buy time for the watch to begin to take off. >> steven, if we get delivery of new batch of apple watches, in

early, mid summertime and we've got wwdc and more news around the product at that time, does this right now tell us anything but that some analysts may have gotten a little ahead of them selves for excitement in the watch and we'll see in a couple of months where things go once we have supply? >> i think it will take some time. nobody really has a great sense of demand. perhaps including apple. we had an aggressive number, 40%. we're assuming 7% of the iphone base can get a watch that works with their phone will buy one in fiscal '16. down 10%. our survey suggests as much as 10% might buy it we're being a little more conservative now at 7%. the stock is run in a big way. i think it needs to consolidate a little bit here. we think it's headed to our price target of 150. is. >> a lot of people being a little more conservative about a lot of things, steven, thanks for joining us. >> milunovich nailed the capital

return forecast. steve bollmer going nuts at a an l.a. clippers game. ed a dow is settling off the session highs, we're off 100 points and back in a bit. why pause to take a pill? or stop to find a bathroom? cialis for daily use is approved to treat both erectile dysfunction and the urinary symptoms of bph, like needing to go frequently, day or night. tell your doctor about all your medical conditions and medicines, and ask if your heart is healthy enough for sex. do not take cialis if you take nitrates for chest pain, as it may cause an unsafe drop in blood pressure. do not drink alcohol in excess. side effects may include headache, upset stomach, delayed backache or muscle ache. to avoid long-term injury, get medical help right away for an erection lasting more than four hours. if you have any sudden decrease or loss in hearing or vision, or any symptoms of an allergic reaction, stop taking cialis and get medical help right away. ask your doctor about cialis for daily use and a free 3blet trial.

they are the natural borns enemy of the way things are. yes, ideas are scary, and messy and fragile. but under the proper care, they become something beautiful.

probably the video of the day, steve bolmer at the clippers game last night in vintage form. >> social media having some fun with this we knew he was going to be emotional. >> the man is a walking gif. >> that keeps on giffing. >> i said give as in g-i-f. but you could put a t on the end of it here is he. >> the fact that he paid $2 billion in the atlanta hawks just sold for about half of that. you wonder what's going through his mind. he's got to get into the playoffs. >> love the story about how it all came to him. how his son suggested it and almost an impulse purchase for a guy with a lot more money than $2 billion and the clippers fans knew what they were getting in advance and he's delivering on a lot of it best of luck to all

the nba teams. the nasdaq, 4980, are going to be interesting to watch. and next week, my gosh, whether it is disney, cbs, wendy's, whole foods, tesla. >> alibaba. >> jobs number on friday. have a great weekend, let's get to headquarters, wopner and the half. ♪ ♪ . welcome to the halftime show. john najarian is the co-founder of option monster. michael bloch is chief strategist at managing partners. jim lebenthal is press of lebenthal asset management and michael santelli is a senior management for yahoo finance the our game plan looks like this. social anxiety with yelp, twitter and linkedin getting ripped. while social media is in a