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♪ ♪ welcome it "squawk alley" for a thursday morning. joining us today, jon steinberg of the ceo of the "daily mail," north america. jon fortt, kayla tausche. watching the morkts, we've lost a lot of gains as we got the headlines from the imf saying technical discussions with the greeks have essentially stopped. and their team has returned from brussels, dow sup 100 points prior to the news. but now a gain of just about 36 points, we going to begin with some breaking news, our own david faber reporting that rupert murdoch will step down as ceo of of 21st century fox. david is here to update the story for you. >> a change at fox, keeping it in the murdoch family, no doubt about that. as we first reported, rupert murdoch is preparing to step

down as ceo of 21st century fox. he'll hand the title to his son james, that according to sources close to the family. the timing here of the change is still unclear to me. it could take place in the very near term. it will be announced in the near term. but it may not actually take place until let's call it 2016. either way, murdoch, that is the elder murdoch will continue to be the executive chairman of fox and his son, lachlan is going to take over as the executive co-chairman of the company. he's currently nonexecutive co-chairman. but that's an important distinction. ceo chase carey is going to step down from that role, he'll take an advisory role with the company. sources tell me. he is likely to remain at the company in some capacity, perhaps through 2016. but james murdoch going to be taking over the day-to-day management of fox. he will work in tandem with his brother, lachlan who is one year older at 43 and his father who is 84. fox spokesperson said the matter of succession at the company is

on the board of directors' agenda at the next regularly scheduled meeting. the meeting is taking place next week. they declined to comment further. important to point out that mr. carey's stepping down as ceo is going to leave the company without a layer of senior management outside the family. for many years the role was filled by peter churnen, he departed in 2009 as coo. he was replaced by mr. carey. who has been applauded by shareholders for his overall management. rupert murdoch, who through the murdoch family trust controls 49% of the voting shares of the family company, not expected to change much of what he does day to day as chairman of fox and newscorp. but the change clearly is they're acknowledging the next generation of murdochs is ready to take its place and it will be interesting to see how the two brothers, so close in age, but very different in personality types, will deal with each other. lachlan certainly expected to

have a broader strategic role, if you will. and the day-to-day operations to be run by james. >> some of the threads that have emerged since you first broke the story is maybe an heir, a singular heir becoming less apparent. because you have lachlan in the chairman role and you have james ascending to the ceo role. but also this seemingly reversal of fortunes for james murdoch. who was taken off of bskyb just a few years ago. there was a sense that he would have to prove himself again and seemingly he has. >> four years ago, the hacking scandal engulfed bskyb. he lost the role in running that as a result of this, came back to new york, laid low. many people say listen, nobody knows the business better than he does, nobody knows the business units better than he does at this point. people tell me he's matured they believe as a leader and just in general. and digital is really been a key

focus for him and of course, as it is for so many media companies who are still trying to figure it out. that is sort of where he's already made his mark and is expected to continue to as the company's ceo. >> david, can he just hand down the ceo title? granted he's got control of the shares. you know james has been in the company. but do the shareholders have any say? is there any possible squawking that will go on that carey is out, carey was a great executive. you give it to your son, maybe he's not the most qualified guy. >> carey, it's interesting, i thought he was absolutely out. we'll see what his future holds, some people tell me he would love to be the next nfl commissioner, chase carey. for now he's going to stay in some sort of a role there to your point, the board is meeting, but they're just going to basically say okay. now this kind of a thing, this transition, it's not as though it's going to come as news to the board of directors of fox, excuse me. they're well aware of it. they've been weighing in on it for some time. and so, no, i mean this is not a shareholder issue. you might you know, value act

own as significant stake, i believe they are firmly behind what is going on here and i aligned with james. i don't expect to see much of anything and the board is expected to put its stamp on and approve this change. >> david, should we look at this as giving chase and james an opportunity to operate in their strengths and maybe see who is more ready to be the guy? >> you mean lachlan? >> yes, lachlan and james. >> i expect this to be the way that this company will be run for the foreseeable future. james running day-to-day and lachlan -- they're describing it and many people who have spoken to the murdochs, who i've been talking to in recent weeks, in putting the story together, tell me they keep describing it as a partnership. >> they hang out on the weekends? >> they're brothers. >> re they brothers or are they bros? >> i wouldn't be able to comment. >> now going from to fighting over toys as kids to controlling one big toy together. >> they are. now listen, again they're very different.

but they're describing it as a partnership. although frankly, in most companies, the ceo does report in to the chairmanship. now by the way, there's still another guy who is chairman, his name is rupert murdoch? and you know, he's going to be around and basically still the final decision, any momentous decision is still going to be his. >> david, we know you'll be on top of it, thanks so much. david faber, at post 9 the top of the show. facebook's annual meeting kicks off in three hours. it comes the same day as facebook's oculus holds a press event. a new headset set to go on sale in the first quarter of 2016. we got a sense of this a couple of weeks ago at code. did you try it on? >> i did. >> it's amazing, it's not like you put the oculus rift headset on, the new one and you feel like it's relife. but you feel like you're in a virtual world. >> for example, you were asked to put it on and what you saw

was if as you were about to step off the ledge of a building. >> yes, and i would not step off. >> you would not step forward. >> because it felt like i was going to fall. i mean i tried -- >> the rest of us are shaking our heads. >> just couldn't get myself -- >> but you know what's amazing, you look at the news on this company in the past 24 hours, they're going to have oculus out for $1500 in q 1, which is the future. the far future. at the same time, they launched the buy button, which is performing unbelievably well with shop fi, they've got direct response in a way that twitter can't get direct response together. they've got their video advertising product. putting major pressure on youtube and advertisers are loving it granted, yes i'm a partn partner, we work with them. if there's ever a company which is firing on all cylinders, it's hard to argue they're not. >> the last investor day, the company was asked why are we here voting on proposals, we don't have say at the end of the day. it's a company controlled by mark zuckerberg. >> we just talked about a ceo that appointed his son ceo. soy mean in retrospect, it's not

quite that crazy. >> but on oculus, it's interesting, that they're coming out with this $1500 device, we're going to talk more about oculus in a few moments. but google has google cardboard that they unveiled at google i/o. $15, 1% of the price. >> no comparesen in the experience. >> why not? >> it's just -- the $1500 includes a high-powered pc with a high-end graphics card and the headset itself. the headset itself is more in the $500 range and the pc is closer to $1,000. but you put on the cell phone, the smartphone close to your face, and, yeah, it feels like you're playing a game. but it doesn't give you the same immersive sound, feeling that you're in this other world. so yeah you can kind of, kind of play around with it. but you if you want to be immersed in an experience, you cannot, you can't, there's no substitute for the oculus. >> who will be late to the party again? potentially with the strongest beverage? apple will wait years and years,

everybody will kill themselves around a little bit. apple will come in with some white, shiny -- pr device, four or five years from now. >> they used to say apple will come out with a gaming console. they never did. i don't know if apple has got a play in this area. i don't know if they're good at this. >> i think vr has blown me away with how good it is for sbaxt i have not played with it yet. a line was too long at a conference i was at on monday. but everybody i spoken to has the reaction you did. they love it, they say it's game-changing. >> we're in the early days of the technology, right? you think it's impressive, we'll see what it's like in two or three years. john mentions apple in what could be a big blow for publishers, apple appears to be close to letting users block froods their iphones and ipads. the desk top version of safari has ad-blocking tools, apple could bring the same technology to safari on mobile. as the use of ad-blocking tools is growing. one study says the number of people with ad blockers is expected to rise by 50% this

year. jon, you can't be happy about that. >> this is yet another issue we publishers face. i was thinking about it and reading the notes, oh my god we're like a punching bag. ad blocking is a real thing, not just in other words anerds and . one of the salvations that we had was in mobile, you couldn't install ad blocking and now the code from ios 9 comes out. people will be able to download an app and block it for mobile. the funny side note here, where are the ads not going to be blocked on apple? apple news. the proprietary news reader. >> this will drive people into the wall of gardens. >> there's an argument to be made that apple is saying we're going to block ads on the web, but not in our news thing. >> people are talking about that fact, that they didn't announce necessarily that you'd be able to block ads in safari in some of the new devices, at the same

time they're trying to woo publishers and advertisers to get on board with apple. >> i worry that the normals, people not geeks are standing around. all the geeks are talking about how fast their phones are to browse web pages with this great ad-blocking app and it's like whatsapp, like wildfire, it's a huge issue. >> you say you like the ad business, you say you'd rather be in that than the premium sub business? >> i think it works out some way. advertising doesn't go away. tv is under tremendous pressure, people will have to sell their products if we have to go to original video and content advertising and the traditional display business just goes to zero, people will need to advertise and sell products, i'm happy to be in that business. >> newsrooms aren't generally too happy about that, right? >> most of them have come around to native advertising. it's the facebook product, google product, twitter product. four or five years ago when i started pushing for native advertising, there was much less

resistance, now everybody has a native advertising lab. now everybody is doing it because there's no other way to do advertising. >> jon steinberg joining us at post 9. d.o.t. just released its air travel consumer report card. phil lebeau is all over this, in chicago with details. hey, phil. >> in the month of april, more than 81% of the flights in the united states were arriving on time. which airlines did the best job? according to the d.o.t. in april, it was hawaiian, more than 92% of its flights on time. followed by alaska, and delta, which airline struggled? in the month of april, frontier was the worst. just 72% of flights on time. spirit a little better and envoy, third at 77%. mishandled bags, 2.93 bags per 1,000 passengers and finally, one flight with a tarmac delay of greater than three hours. the latest statistics for the month of april. which overall, carl, when you listen to the numbers, not a a

bad month if you were flying around in terms of getting to where you needed to be on time. back to you. >> and phil, perhaps not coincidentally, i hadhawaiian holdings up about 2%. let's check in on the overall markets, which are still in positive territory. the dow and the s&p are on track for their best two-day gains. since about a month ago. if the dow gains more than 100 points today that would be the last, the first time that we've had triple-digit gains back to back since early february. so we're watching that. the dow currently up about 62 points. s&p up five points, nasdaq up ten points. we're a quarter of 1%. we came off of those highs when we got news that the imf said that they had halted talks with greece. shares of lululemon slipping after founder chip wilson filed documents enabling him to sell his shares in the future if he chooses to do so. that stock is down about 2.33%. but so far, we should note wilson has not sold any of his

stake in the company. it's about a 14% stake. and carl, it's rare you do see a founder liquidate their holdings, but he has a right to do so if he chooses. >> not a lot of love lost between his family and the board. when we come back facebook gets ready to unveil the latest from oculus, one study says virtual reality could be a $150 billion revenue market in five years. we'll look at the numbers. plus he was one of the earl yeblt backers of netflix. at one point owning more than 10% of the company. we'll ask him if he thinks the stock is too expensive at these record levels. and this search agency claims to be a privacy lover's dream. it's backed by big names in apple and mow zilla. ♪ every auto insurance policy has a number. but not every insurance company understands the life behind it.

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facebook is going to hold a major press event for oculus rift. its virtual reality product and josh lipton is live at the event in san francisco to tell us what to expect. josh? >> well, jon, virtual reality is now described as the next megatech theme. and today one of the industry's leaders is expected to make some news here in san francisco. oculus is holding this special press event right behind me here. now the company is staying mum about what exactly they're going to unveil.

re/code does point out the company seem to mistakenly leak images of its hardware. though oculus co-founder palmer lucky says those were old images. what we're going to see here today, we still don't know. what we know is this, jon. this has become a hot tech trend. one of the hottest trends here in silicon valley. facebook buying oculus lat year for $2 billion. jumping into vr. lot of tech giants who are actively pursuing this technology. think of google and samsung and sony. why all this interest? it's because the potential of the technology is so exciting. the idea that i could virtually attend that warriors/cavs game tonight courtside or be live in the front row seat at my favorite concert or even attend a class at a university halfway around the world. it's why digi capital says this is a $30 billion market in five years. fans, also point to the risks,

you have more and more competition and consumers have to be sold on the value before putting down money for the headsets, which are relatively expensive. oculus has told you their technology will cost $1500 when it goes on sale next year. now this event starts at 1:00 p.m. eastern, we'll bring you headlines as they cross. stay tuned. kayla, back to you. >> thanks so much, josh lipton at that event out west. speaking of virtual reality. a new report says the market could reach $150 billion in just five years. for more, let's bring in tim merrill, digi-capital founder, tim, good to see you. >> hello, kayla. >> we're doing well, we're interested in this explosive growth in virtual reality. you say $150 billion, it could fetch in revenue in 2020. how far does it have to go from here? where are we right now? >> well, if you look at the market today, it hasn't really

started, it's going to start in earnest from next year. that $150 billion figure, $30 billion of that is vr. you think about vr, it's a market where it's going to be cannibalizing and growing the console games, pc games, 3-d film and niche enterprise markets. the larger part of the market we're anticipating by 2020 is going to be augmented reality. smart glass, if you look at companies like odg working with nasa and bringing out their consumer product next year or hollow lens, that market we expect to hit $120 billion by 2020. and the drivers in the difference is that market is going to cannibalize and grow the smartphone and tablet market so we'reas vr has the potential for tens of millions of views he is, ar has the potential of hundreds of millions of users to change the market. in the early stages of the market, next year and to 2017 is vr make the early running in revenue. but from 2018 going forward, that's when we avenue a.r. taking over. ways having a chat with robert

scoville about this and in terms of timing he broadly agrees with our thinking. >> because of this eye-popping price tag, $2 billion that facebook paid for oculus last year, at what point will we begin to come to the conclusion, if it's the right conclusion, that facebook got a good deal on that? that it's paying off? >> look, i think this market is going to make, have a bigger impact and be revolutionary and accelerate faster than the smartphone tablet market did compared to the original internet. it's the right thing for facebook to be doing. if you look at companies like apple, where they haven't made any normal announcement as to what they're doing. they're going to have to enter, although we think their entry is more likely to be in augmented reality, less in virtual reality. because in terms of the market that's going to be directly affected. it's their core smartphone market. augmented reality will have a

much bigger impact than virtual reality. >> people wonder what applications it has beyond gaming. so you can, let's pretend for a moment, you can deal with your financial adviser remotely. maybe that's a little more immersive. what is there beyond playing games that this is going to be used for? >> in terms of vr, it's basically firms and niche enterprises like military, medical and education. with augmented reality. with a.r., it's a-commerce, alibaba and amazon selling things to folks in totally new ways. it's the verizon t-mobile, at&t, with people making phone calls. browsing the web. it's business applications across the piece. when you get to mark where you're going to have hundreds of millions of users, it's advertising and consumer apps from uber to facebook to clash of clans. so vr has a more specific use case in terms of games and entertainment and it's a niche enterprise uses, and a.r., much

broader applications, because basically it will replace your smartphone. >> tim, who is going to subsidize this? the hart ware is expensive. you need $1500 between the pc and the head set to get going with it. the content is going to be a cost on top of that. doesn't somebody need to subsidize the adoption of the hardware both on the augmented and virtual reality side in order for the market to really get going and reach the numbers you're talking about in five years? >> in relation to vr i think it's a question of looking at the lower-cost options, the most compelling immersive experiences are what's going to come out from oculus today. go a step earlier down. you get to the samsung and sony's morpheous and down to cardboard. there's a range of spempbs experiences at different price points. you're right about the price points about vr long-term, the compelling immersive experiences are the ones that are going to make money.

for a.r., that's where at the end of the day, the augmented reality headsets need to be able to make phone calls. because ultimately it's going to need to be subsidized by the telcos in the same way that the smartphone in your pocket is. >> we're seeing the first steps in that direction and we're awaiting the oculus announcement this afternoon. tim, we appreciate your time this morning. >> thank you very much. >> tim merel from digi-capital. in the post snowden era, this search engine could be a big hit. it doesn't track users and has the backing of the likes of apple. the founder and ceo of that company will join us next on "squawk alley." leave early go roam sleep in sleep out star gaze dream big wander more care less beat sunrise chase sunset do it all. on us.

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waiter. water. so why would you invest without checking brokercheck? check your broker with brokercheck. welcome back. a recent comments by apple's ceo tim cook highlighting a growing concern over the use of privacy user information online. joining us is duck duck go founder and ceo gabriel weinberg. a search engine that doesn't

collect or share users' personal information. you guys are going against all the conventions of how this is supposed to be done, right? you're not collecting information. you're based in pennsylvania. right? i mean come on. but first of all, okay, if you're not collecting user information, how are you going to make money? how are you going to become a big brand that people can trust long-term? >> already we're doing about three billion search as year, we're pretty mainstream. but it's a myth that you need to track people to make money in search. we make money with keyword advertising, type in car and you get a car ad. it's that straightforward. google tracks you on all these other sites because they run huge advertising networks and gmail and photos, they need the search engine data it track you. that's why ads follow you around the internet. you've probably seen that. >> in the program mattek era, isn't more granular data even more important? are you seeing your revenue continue to be stable? even as these networks want more

information to target the advertising? >> yeah. on search, and that's the thing. if you focus on web search, you don't need to track people. and that's what consumers don't understand, is their data something leaked for other reasons that they don't even realize. >> have you done, you must have run some numbers that looked at what you could be making if in fact you tracked, yes? >> yeah, it's actually, you don't lose that much. the most lucrative advertising is things like mortgages and cars. and people just literally type that into the search engine and people bid advertisers bid fors that keywords. >> what's different about the product you're running from when you have a private browser window and an existing browser, when you go incognito in chrome. there are options to turn on private browsing for whatever mainstream server you're using. >> this is another big myth people have. in incognito mode is actually for your computer and not around the internet so when you're in incognito mode. google is still tracking you, your isp still knows where you're going. all the sites you visit can

still track you. including advertisers, when you leave incognito mode. your spouse can't see where you were. >> good, i guess. how much share can you take in terms of search. is there a ceiling on that because of the model you've chose ton build? >> pew research has been doing these amazing privacy studies recently. the last one they said that 40% of americans would prefer a no-tracking search engine. so we think our market share could go really high. our main issue is just no one has heard of us, our brand awareness is still pretty low. >> apple including u.n. ios 8 include that as an option? >> yes. >> how much did that help your growth? >> we've grown 600% since the surveillance revelation started two years ago. and like i said, we're doing three billion searches a year now. >> gabriel, my idea is it would make a big difference if consumers just knew what's out there about them. and who's got the information and then have the ability to turn things on and off.

what do you think of that idea of just a clearing house for people can just see what's being collected? >> you've hit on exactly the right thing. people want, they want transparency, they want to know what's going on. they want control so they can opt out and unfortunately they're usually getting neither today. >> how come nobody is asking for that? >> they're starting to ask for it i think people, i think people legitimately are throwing up their hands saying i can't do anything. now we're offering an apple. like you comment, is offering a real choice. >> gabriel weinberg, ceo of duckduckgo. >> i get it. all the data collection, it's pretty good. thanks a lot. let's count down to the close in the uk and across continental europe. stocks giving up a lot of gains as you probably know. after the imf, about an hour or so ago said the technical discussions with greece have stopped. due to what they're calling major differenceses and that the funds negotiating team has left brussels. earlier in brussels, greece's

prime minister met with the eu commission president. a statement from the eu described the talks as constructive. so once again the imf either playing the role of a bad cop or spoiler today as we lost a good share of our gains back here in the states. when we come back, shares of netflix giving up gains after the new high yesterday. still up 93% for the year. our next guest has a good perspective. he worked with reed hastings and his firm was an early investor, at one point owning more than 10%. he's going to join us next on "squawk alley." ♪ ♪ here at td ameritrade, they're always working. yup, we're constantly making thinkorswim better. like a custom screener on your desktop, that updates to all your devices.

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i'm courtney reagan with your cnbc news update. the international monetary fund says major differences remain with greece over an agreement to save the country from bankruptcy. an imf spokesman says there has been no progress in narrowing those differences and they're still well away from an agreement. the team is returning to washington from brussels. well israeli prime minister benjamin netanyahu welcoming u.s. joint chiefs of staff chairman martin dempsey. it comes amid tense relations between president obama and netanyahu over iran's nuclear program. boeg boosting its 20-year

forecast for aircraft demand by 3.5%. the boeing expects airlines and freight firms to take delivery of 30,000 jets worth $5.6 trillion by the year 2034. and walgreen's is recalling bags of nice powdered sugar mini donuts after receiving consumer complaints that mold was on some donuts, consumers can return the product to any walgreen's store for a full refund. your cnbc news update for this hour. now back to "squawk alley." is. >> welcome back to "squawk alley," shares of netflix falling 1% today. the stock doubled what it was at the beginning of the year. joining us to talk about the company and its growth is paul holland a general partner with foundation capital. among the company's earliest backers, paul, good morning. >> good morning. >> i want to talk about foundation and how you approach the business now. but tell bus the history of your ownership in net flirk.

where did it begin? where did it end? what were, why did you make the decisions that led you through those? >> well netflix is the most successful investment in the history of foundation capital in over 20 years. as measured by market cap. we've been very fortunate, we've had 25 ipos during that time period. companies like lending club, two mogul and others. and many, many unicorns, but netflix is unicorn made of pure platinum. the best of the best. my partner, mike shoe led the investment back in 1999 one of the earliest investments in the company. and since then, we've watched reed hastings do what he does. he's hired we think like an intergalactic level of a management team and built out an unbelievable business that we're proud of and happy for him and all the great people down there. >> when was your exit? and what did you see that made you want to exit? >> well, i mean we're an early-stage venture firm so we invest early in companies cycle and as the company goes out and

goes public. we gradually distribute our stock out to our investors and that's what we did in the case of netflix. so we no longer hold shares in the company. but as you stated, at one point we owned over 10% of the company. >> what is the long-term potential for netflix the way you see it? you saw from early on, what reed hastings had in mind, the direction the company was going in. from here it seals it's gotten so big with streaming and original content. some might strain to imagine how much bigger they can get. where do they go from here? >> i think that's an excellent question and i have that conversation and dialogue with people all the time. think about it this way. when mark zuckerberg came to market with facebook some years back, the concept of a billion consumers online, consuming content was beyond people's belief. now think about a company like a netflix. think about a company that will have potentially a billion consumers that are subscribing to digital entertainment content. and then consuming that on a

basis of like what we see today. and that's absolutely possible. that's the kind of thing in the runway over time. >> you know it's fascinating to hear you talk about the company like that, paul. because there's also the anecdote from about two decades ago when hastings tried to sell netflix to blockbuster of all companies and now they're trying to set themselves up to qualify potentially for an academy award. how high can netflix' ambitions in this current iteration go? >> i think one of the things that makes netflix an unlimited potential company is if go back to the management team and look at what reed has built there. people like neil hunt, the chief product officer who has won multiple emmys by the way. the focus around talent. patty mccord. the chief talent officer and talented executives that have been there over the years and are there now. reed's focus on building the world's best management team to go after this market opportunity is what allows the unlimited

opportunity to reveal itself. and it's a lessen that we push on entrepreneurs all the time we still fund dozens of companies a year. we point to the example that reed has set. in aiming very, very high and creating an iconic company. >> yeah, you mentioned chagg and some of the other holdings, it's been a while since we asked someone in your business about valuations, do you feel good about them or not? >> i think we're really seeing kind of a, a tale of two cities around valuations, if you look at most of the public valuations, they're fairly justifiable. i'm a veteran of the 1999 time period. i was actually executive in a company that got to a $9 billion market cap. $14 million in trailing quarter revenue. i know what it's like to see companies that have inflated valuations based on their revenue and multiples. i don't think we're seeing quite as much of that in the public markets today. in the private markets it's a different question. what we're seeing is upstream sources of the money large,

sources of capital. endowment funds, pension funds and so forth. coming down directly into some of the later-stage investments, we haven't seen this kind of phenomenon, really in the history of the silicon valley at the scale we're seeing it today. we're rewriting history. we don't know where it will be. we have to check back and look back on the private investments and see if they're justified in terms of valuations. >> check back in a couple of years or cover it minute by minute as we do here. paul, you got to come back. >> any time you want, guys, it's awesome. >> paul holland, general partner with foundation capital. thank you. up next, add amazon to the list of major tech companies under investigation by the european union, we'll tell you why in just a moment.

why is the world's biggest actively managed bond fund cutting its exposure to treasuries in a major way? we're go to ask c i/o of pimco, scott mather. plus someone who says there's $3 trillion worth of trouble in the markets that every investor should take note of. plus nike winning the nba deal. which sports apparel company has the competitive edge? carl will discuss in 15. let's get to the cme group, rick santelli with the santelli exchange today. before we get into the meat of what i want to talk about today,

atlanta fed updated gdp now. come to the board. on june 1st, it was up .8. on the 3rd, it was revised 1.1. today it moved up to 1.9. just shy of 2%. let's consider we are in the last part of the second quarter. june is it. and we've already had employment. we've already had retail sales. we've had a lot of the big data points, how many big data points are left? this seems to be a pretty accurate read as of late. i know it's not that old. but i think that's significant. now, let's stick with the theme and go to the data. i notice something strange at 8:30 eastern -- unlike employment, unlike the last couple of weeks where the sensitivity of the treasury rates to the upside seemed to be about hey, surprise me, give me some better data. well today, retail sales wasn't bad. as a matter of fact, you know i

try to be objective with everything, with the market. nonseasonally adjusted. like to look at nonseasonally adjusted data and with retail sales it was even better than the seasonally adjusted data. so no matter how you slice it. but yet what happened? we never really went hot. guns hot on treasuries. meaning moving in a new areas, which really would underscore what we've now referenced here, thanks to charles beaderman and our talk today about flows. kind of the margin market. treasuries are kind of the margin market. we could look at all the different players, if you look at what's truly tradeable and at market risk on any given move, it's probably 90% margin according to charles, i would agree with that. which means you don't have a lot of slippage. if you're pretty much leveraged everywhere and the market goes against you and going against obviously there's equal number of buyers and sellers, the emotional trade is definitely higher rates down price. when it comes to data there's the macro and the micro.

and i think that from a micro standpoint, it's all about the fed. meaning we look at things like unemployment and we immediately as investors and traders and people that monitor the markets like me, we try to look at it through the lens of what would happen. or does this change or bring the fed closer or farther. in the macro and this is key, even though we're less close do recession globally, we're still not really flying high in terms of our trajectory. that will keep a lid on it. i think the reason we vacillate with the data points, yesterday a big day in stocks. take nasdaq away, it's mostly momentum. we're basically unchanged, historic highs about the same. you look at everything through the lens of stocks, hence everybody is a bit more optimistic today. jon fortt. back to you. we've talked about apple music from an investor perspective. now from a user perspective. but what do top recording artists think about the streaming artists, we asked

grammy award-winning singer colbie caillat next. ♪ ♪ at chase, we celebrate small businesses every day through programs like mission main street grants. last years' grant recipients are achieving amazing things. carving a name for myself and creating local jobs. creating more programs for these little bookworms. bringing a taste of louisiana to the world. at chase, we're proud to support our grant recipients, and small businesses like yours. so you can take the next big step.

apple helped revolutionize the micic industry with its ipod and itunes store and it's targeting the music business, launching am music. it's new streaming service, which takes aim at big-name competitors like spotify and pandora. the record industry is cautiously optimistic that apple can give the industry another

much-needed boost. we caught up with two-time grammy award-winning singer/songwriter colbie caillat, who said she's watching the growth of streaming closely. >> it's very interesting. i'm, i'm curious to see where it's going to go. i think that it is a cool and unique thing, opportunity for, for music to have. but i also love buying music. i love having the songs whenever i want to listen to them on the plane and car rides, wherever i am. to be able to have the moment with the music i like. i think that's something i'm always going to be used to doing and love doing. i'm interested in seeing where the streaming goes. >> even though, caillat says artists like herself are cautious to embrace streaming, especially when it comes to fair compensation for their work. >> it's hard in the music industry to break out and there's all this, these different formats and competitions that people have to

really like go through hurdles to get their music heard. and their artistry recognized makes people have to branch out and think bigger, think harder and really try a new way of getting people to hear what they're coming up with. >> i think it's a concern for everyone. you know, you create your music and you put it out there and then it's not, it doesn't seem to be as appreciated as other things that people choose to spend their money on. we're all trying to figure out how to make it work and still get to do what we do, what we love to do is is put the music out there, but in a fair way. >> some concerns, but largely caillat seems willing to imbrace this new direction that the industry is going. and jon, she has always been willing to embrace technology to a certain degree. she got her start on myspace, she put herself out there on various platforms.

>> after getting rejected by "american idol" twice. didn't even make air. it's interesting. i'm uncomfortable with some of the things about the direction that music is going. fusion has an interesting piece this week about how little songwriters are getting in term of a slice of the pie in the, in the streaming era. it's like all music is turning into muzak. people expect it to be in the background. somebody else, an algorithm or person is picking the tunes. i feel like if i really like an artist, i want to buy their album and have the money go to them. or at least their song, if not their album. >> the writing thing has been a longstanding problem in the royalty business. i thought it was interesting spotify trying to make a point, saying look we've paid $3 billion to artists. in royalties over the years. >> and it is responsible for the lion's share of royalties that are being paid. i loved carl when you asked spotify's ceo, daniel ek, is this the end? is streaming where it ends? and he said, i hope so.

>> unless they send it intravenously. i'm not sure what else there is after streaming. when we come back, amazon under investigation in europe. we'll get some details on that in a moment. 25

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. just keep it, let go, let go. >> ah! i'm okay. >> that was me, getting a taste of the extreme sport kiteboarding, one of the other extreme sports we tried out for a new documentary that premieres next week on cnbc, a week from today. "the new high" extreme sports premieres june 18th, 10:00 p.m. eastern. we had an idea to look through how money is moving into sports that traditionally have not been big sports. obstacle course racing, wingsuit base jumping as this generation that grew up with x games and surf, various snowboards for instance, marathoning and 5ks are not enough. >> how did you narrow down the plethora of extreme sports there are to the ones you wanted to if he cuss on. >> follow the money. follow the sponsorships. spartan racing is one of the sports we've looked at. they've got reebok, panasonic,

nbc sports. they're still niche relative to the giant sports leagues, the nfl, but they're making their move. >> in the meantime, european officials opening an antitrust investigation into amazon's business practices. related to the distribution of e-books. the commission will investigate contracts that publishers have with amazon. requiring them to disclose more favorable terms offered by competitors. this isn't the european commission's first investigation into the big tech. they recently probed google's online shopping searches and had a big antitrust case with microsoft in 2009. if you're big, in tech and american, good luck. >> yes, even in america, apple is as we said on squawk alley, was likely to get investigated over apple music. any time they've got such influence in one area and are branching off into something else, they'll get looked at. >> e-books, this is a topic that has been investigated here in the u.s. apple's e-books case, launched

by the doj currently under appeal. that's a place where pricing has been under scrutiny for a while. >> and we'll keep an eye after amazon's annual meeting yesterday. meantime. dow managing to hang on to half the gains we saw at the highs, let's get over to headquarters, scott wopner and the half. ♪ ♪ carl, thanks so much. welcome to the haim show. let's meet the starting lineup. josh brown is with us along with the najarian brother, jon and pete. our game plan looks like this. the fear strayed, the strategist who says $3 trillion worth of trouble is looming in one part of the market and why investors should take cover now. competitive edge, nike, adidas, under armor in a cut-throat battle for your closet. who is winning? this year's stock performance might surprise you. stocks rising again today, off the highs. but there was better retail news, giving investors some confen