hp kwaerheadquarters and 1:00 a here at cnbc headquarters on wall street and "squawk alley" is live. ♪ ♪ ♪ good friday morning, carl quintanilla is off today, joining me is roger lee partner at battery ventures and simon hobbs is here for the hour and with us as always is jon fortt. guys, good friday to all of you. let's kick it off with hp. shares are sharply higher today, after profit topped analysts' estimates. the company also saying it expects lower expenses when its

pc and enterprise business is split into separate companies. that's not saying it's going to be cheap. earlier this morning. our david faber asked ceo meg whitman whether she regrets splitting the can and if she thinks other ceos should follow suit. here's her response. >> i say this is totally the right thing to do. you cannot believe, i can already feel the difference in the companies in terms of accountability, focus, cost, more focus on cost. you know, less of that insatiable desire to hire. it is really, you could almost see it change in the culture before your very eyes in a really positive way. so i'm excited about it. >> she's excited, roger, but it's time consuming, it's expensive. the $1.8 billion restructuring charge did spook investors a little bit. what's your take on the progress? >> sorry, i think it's a very logical thing for them to do. i think it makes sense. people you know, forget how big

hu hewlett-packard is. they'll divide it up in two very logical way, they've got slower growing pc and printer division and the faster-growing storage servers and networking group. as meg was saying, dividing those in two different companies, they'll operate a lot more efficiently. a lot more effectively and it's a lot more challenging environment for both businesses. >> who is better at managing expectations, than meg whitman? it's been masterful. setting the bar low enough and jumping over it. you say that faster growth enterprise business, here's my question. we see the mixed results in the hp ink business. the enterprise, the commercial buying was down as expected with the end of the xp rebrand cycle. the consumer came back a little bit. but enterprise services didn't do so well. software going nowhere.

and the cfo who was going to go with the enterprise business, deciding she would rather go with hp inc., what's the path to success for the enterprise business, that's number one in so few categories that are actually showing growth? >> both businesses are under pressure for sure. you know the core pc and printer business, you have the changing nature of how people you know compute in their migrating away from pcs towards you know towards tablets and smartphones. the supposedly faster growing storage and server business, that business is under pressure. you've got a changing of the guard and the whole software industry is getting reinvented by the cloud and other buzz words out here. hp is going to have to figure out how to handle these new trends. >> if you look at why the stock is higher, one of the main reasons for that is because they're taking a $2 billion, extra $2 billion charge within enterprise and there's a

suggestion that there could be tens of thousands of jobs to be cut. on top of the 55,000 they're headlining. is this is the only way out for big tech to split and focus on cost? >> think that's the short-term you know, solution. which is you know try to operate more efficiently and more effectively. long-term, you can't win by cost cutting. you're going to have to invest in growth and have to figure out ways to play in some of these new emerging enterprise markets. and the enterprise market, roughly $1 trillion is up for grabs across this whole software stack from the compute layer up to the software that enterprise users are interacting with on a day-to-day basis. so hp in order to continue growing, in order to create more value, they're going to have to get out of just cost cutting mode and be aggressive and make sure they're making the right bets to play some of these growing trends. >> that's what i was going to ask about. the word cost-cutting is a buzz word.

it is play indicate wall street to a certain extent. will it have longer-term effects on being able to recruit and retain top talent? >> yes, i think it will help them. think you end up recruiting very different people for those two businesses. in the faster growth enterprise side of the business, there's a certain type of engineer, a certain skill set you're going to need working on those products. selling it to those markets. and so i think being able to separate that out from the slower-growing kind of pc and printer group, will help them become a more attractive place to acquire talent in a very tough hiring environment, as you guys probably hear about hiring out here is tough and stls a lot of great companies hiring talented engineers, think they're doing the right thing by separating the businesses out and making the opportunity at hp for smart engineers to go there and be an attractive place to work. >> well investors like what they've heard from meg whitman, the stock up despite revenue down, 7%.

according to the wall street, uber is seeking a $1 million credit line from the banks. uber asking six or seven banks how much they would be willing to commit and at what terms. uber is not expected to go public until next year at the earliest. the company still valued around $41 billion. roger, what's the attractiveness of doing something like this now for a company? even with an ipo so far off? >> yes, i think there's a couple of interesting stories here. one is it's clearly a signal that uber is preparing to go public. we saw similar credit facilities raised by alibaba and facebook in the years before they went public so i think they're doing it the bigger story a cost of capital story. these guys are able to raise money at valuations that no one else in the industry can do. their cost of capital is possibly 20 or 30 times cheaper than their nearest rival, lyft. whether it's raising the $1 billion credit facility or razing equities in the private

equity markets. they can use it as a war chest to compete against lyft and their other rivals and make life very difficult for them. it's interesting because lyft announced big financing from carl icahn this week. icahn's whole thesis is that this market is big enough for two winners. the reality is that uber has such a significant change in scale and cost of capital, they can make life very difficult for lyft and this credit facility is part of that strategy. >> what would buying nokia's maps business here mean to them? i see that nokia stepped back and said we're in no rush to sell. obviously the price tag is closer to $4 billion. >> yes, so i think you know mapping is a core part of uber's strategy. at two levels, one it's the actual kind of business they're in right now. but then more importantly, you probably hear stories about their driverless cars and what some of the innovation they're doing there. which puts them in a crosshairs with what google is doing in the driverless car space as well.

google own as lot of the core mapping technology that uber uses today. it's important for uber to control that whole technology stack. and if they don't control the map and you've got a driverless car, you don't know where you're going to end up. it's an interesting and aggressive move for them to own that mapping technology. as they continue to innovate and move towards a driverless future. they'll have the right data and the right mapping technology to deliver those services. >> one thing is clear, they want to put themselves in a position of leverage. and it will be interesting to see where the company goes from here. >> yeah, totally agree, it's been incredible to watch. the automotive industry was devoid of invasion for 50, 600 years and in the last five years we've had google and tesla and uber with driverless cars, so it's amazing to watch what's going on across the entire system.

we're going to see more and more. and i think make life difficult for the rest of their competitors. >> they have the banks wrapped around their fingers, roger lee, thank you for joining us today. let's get a check on the markets. right now major indices pretty much just hanging tough in there. the dow down about .2%. s&p off the lows. and nasdaq doing best of all, up just a fraction. keeping an eye on retail this morning. shares of gap down over 1%, after the company reported a mixed quarter with profits falling 8%. foot locker in the green. the company beat on both the top and bottom lines with profit jumping 14% year over year. coming up, ipad sales are down 23% year over year, but apple is reportedly giving the tablet a reboot. we have details. plus shares of intuit rallying after earnings easily topped estimates. they made it out of tax season after all. the ceo is with us in a cnbc

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according to reports, apple is working on a new 12-inch ipad. which would be revealed as early as next month's worldwide developers' conference. for more let's bring in 9 to 5 mac senior editor mark gereman. great story, they're prepared to cannibalize the mac itself with a bigger ipad? >> perhaps with ipad sales down, they basically now have a three-pronged strategy for taking the ipad into the future. the first thing we'll see from them is actually going to happen, at the june 8th worldwide developers' conference keynote. they're working on a new view for ipad apps, that allow you to use two apps at once or two portions of apps at once. if you want to work on a word document or a presentation while getting research information off of the web, you could actually have both a web tab an a word tab open at the same time. and copy content from one side

of the ipad into the other. so that will really spark more usage in the enterprise, education and even some home uses. >> i know from the article you say this side by side function, which i think with split possibly three ways, of the two, which would be aimed at more to get corporations or small businesses to use it more? or would it be people who want to do perhaps price comparisons on shopping at home? >> well it would definitely be more oriented towards enterprise and small businesses. but part of that will also spur more cannibalization of macs, since that's a feature that the mac has had from the very beginning. it's big for the education market. >> mark, what's your take on what's taken apple so long to ship this? your reporting has shown for the better part of the year that apple has been working on this,

samsung has had multitasking in its tablets for a couple of years now. when i look at multitasking, i look at the maps and public transit stuff you've been working on. is this an engineering process problem? or is it something else? >> there's a couple things going on here. with the transit maps, they originally planned to release that last fall. they were ready to announce it last june, but at the last minute, they pulled it if release, we're told, because the data was not ready for primetime. but it sounds like this time they're ready to get the transit information into their map software. in terms of the split screen, that's taken a while because of the compatibility required by applications or to work better together. they sort of enhanced it over the last year as weg. making sure it can run in different sizes, different ipads and really optimize it for the 12-inch larger ipad that's going to come as early as this fall. >> what will be most important for the functionality of the split screen? there are a lot of critics who

say it's an absolute necessity for apple to win in the enterprise. you're going to want to be operating your personal apps, as well as your professional apps at the same time. >> that's right. that's one function of it. you can have your twitter for personal on one side and perhaps a business account on the other side. it's very big for that it's also huge. you need to work on an excel document on one end and an email with your data on the other end. that's something you've been able to do on macs, laptops and the microsoft surface. but it hasn't been on the ipad. they're perfectly going to time the launch to be for this larger ipad. and they're also working on this feature for the smaller existing ipads. >> good to meet you, mark. thank you for your time. >> thank you. >> 9 to 5 mac. let's get to a news alert with meg tyrell at headquarters. >> news coming out at activist. a u.s. appeals court ruled that

the company must keep its drug amenda on the market. the attorney general had sued activist to keep the older alzheimer's drug on the market. pull the older version of the drug off the market before its patent expired. switching patients over to a newer, more expensive, once a day version, so when the cheaper generic copies hit, it would be on the new branded drugs. the u.s. appeals court ruled that activist can't do that. it has implications for the entire drug industry which tries to do the hard switch drug technique. >> thanks. up next, check out shares of turbo tax maker intuit. rallying up 3%. topping analysts estimates. the ceo will join us coming up. [ male announcer ] your love for trading never stops.

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somebody got a nice little something back this tax season. shares of intuit up 3% this morning. the maker of the popular tax software turbotax reporting earnings and revenue last night that topped wall street expectations, crediting a strong tax season. joining us exclusively, intuit's ceo, brad smith. we talked about tax season as being your super bowl and this year, it was kind of like you threw a couple of picks early in the game. and then last five minutes, really rallied and pulled it out. my first question is this -- based on everything that happened, you had the fraud concerns for the industry overall, that you were able to battle back from. some issues with your pricing. that you're able to battle back from. should you even be charging specifically for tax prep any more at all? why not just have people pay $15 a month. give them some credit

monitoring, other perks and say do your federal and one state for free? isn't that the way? >> it was an event-filled tax season. our team did a wonderful job. swee expanded the category, taking share from tax stores. we increased our own market share in software and ultimately exceeded expectations, to answer your question about the model, customers pay for value. and many of our customers do file their taxes for free. in fact this year we had a program called absolute zero. in the first part of the season people could file their federal and state taxes for free and buy add-on services, that was one of the key drivers of our growth. so yes we continue to evolve our model. i think the customer is willing to pay for value and you saw it in the results we had this year with market share. >> legacy desk top challenges, trying to migrate some people, which you backed away from. you seem to be getting a nice handle on that. also cloud challenges, we've had folks like zen fits and zen

payroll on this program trying to change the way small businesses approach payroll and other things to manage their businesses. how do you look at that? do you think you can beat them with your current model? or do you have to join them either through acquisitions or by changing your model. coming out with a product that also approaches cost from the same perspective? >> well the good news is we already have products that approach cost from the same sperk in. we have a cloud-based payroll product that grew another 20% this quarter. we have 700,000 customers using that product. and we have an open platform. so quick books, our online accounting product works with zen payroll and some of the other names you mentioned. so customers can choose which solution is best for them and choose one of our solutions like quick books online. as long as we're part of the choice, we always have the opportunity to expand our opportunities overtime.

>> zenefits, gives away the basics for free and makes money on the back end. >> they're well funded, no need to worry about them in particular? >> we always keep our eye on competition and i really admire some of the companies you named, including zenefits, everyone is looking at different ways to approach their model in the clouds. we have three solutions that eventually you monetize in other ways, which is pretty similar to the way they approach their business. i wouldn't say we go to bed every night and are comfortable. we're constructively dissatisfied. but i feel confident our team has the right strategy if place and we continue to grow. >> a number of analysts have a neutral or market perform on your stock. you're trading at all-time highs, up above $100 after this report. what should investors take away from what you are going to be working on investing in between now and the tax season, the next tax season? we know about q 4 and q 1, they tend to be not the most exciting

quarters. you're behind the scenes working on stuff. >> i would say the thing that people are trying to get their head around. we're trying to aexpand the market season in tax. this year, software once again took share from the tax stores and the assistant methods and that's now three points a share over the last two years. the reason why is because the products now are so much easier to get your taxes done. it prefills data for you, it helps you find deductions you would not have found on your own and it does it at a much lower price than going to someone else. that's just complete upside for us to go from 50 million to 148 million, that's the total addressable market from the way we see it. >> brad, you guys sure had us watching closely this season. it was an eventful tax season. you managed to pull it out. i guess congratulations with results on that, brad smith, ceo of intuit. let's check where we're closing in western europe at the moment for the day and the week

as well. they won't have the public holiday on monday that we will enjoy. flats are negative overall. top gainer today is vodafone. vodafone has had one hell of a week. let's check out where we are on that stock. it's up 8.5% above $100 billion in value. john malone at liberty global saying potentially though he didn't say they were in talks, it's a good fit and a big discussion about whether or not vodafone could sell assets, bra he can it up or do one big deal. that stock something propelled skyward into the weekend, a good gain there. >> to the east of europe and to riga, latvia, the 28 leaders of the european summit met with their former soviet neighbors. the big news as far as the markets are concerned is what went on with greece. angela merkel, protocol putting her at the back. the greeks suggest they could have a deal on the cashable reform negotiations within ten days. what's more important, think is that merkel last night met with

the greek prime minister who you see there, well into the night and after that, this is the quote, clearly, very clearly, further work is needed with the three institutions. that's basically a rebuttal to him. she is saying you have got to work with the finance ministers, not me. and we are focused on the figures. that's diplomatic code for get back to the talks. meantime citi is suggesting we could have an agreement with greece next week or early june as we reported earlier in the week of course, the germans are anxious not to have it interfere with the g-7 summit they're hosting. >> i imagine they are anxious. simon you'll bring us the latest of what happens. >> every day. >> except for daylight savings time. that's another issue altogether. is apple tv going local? re/code says it's a major possibility. co-executive editor kara swisher will have the details, when we come back.

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hello, i'm sue herera, here's your cnbc news update. weather has slowed the clean-up efforts at the site of an oil spill that has fouled california's santa barbara coastline. crews have yet to ex-indicate a section of the pipeline that broke on tuesday, spilling an estimated 105,000 gallons of crude. more than 9,000 gallons have been raked, skim and vacuumed up so far.

the norwegian cruise ship that ran aground off the coast of bermuda has returned to boston. carrying 3500 passengers and crew hit a reef on tuesday, no reports of injuries. france's highest court has rejected uber's bid to have much of a recent law banning its services declared unconstitutional. uber sought to overturn the restrictions after taxi companies protested. and disneyland sbralting its 60th birthday. thousands lined up waiting to enter the magic kingdom. the park will be open for 24 straight hours. so happy birthday to the happiest place on earth. and that's your cnbc news update this hour, let's get back to squawk alley. thanks, sue, i thought the happiest place on earth was post 9? let's bring in kara swisher, co-executive editor at re/code. kara, great to have you. a new report from you guys

saying apple wants to include access to local channels in its planned tv service. however, that might cause the delay of that tv service, what can you tell us about why apple might be interested in local channels? just trying to have a little bit of an edge on the others out there? trying to placate the tv providers in to thinking that local is important? >> i think they want to have a richer experience and a different experience, it's something that people, consumers would want. it's really hard when you're working on these services not to have that. they want a more round service, it also is great for broadcasters, just more complex. because a lot of the, a lot of the big stations are not owned by the broadcasters. they used to be before. but you know, i think it's to be more competitive in what they're doing. it's a very difficult thing to do to add on. so that's why we talked about the delay. >> has the wound to local healed

to the point where the conversations can be productive. >> i think apple is going in, it's different than aerio. they want to placate them in terms of being able to reach where consumers are. you want to go with someone who is trusted. areo came in in a different way. than this did. i think it's a, apple is a different creature in that regard. but you know they need to be in discussions with the broadcasters to placate them, to give them assurance they're helping them build audience. >> kara, are you talking about the nbc or the cbs affiliates here? is this just part of -- >> yup. >> because these are popular channels, it's not revolutionary to want to put local news on the television, that's what large swaths of the population watch every evening. >> it's not just o & o. there's a lot of o & o in the big cities, all over the country there's all kinds of great local programming that people want to see. this is what they're trying to

offer. because there's so many local places, it's quantumly more complex to do. >> up next, twitter investor chris sacka could be ready to show the company tough love. in a blog post he wrote i'm soon going to post a few things that i personally hope the twitter team will accomplish. i want to make it clear that my feedback comes from a place of loyalty and persistent gratitude. i love twitter. he says he doesn't have insight into the product direction. i got the sense he feels like maybe he's not being listened to on a personal basis, so he needs to go public. where do you think this is coming from, kara? >> i don't think he's throwing a tantrum. it's interesting, chris has been a twitter cheerleader forever. you've had him on the show. he talks about it possibly he could be a little frustrated. i think he was trying hard, to say i bleed aqua and i only do this out of love. but let me tell you what to do. so it's going to be interesting to see what the posts are i'm sure they're a little nervous to

twitter hq. chris is a very outspoken person, he's a great investor, someone that has a lot of opinions and he does have a lot of insight into twitter. he's close with the people who created it. i think he probably feels like he has something to say and i don't know if he's not being heard. it's just a way to be heard more clearly, if you post it in a belong post. so that's what he's doing. >> well kara, you mentioned that he's a cheerleader, he came on the air a couple of weeks ago when twitter announced earnings, that was the last time he was effusive in his praise for the company. he says in a blog post that his change of heart came almost immediately after that appearance in a conversation with our own jim cramer. i'm wondering if that tells you that even twitter loyalists have a hard time figuring out where they stand on this company. >> yeah, i think that jim was here. think that's where they ran into each other and they had a discussion. jim has his opinions about it jim was swayed a little about the potential. i don't think jim is not talking about the potential, he's talking about the execution. i think, they did have a

conversation, think it was in this office. where -- >> a lot of people were watching it. >> oh yeah, that. that was interesting. so what was important about that was that they were sharing ideas and i think jim, afterwards, i talked to jim in the office and jim was saying there was a lot more potential. at the same time chris is a smart guy, he's got to know there's challenges and pretending there's not challenges, chris is not like that. >> does it destabilize dick costolo just at the margen? >> i mean that place, every day there's something else, right? you know, it's a little bit like a goat rodeo sometimes. who knows what investor is saying what. this is a group that dick has had a in a much more pressure situation. believe me, he is in a pressure situation. you know we're going to announce later today, he's coming to code with the periscope founder and

there's going to be a lot of questions for him. this is a dicey time for him. he's got to perform or have some answers. especially when investors like chris are speaking up like this. >> i wonder which is harder, herding cats or organizing a goat rodeo? things to think about. >> goat rodeo. finally kara, it's that time of year, the code conference kicking off next week with big names like mary barra, evan spiegel. set to speak at rancho palas verde. what should we expect this year? >> we've got amazing speakers, every speaker is a star. les moonves from cbs and elizabeth warren. dick costolo. we've got ellen will be a really interesting interview. the ceos of three of the hottest

start-ups, slack, houz and stripe. a range of people we're going to be talking to. the founder of oculus. and the editor of buzzfeed. >>. >> you know what, i invited gavin newsom to come as the real person. so we'll see. >> why do you invite elizabeth warren? >> well i think you know, early this year i interviewed barack obama and then hillary clinton and i felt like elizabeth warren is really talking about a lot of issues that i think the audience needs to hear. obviously she's become a power player in the democratic party. we're moving into an election year where she's going to play a big role. she has a lot of opinions about income inequality, gender disparity and all kinds of things that she talks about. i think this audience needs to think about, where our country

is going and hear an opinion of someone who has strong opinions, she is super intelligent and i think it will be a very interesting interview. and right now she's in the news because of trade agreement, disagreement she has with president obama. so we're excited about that intersue. >> well with all of those headlines, sure to make news and that's why we're going to have live coverage from the conference next wednesday and thursday. kara swisher, thanks so much for joining us. have good weekend. up next, call it the uber for drones. a company connecting people with drone pilots to help their businesses, we will go live to their headquarters in just a moment. also ahead, rick santelli on cnbc. after the break, we're definitely going to be talking about not only today's data, but janet yellen, she'll be speaking at 1:00 p.m. eastern. and the most important aspect of all, data-dependant and the yield curve.

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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. coming up, getting ahead of the fed. we're getting our portfolios in order for when rates are raised. summer's hottest stock, ohm one s&p name up every summer for the past ten years and it averages 20% returns. and i bet you can't guess what it is. we're going to tell you. and one of our traders made a big call about a retailer on

monday, he hit the bull's eye. we'll tell you what it is and how to play it now. one san francisco business matches builders and farmers with drone pilots to help them. think of it as an uber but for drones. jane wells is live at their facility in san francisco. jane? >> kayla, you know i'm thinking i need a drone for a job but i don't want to buy one, i don't know how to run one -- there's one right there. i can rent it and the pilot all due to a start-up that's gotten $25 million in vc funding called sky catch in san francisco. >> i'm going to arm the machine. arming -- >> while the faa figure out what to do about drones, the number of business who is want to use them is exploding. matched by the number of pilots able to fly them. >> i'm probably 50 feet above the roof. >> now a company called sky catch matches the two with work vote. a sort of uber for drones.

need a drone for a job? put out the call on work mode and a pilot will respond. >> this is the opportunity for pilots to get in and start training their own business. >> sky catch trains pilots and has already certified nearly 1,000 of them, including tom waclo. >> it's still a knew industry. it's been great to have them help me find work. >> for companies like air systems, regular monitoring of construction sites lets them compare progress against plans. each flight costs from $400 to $1,000. >> if we didn't have work mode, we would have had to buy our own drone. trap our own pilot. and potentially carry a little bit more liability insurance. >> the heat maps show where there was activity on this site yesterday. >> where sky catch hopes to make money is processing and analyzing data. it can analyze how much dirt has been removed to let you know how fast crews are working and with backing from investors like

google ventures, sky catch is growing in other countries and other industries. for drones, the sky is really the limit. >> a year from now, we're probably going to be doing things that we don't even know today. >> now sky catch has gotten a couple of faa exemptions for its own drones, some of the pits that it certified have exemptions. here's the deal, the biggest customer is not in the united states. it's in japan. the construction mining giant komatsu. jane wells on the west coast. time for rick santelli and the santelli exchange heading into member yat day weekend. rick? >> absolutely. and i'm going to be moving fast, thank you, psychen. a lot of things to cover. first thing to cover is normally when you get data points whether it's housing starts, cpi, you get the street. making alterations to their expectations of future data. and cnbc has relationships with all, i'm going to pick on one in particular, come to my board.

barclays, we're going to be talking specifically, q 2 gdp on the 13th, they were looking for 2.6 and land fed was looking for .7 on the 19th. that was the data housing starts released. very strong. they move from 2.6 to 2.7. atlanta fed stayed at .7. today, we get a little bit hotter cpi and the whole notion of taking the economy and deflating the number into all of this. they downgraded a bit to 2.5. i've been unable to confirm with the atlanta fed their most recent read. considering the trend, i highly doubt if it moves from .7. where's the reality here? allky tell you is they've had an awful hot hand. now let's go to the yield curve so i'm going to have my ribbon. like my ribbon for the yield curve. if you recall, right now we have a 156 on 5s, that yield is higher both overnight and pretty steady overnight, but higher than the 54 that we had earlier

in the week. we're at 221, up two on 10s, they closed to 214. 30s, basically a push like 5s overnight, but it settled at 293. the point is when the yield curve flattens and it gets flatter versus being steeper, the flattening is based on selling the short end. what today, would have put more selling in the short end? let me think, maybe the hotter cpi? now we can all debate whether it's sustainable. we had hot gdp numbers like second and third quarter of last year, but they didn't pan out. they weren't sustainable. is this the push that matters? i don't know. but i do know one thing -- today-dependant. data-dependant means we've had so many experts come on say when it comes to the fed, it's the path more important than the lift-off. i don't know. maybe somebody at the federal reserve ought to hold the position of their own stocks, because let me tell you, the day of lift-off is super important if you'ral the way long in

stocks on the day of lift-off, even though you're more concerned about the path, you may have a problem with your path in many different ways, now when it comes to fed -- ira, ira harris, real quickly. most people are talking today with cpi data, we didn't see big movement in the june or july fed funds, does that mean there's no tightening in june or july? >> no. >> we're almost out of time. you happen to be short september fed fund futures. because it's a cumulative effect. whether they raise rates in june, raise rates in july, you fully get paid in september. is it a good conclusion to say, if the fed says no june, maybe no july. but does the market believe that? and does the fed fund contract with the selloff and set show the possibility for june and july? >> yes and anybody looking for a return, risk/reward, it's a 6-1 pave. so if i'm wrong, i risk one, with a gain of six. it's probably the best bet other

than american pharoah. >> at belmont. i didn't mean to pull you in. go back and make some money. kayla and everybody, have a happy and safe member memorial day. >> live television from rick santelli, have a great weekend. when we come back, nearly three years ago, a vc at kleiner perkins bought the golden state warriors for $150 million. fast forward to today, the team is in first place, worth more than $1 billion and two wins away from the nba finals. the owner joins us next.

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the golden state warriors eked out a win over the houston rockets last night. now the team is only two games away from the nba finals, that's sure to make vc and owner joe la lakeub very happy. >> well kayla, there's still confetti on the floor here at oracle arena from the celebration last night. i can tell you the place was rocking last night. now joe lakub did buy the golden state warriors in 2010 for $450 million. forbes pegs its value at $1.3

billion. lakub is a long time vc, i asked him are there similarities in building a successful start-up and an nba powerhouse, lakub says there are and it comes down to one thing. >> the people, the people, the people. that's what matters. you have to have great management and the management have to hire great people underneath them. and you have to build a team, an organization and a culture and yes the specifics of how turn the organization around are maybe important. but actually it's the people that do it. >> now lacob isn't the only professional investor. you've got mark cuban, paul allen, others that own teams. lacob said he's got advice for steve boll mer, running an nba franchise is a lot harder than it looks. >> bolmer was at microsoft for a

lot of years, think he'll find this to be more challenging than he thinks, this is not easy, this is very complicated. though not the largest business that some of us have been associated with. it's very complicated in terms of the media in terms of the business, sales aspects, in terms of the so many things, the basketball side, it's a multidisciplinary type of activi activity. >> i asked lacob about the $1.3 billion valuation. he said that's not what he's focused on. he says what he does care about deeply is winning the championships. >> the truth of the matter is, i don't know what it's worth. it's probably worth a lot more than we paid for it and that feels good for my investors, i know i'm doing the job for them, my limited partners. but other than that, we're trying to do good, trying to build something the community can be proud of, something we can be proud of. and we want to do something for the fans here. >> now game three with houston

is tomorrow night. by the way as a long-time vc, lacob can spot a tech bubble. i asked him whether the current market has him worried. he says it does not. these are real companies with real revenues, this time is different he says. guys, back to you. when we come back, shop while you watch youtube? details in a moment. part adventure. it's part geek and part chic. it's part relaxation and part exhilaration. it's part sports car and part suv. and the best part? the 2015 gla. it's 100% mercedes-benz.

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news just coming in from the state department, saying it will make publicly available online. 296 emails from former secretary of state hillary clinton's email account that will happen at 12:30 eastern. deputy spokesperson marie harpf, saying the email does not change the essential facts or understanding of the events related to benghazi. these emails were previously provided to the select committee on benghazi in february. so we'll be watching that in 30 minutes' time that developing story in washington. meanwhile, watch and buy, youtube is adding a buy button to some of the its retail apps. google's new push to make the video streaming site more interactive. youtube, unclear how much of a

profit it makes on its own for goog. the company's senior product manager lane shackleton says the new app format makes the path to purchase shorter for customers. >> these buy buttons are simple for google. they're revolutionary in changing the face of commerce around the world. >> this looks similar to a product that mastercard has been using in digital magazines. you see an ad in the magazine, and you can directly click. they're trying to beef up the ad prices that advertisers are willing to pay. people normally purchase more. >> but it's also the fact that google is going to host the pages and process the payment for the other retailers, which puts everybody on much more of a level playing field to fight the incumbents. which is amazon and ebay. no plans for the long holiday weekend? break out scrabble.

new words have been added, lolz, facetime, blech, emoji. >> the show is over, thank you, simon, so much for joining us. >> enjoyed the scrabble. >> over to the halftime report and scott wopner. >> let's meet the starting lineup for today, steve weiss, josh brown, dan greenhouse and steve liesman. our game plan looks like this, summer sizzle stock. the only name over the past ten years that's been up between memorial and labor day every year. you'll never guess what it is. the big hunt, latest and greatest trends in great outdoors, from "new york times" bestselling author david farber. >> we begin with the growing chance that the fed will raise interest rates later this year. no bette