>> i've never solved one. there must be some trick to do it that fast. >> i'll bet there's some sort of instructional. >> just leave it the way you bought it. >> look at the dexterity. that's unbelievable. >> not even breaking a suite.weat. >> thank you for being here. "squawk on the street" begins right now. >> good monday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer and jim faber. the peak of earnings season arrives this week, everything from amazon to apple, ibm to gm. s&p is four points below the record close. we're around 2.37 or so. oil is key after dipping below 50 for the first time since april. road map begins with morgan

stanley. >> gold falls to a five-year low while the dollar hits a three-month high, we'll look at the drivers behind the moves and the impact. >> and e-bay and papal begin trading as independent companies today. we'll talk with the e bay ceo later on. first up morgan stanley better second quarter results. a strong performance in the brokerage business. long lines in greece over night as the banks reopen after about three weeks. some capital controls. you can access your safety deposit box. you cannot cash a check. you can deposit and there are limits on the number of euros you can take out. morgan stanley, trading is the story this time after wealth management has been the story there. >> let's compare this.

for fixed income morguen stanley had a gain of 30%. jpmorgan minus 10. for equities plus 28. goldman plus 24. citi minus 1. some people are saying the liquid ratios aren't enough. that was the wrap on the story about why it was up 41.5 and then people turned it down. this has been a phenomenon of this quarter. initially the stocks jump and guys peppered the bid down and real buyers come in. it was a great quarter by gorm gorman. the numbers will go up. others who are smarter will buy it. >> we focus a lot on the different path that morgan stanley chose to take after the financial crisis. morgan stanley with the huge acquisition moving securely into wealth management which people are happy to award a nice multiple to. a steady stream but this quarter

back to trading and their success where goldman didn't seem to have quite as much. . >> goldman didn't. it's almost like they're a quarter behind everyone plus they had the legal risk. morgan stanley got out of the legal game. everybody who faced down the justice department lost. it was justice department about five and banks zero. it was a bad -- it was just -- >> maybe even negative. >> the banks had the same record as the phillies. >> on the five-year anniversary of dodd frank today. a lot of retrospectives saying anyone who doesn't agree with the regulation probably thinks the world is flat. roi 9.1. >> that's going to be the story. i have to tell you that i think that if you're not patient with morgan stanley, you're kind of crazy because this model is working. a lot of the models are interesting. the morgan stanley model being a

no-risk model, i love. i love because they're the baby boomers looking for help. morgan stanley is that place. they have a great retail network. a lot of people have fore saken this kind of customer. morgan stanley embraces them. >> you have to keep all the brokers happy to a certain extent. >> you do. >> they hold back 15% of comp now. they do even more from the bankers but there's always that risk that teams will start to leave if they're not happy. they deal with that at every one of these big firms but it is not a risk that should go unnoticed. >> no but the stock has run up in operation because all the other banks have run up. i wouldn't be surprised if it runs up and then is back. >> first quarter after ruth porat after we spoke of her in every other segment. it was ruth porat day on friday.

>> and she learned her lifetime compensation at google in one day. >> they paid for her in one day. >> and it wasn't enough. i listened to that call and said what company is this? where were the driverless space engines? i never once heard -- did you hear about them going to driving through the core of the earth to reach china? >> no. >> it was the first time they're not trying to put a man through to china, and it was excellent. >> or the mission to pluto that took place. >> it was done. porat, the conference call it's sad. i'm not kidding. i don't want to go there but it sounded like other conference calls in publicly traded companies. at no point did it deviate to something something. it was about the numbers. >> in the meantime gold this morning falling to a five-year low after a wave of selling in

asia on news that china reserves are up 60% from '09 as the precious metal falls, the dollar hit a three-month high. new support mining we hit 10.87. they're calling it a mini flash crash in gold. >> i think wealthy people have to wake up and recognize that it should be part of your portfolio and you're getting a choonsance to do that. i'm not calling the bottom on gold. the gold stocks those companies have finding costs. they're fining costs are so miserable. every time they find a nugget, it's like we won't lose money on this but the gld is an interesting thing. if you decided there's going to be hyper inflation because -- we hear a lot of people talk. i was listening to people talk about hyper inflation. if you believe that gold holds the value, and mansions hold their value. those hold their value.

you probably want to look at gold if you're extremely wealthy. >> asking this morning, isn't gold telling a story? >> i think gold is telling the dollar is strong and that china is not that sprang. indian wedding season coming up. maybe want to get ahead of that. i think gold is going lower. i think people who are trying to diversify are getting a chance to buy something that was an insurance. all of us own insurance. all of us hope it doesn't pay off. if you have no money, be in an index fund. if you have some money, maybe you build a gold position because you think that eventually hyper inflation could occur because all the economies around the world printed too much money. it's a hedge. it's not auto insurance. it's more like collision insurance. like when you sign the contract.

>> you do that? you don't do that when you rent a car, do you? >> i have to admit, i'm super stishs. i take that. >> you get it with your am ex. and the company car too. >> like 7 concern--. >> i guess you can drive like a bad out of hell then. >> i sign it because i say this would be the time. >> i go out the same doors i go in. i'm superstitious. >> this morning an old place where there's nothing but auto stock. >> google stock that planned out the self-driving car with no one in it i never thought that would add value. >> you're going to pull up uber and a car is going to pull up without a driver. >> what about the drones? >> i don't know that they had actual manual driven drones. i think the whole idea of a drone is that it's not supposed to have a drone in it. >> how about porat?

i'm so amazed by it. she talked about things like -- she hit it on return of capital. >> she did. >> gorman taught her. >> i don't know. >> the process of making money. >> she was there a long time. >> how could she have changed the culture so quickly? she changed the conference call. >> sometimes that's enough. we'll get into the tax implications of the dividend. that's a big debate. e-bay and pay ball begin trading as independent companies today. papal will now have a market tap of about $44 billion. e bay about $35 billion. >> earnings per share, the numbers were interesting. everyone is looking at 2016 numbers. the guy i trust, i always hype robert peck because he's been so right about everything. he's using 1 .47.

i'm thinking $1.50. i think you can give it north of a 30 multiple. it's valued versus visa with a fun company, mastercard. i'm ahead of everybody else. some want to sell. that's wrong. i don't care about the regular e-bay business. i think papal is going to be the must own for the growth funds. stock goes higher than even has today, i'm shocked the thing wasn't up more last week. people don't know when to trade. >> we'll get a sense of where things trade today when they begin. always worth taking loo a look at history. 2002 it was a good deal, that's not bad in 13 years. that comes back to a decent compounded annual growth rate. a good deal for e-bay. unlike the skype deal which did not work out for e-bay but this one did. you may remember the back and

forth, carl i kahnecahn comes in and says split the company. they don't. and the former ceo of e-bay, his decision to just step down and say, i don't want to be ceo of either one of these companies. don't see that very often. i can remember the interview i did -- >> is there a plaque or a monument to him? there's nothing. >> and they reversed themselves. it did not look great. he came out and defended it and said the board went through its decision and made the decision when i came along, we revisited it as we did every year and they made a different decision. here's the result of that. one question that comes up a lot is either or both take over? alibaba comes up a lot. jack ma made it clear that's not where they're going. >> i think papal is the

millennial credit card. they'll talk a big game. the stock will go up a buck. $1.78 when they report and at the end of the day, flat. when can it be bought? american express should buy it. they won't but they should. they should also send me a check. there's probably a guy -- for the costco fiasco? >> yes. they will say we don't need to buy papal. that's always been the refrain. our company is doing so well. as the stock goes down. don't pay attention to the stock. it's the company that matters. i'm from the other school. >> which school? >> i like to win. a w is an w, and an l is an l. but i'm traditional. >> is there a different school? we're not aware of another. >> the american express school. >> is that no longer? >> people don't have to leave home without papal because it's

in their cell phone, but you can leave home without american express. the late carl molden would be rolling in his grave if he knew you could leave home without our american express. >> google adding to the market cap on friday. we'll get to that. also had an exclusive with the ceo of e bay has the company completes the spin off of papal and begins trading as an independent company. s&p only needs four points to set a record today. td ameritrade, they work hard. wow, that was random. random? no it's all about understanding patterns like the mail guy at 3:12 every day or jerry, getting dumped every third tuesday. this happens every third tuesday. we have pattern recognition technology on any chart, plus over 300 customizable studies to help you anticipate potential price movement.

there's no way to predict that. for all the confidence you need. td ameritrade. you got this.

what a day for google. what a week for internet stocks. google closed up 16%, an all time high and netflix is up. and youtube publishing some met tricks tricks last night saying the number of advertisers on the platform is up 40% in the last year. spending up 60% from the last year. they say for ten years they were in what they called hurry up and wait mode waiting for the

advertisers to get the picture, and then it was a sudden boom in one year their words. >> really why i'm, and i'm being a little facetious, but if you go over the line by line quarter and look at analysis porat is saying this has been going on. the company never talked about it. it didn't just start this quarter. it was like amazon services where they broke it out. >> we don't know what base they're off of. my sense is they're talking about growing off of what is still a small base after ten years. some of the comparisons i was hearing not that long ago, one syndicated tv show has as much advertising in an hour as youtube would in a 24-hour period. i'm not quite sure they're doing as well as they had hoped they would be doing or as the targets had them doing. they're not quite up where they had hoped to be i think, but

they are starting to highlight the fact that things are moving in the right direction. i wouldn't get carried away. >> no but they should have bid for that one game for the nfl. the nfl is waiting and fox and all parent companies all waiting for google to bid for the international games that are happening. i think google is going to bid for the international slate. this is the fear. google with write a check to the nfl and have every game that's done internationally. the rights are still free. i think anyone who has ever used google for an advertising campaign, let me show you how not to pour a margarita, your sales go up and you don't even pay anything. everybody else you have to pay. google is free for many small businesses. i think you're going to start monetizing that and i think that's another reason why the stock can go higher. >> one made the point last week the brewer due only between

facebook and youtube, you don't tend to watch long term video for facebook. you'll watch a documentary on youtube. >> google is i think google, youtube youtube, all of us use it and are surprised at how it doesn't cost us anything versus verizon data when you go to mexico. there's a disconnect. one of the things that happened with google they always told you offline, we have so many opportunities we can't even get to them. i think porat said we're getting to them. we're going to make money with our opportunities and it was a wakeup call to google who said one day we'll get to it. i do not want to be a major network and google comes in and writes the check for the nfl. >> and as you said i think a lot of the move that $65 agrecian in value was due to her value about what we are now watching our expenses.

when i've spoken to people who own the stack, that's the key move. pricing was still down 5%. it's hard to find good growth stories. this is one of them. particularly in liquidity. that's always important and that helps a lot. but the talk on costs really seemed to have motivated a lot of buyers. >> yes. the multiple gone well down below the s&p's average stock, mobile versus a cereal company and the other thing to keep in mind, when she did the numbers and looked at it it's clear they have so much money overseas, they can find any way to get it back. they can do something. >> the cash balance is more domestic than some others. >> they have a lot of flexibility to do things. and david is right about the opportunities of what she could do. i mean wow. she's a smart lady. >> we'll get cramer's mad dash

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>> that was her. she is monetizable. >> you are the most powerful man certainly in the mad dash. >> is that true? i'm one of two of the most powerful men in mad dash. i'm beginning to recover from delivering alpha. it was a major undertaking and you ran it. you delivered so much more alpha than everyone else delivered

alpha. >> i wonder if our panelists are going to deliver alpha. >> you are the alpha male. let's talk about amazon. here's what's interesting. i know you're mr. amazon because of that documentary. web bush says the future is fabulous. raises the price target. one says this is going to be the beginning of when they start selling a lot of apparel. david, they're using tam, total adjustable market. they say cloud bids understated. we saw this with netflix. we saw three powerful upgrades ahead and yet, netflix still went up big. i wonder whether this is going to be a breakout. david, remember when people used to short amazon and netflix? what happened to those people? >> they're probably hiding for cover or they learned their lesson. very difficult to do that. to be fair there were periods where amazon missed and suffered

after a quarter where there it is again, big losses, can they ever get the traction? does the business work? all the questions people ask. >> people say more cloud breakout is going to be terrific. >> 40 million prime members, though? >> i mean prime, although we had the articles today about this new outfit the top of the market. give me a break. >> the journal. it's an interesting story on them. >> there was a considerable short base that went into the market when china was falling apart. now that china has had a couple of days of not falling apart, a lot of short stocks are scramble. these stocks amazon fang is what i used to call them. that's facebook amazon netflix, google. fang is back. super sales. white fang?

>> huh? i'm not sure what happened there. i'm going to find out during the break. back after this.

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>> you're watching "squawk on the street" live from the financial capital of the world. we'll get the opening bell on this monday in about 60 seconds. busy week for earnings. 118 s&p companies are going to report this week alone. 12 dow companies. thursday is the busiest day of the entire earnings season. we have the greek banks reopening and the process of paying back the ecb and imf underway. >> i was going through the quarter to talk about a game plan for mad money for the week, and this is the week where people have to understand that analysts come home. they don't just read the concerns conference calls. they listen. four weeks a year you cannot sleep. it's mostly a five-hour energy thing.

i'm able to last 92 straight days. this is that week. >> you produce it internally. >> i have that enzyme. >> yes, you do. >> that's the opening bell. a look at the s&p at the bottom of the screen. it's lincoln financial celebrating it's 110th anniversary. >> in honor of the super bowl. that's an insight. >> over@ at the nasdaq papal. we'll be talking about it all week. a lot of people trying to make the argument after google and netflix next week we're in an atmosphere of thinning leadership. is that fair? >> this is a real issue with finding accelerated revenue growth. it's not around. no so the companies that have it, the money is being funneled to them. we have a lot of companies that are going to be hurt by the strong dollar. a lot of companies that are

being hurt by the fed going to raise interest rates. this boutique group of stocks get a lot more attention. we just don't have a lot of growth stuff. >> it's not the sign of an aging bull market? >> it's a sign that when they raise rates, a lot of people have to unwind, different strategyies strategies. where they're short to ten year and they have to unwind that if the fed decides to raise rates. they have to cut numbers. watch i bibbm. they'll give you the number. it'll show how hard you're hurt. then also china. a lot of these companies didn't include the july crash. people are going to start extrapolateing that. you sit back and say who has great growth who has no china and a lot of things going for them. you come up with google. >> ibm reports after the close today. we may be talking about it tomorrow morning. we'll see how things look for that company. >> they have to continue to show

an acceleration in their faster growth cloud analytics. this is the old -- they don't call it artificial intention. >> she has her own road nap. she abandoned the old road map in terms of the growth of the businesses and what they will represent as a total overall revenues. >> when you spoke with her last time, i think she pretty much laid out and said it's my company so, therefore, the ownership of the quarter is not the previous regime. the stakes are high. >> hasbro is an all time high. preschool up 14. boys up 1 .4. eve within girls down 22 we talked last week about the divergence when hasbro and mattel. >> these things happen slowly but they happen. >> remember when you killed the boeg us story about the hasbro

lbl? >> yes, years ago. >> they should have done it. they could have brought it public. i think you killed the deal. >> it wasn't true. it had the added benefit of being something that wasn't accurate to the extend it was taken at the time. >> it would have made sense. listening to them this morning, are doing everything right. >> more than $1 billion larger than mattel and mattel was far larger than hasbro not that long ago. >> do you play hasbro games with your kids? >> i think so. >> playdo. my little pony. >> he's more into the toy things. >> my kids are teaching me chess. i know it but i'm saying the video game revolution is very alive. that's why electronics arts is --

>> we play a lot of clue. >> they don't have a name thankfully. >> from has which is the best gainer, the second best gainer is hal, halliburton. 15-cent beat even with north american revenue down. >> it was a thing of beauty, i thought it was going to be the only one, and this halliburton quarter was magnificent. it is so funny that the oil goes down every day and people love these stocks. they also talk about the divestitures. you have the oil going up and the oil companies are dripping down. it's usually been they traded in sync. this is a great diversion. >> one thing not going up is the pipeline companies. you and i have talked about it. et is now going to be talking to

williams. there's no standstill. but the problem fe for ete is the stock keeps going down. that's hard to combat in terms of trying to have a potential candidate and your offer is all stock. >> kinder has also not been doing well. >> none of them have been. >> i think there's a perception that we're just not pumping enough. there were a lot of pipelines on the drawing board that won't be needed. the natural gas pipelines will be needed. that's part of the problem with coal in our country and there's also a pipe needed to mexico. they're in an import situation. they used to be a great exporter. gasoline being exported. natural gas being exported but oil, when you can't move oil, you're not allowed to move it outside the country. what's happened is there's been -- we need a consolidation. there's too many pipelines. >> right we saw a deal last

week where the stock went way down. there's a question of whether the ceo took a deal that was beneficial for tax purposes. >> natural gas is quite a market even though it's low. the demand for natural gas has been soaring because of the fall apart of coal. it's a great untold story. this weekend there was a piece, finally about how coal, 80,000 people, probably many going to be out of work. >> right. >> we thought of you on friday. ksu getting some follow through again today. i mean you talk about halliburton and some of the rails, the bar was set so low. you could have crawled over it. >> i think when you look at the rails, i didn't think a lot of them has put the high single digit decline in coal. ksu has a remarkable line to mexico. that's how you get the cars up here.

that's the cheap place to make cars. >> on friday ge weighed in with a solid quarter. the industrial business is showing some momentum. >> they have organic great in honey well. >> and ge capital continues at a pace faster than anticipated than when first announced. stock down almost 1% today. >> i don't know what to say. >> you know what's 2 from an all time high? under armour who has receive curry, jordan spieth. nobody is picking athletes better than kevin plank. >> and nike gets an all time high. they're also on fire. under armor the great junior growth stock of the time. there's room for everybody. these companies are -- what are you laughing about? >> people are insulting me on my

twitter feed because they didn't understand the soupy reference. >> if we had a trend, that would be it. >> what can i tell you. one guy said i went to yale and i'm an idiot. how can you face your public and not know soupy sales? >> i didn't give you that big kiss that he always give after white fang and black tooth. >> thanks to the beauty of youtube, i'm on top of it now. >> our executive producer noticed that soupy sales. >> no one is quicker than the internet -- with internet searches than him. >> we have a new record in the nasdaq. bob is on the floor. >> reporter: good morning. happy monday. mixed open. polyis at 50. emergency is down. financial and tech is leading. i want to focus on tech. weird stuff is going on in tech. a lot of chatter with traders over the weekend.

you mentioned nasdaq at a new high. nasdaq 100 at a new high. a great month. nasdaq 100 is up 6%. i want to concentrate on how weird. on friday new highs on the nasdaq, but three to two declining in advancing stocks. the leadership is getting narrow and it's down to about four stocks. technology is the biggest sector in the s&p. the weightings here matter a lot. i want to show you the big four and why things are getting distorted. google, amazon, facebook and apple. look at the numbers. three weeks, google is up 29%. apple up 2%. the reason this matters is they're 20% of weighting in the technology stocks. look at the market capitalization of these stocks. apple is $70 billion.

google is $400 billion. add it up. $1.7 trillion. the nasdaq 100 has a cap. those four stocks are 30% of the nasdaq 100 right now. and it wasn't that bad just a couple of months ago. that's why the nasdaq 100 is blowing everybody out of the water. it's up 6% on the month and it's attracting everybody's attention. this is very dangerous to have four stocks that are really moving all of these indices around. we asked your partners how weird is this? it's unusual. right now it's only happened nine times since 1980 that the nasdaq 100 is three standard deviations from the 50-day moving average. this almost never happens. 99% of the time you stay below a three standard deviations. eight of nine times we've been lower in the next week. very rarely do you see this move up rapidly in the nasdaq 100.

normally it's lower. i believe three of the four are up. google is down a little bit. as you see down 2.5% but not surprising given the amazing move up. keep an eye on these very dangerous divergences that have been going on with the indices. they are normally not healthy. those are the four you want to watch. in the meantime gold down. five-year lows. the gld had a lot of action last week. spider gold trusts and that's reflecting the five-year low. more importantly, a huge volume in the gdx. that's the gold stocks index, and also is sitting near a five-year low right now. finally, i want to mention the greek index. the greek stocks do trade here at the new york stock exchange. modest moves reflecting the modest day we're having over in europe. guys? back to you. >> thank you very much. let's get to the bond pits and check in with rick santelli in chicago. >> reporter: good morning, carl.

it's an interesting session about an hour before treasuries open. we did see yields move up a bit rather quickly. if you look at a 24 -hour chart of our tens, maybe as important is the length at the hip movement that we get with bunds, both the moves occurred right around the same time. you see bund yields. it's a scaling issue. the spread between the two remains at 150s and until it changes look for the markets to highly correlate on the yield moves. if we look at the spreads, a lot of talk. is it a signal? sit giving us a clue about the sfed? possibly. signals are hard to read because there's a lot of outside forces affecting our markets and all global markets. fives to 30s. no we started out in july it's all about flattening which may be fed closer. but if you really started year to date, you can see for most of the year it was about steepening. with f we look at the dax and i

threw this in there last minute look at that chart month to date and realize we're a couple and a half weeks through july. really, it's hard to look at that chart and say there was a lot of things going on over all the greek issues. it's been a moon shot. euro versus the dollar we talked about it for weeks and weeks. under 1.10. this should have some follow through and it did as you see the 1.08 handle on the chart. we zoom through 97. it's a little mesier in the euro but you can see also nice break out there. carl, back to you. >> all right. we'll talk to you in a minute. rick santelli in chicago. when we come back biotech company horizon pharma. the stock is up. the ceo is going to join us next and later in squawk alley, an exclusive with the ceo of e-bay as the company officially begins trading as a company without

papal. record highs on the nasdaq. we're back in a moment. are you moving forward fast enough? everywhere you look, it strategy is now business strategy. and a partnership with hp can help you accelerate down a path created by people, technology and ideas. to move your company from what it is now... to what it needs to become.

>> sharings of horizon pharma are up. joining us is the ceo. you might know timothy because he's been a frequent guest on mad money. how many of these new drugs, the ones that you just acquired are responsible for this up side? >> well, jim, it's a combination of our base business continuing to accelerate and the high peern transaction integrated fully within a few weeks and adding new patients. >> i think people don't understand when you get a drug a lot of people have given up on or didn't know how to sell it out, you have a unique method that involves doctors not being to reject and health care companies not being able to reject reject. can you explain how you're trying to revolutionize things.

>> what we do is it's all about creating access for paints for getting to the lowest out of pocket cost for them and minimizing the rejections in managed care so we provide a patient free drugs who get denied access. >> one thing i'm curious about is i read about acquisitions and after a company is acquired the acquirer raises the price on the drug 40 %. is that a sustainable practice? how does that make sense if you're not changing the drug? >> we look at pricing in a way of pricing in a way of what the market will bear. it's how we use the dollars. we bought a product, the list price went up. that gives us money to create access for patients. >> so that gives you money to create access for patients but does it also make access harder

because there's more push back in reimbursement? >> sometimes but ultimately we find the benefit of creating access for patients min miedsing the issues and hassles in an office where patients are rejected. as a result, the physicians write more prescriptions of our products. >> tell us also about the axis you are trying to make. they instituted this poiseon pill. >> it's a valid point. your stock is up. that would seem to help your pursuit here. what are you willing to do? they put the pill in. it's made it more difficult to call a meeting. are you willing to hold that meet. what have you heard on your side and theirs in terms of what they want to see happen? >> first, we believe this is a shareholder friendly proselposal. we heard from shareholders on

both sides that this is both strategic and financially compelling. that's why we went public with it. we've had a number of meetings over the past weeks with their shareholders and ours and they believe it makes sense in all ways and we're here to stick it out and make it happen. >> their management doesn't seem to agree. and those who advise the company seem to be willing to fight. what are you going to do? >> we're willing to exercise all tools to make the transaction happen but in the end, the shareholders who see likeçó our earnings today, significant results driving newly acquired products and the base business they'll see the deal makes sense and call their board and enforce them to engage because the deal makes sense for both sets of shareholders. >> this actimune is much bigger

than we thought. >> we love the acquisition. with the two base indications, we see it as a $200 million drug. we started a trial far neurologic disease. we expect to get data late next year. >> all right. this is big. congratulations in the mix of a major deal. that's timothy walbert. we've liked horizon pharma since mid teens. >> great to be on. >> markets relatively flat. don't go too far.

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it's time for cramer and stop trading. >> you heard it first on the incredible conference call that was run on honey well. nonresidential construction comeback. this is a huge hiring machine.

laa lii, this is another nonresidential construction company. this is the place to watch for this quarter. it's the strongest part of the economy, and it's been weak for a long time, and i think that people have to recognize that con nonresidential conduction is a driver of the company. >> new homes on friday. we just had our best month in six years and it was the first time that we got a third of the market for first-time home buyers. >> this is why i don't fear a rate hike. i don't fear it. nonresidential, auto residential yrg they're all strong. they're big hiring machines and they work versus the strong dollar which is going to get stronger when we raise rates? . >> and when you talk to some of the people they'll say we're

underbuilt for quite some time. it's finally starting to happen but they seem to be very happy, the likes of john gray who we talked to last week at delivering alpha. still very much e ma'amnamors of certain commercial markets. >> it's the great story to watch. we've needed that. that's been what's holding back a lot of the big industrials. it may not work out for europe. there's so much to be left on the table in terms of talking, a lot. >> we only give 60 minutes. it goes quick. >> and then apple. >> the number bumps. >> what's on mad tonight? >> i got a breakup of an american people. i'll reveal it and why the stock is undervalued. >> i know what it is. >> now do you know? >> i know because -- >> i know. >> i'll throw a pie in your face. >> i'm not going to tell anybody. >> he's got a pie coming at him tomorrow.

>> people are talking about things other than stocks sometimes. >> i had a big thing on lenox but i should have just talked about different characters. tomorrow i'm going to come with sherry lewis, another lamented departure, sherry. remember her? what were you watching growing up? >> hr puff and stuffs. >> watching pbs. holy cow. >> i was watching huntly and brinkley. >> we'll see you tonight, jim. more on morgan stanley after the break. don't go away.

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to understand pressures in and out of the classroom- some expect to cut dropout rates by twenty-five percent. ibm analytics is working to make education smarter every day. ♪ >> good monday morning. welcome back to "squawk on the street." i'm carl quintanilla with david faber and sara eisen and simon hobbs. it looks like we may want to take a bit of a breather. pretty muted data on the dow and the s&p. the nasdaq hit a record high.

keep your eye on crowd which dipped below 50 for the first time since april last week. >> let's get you the road map for the hour. gold hitting five-year lows. we'll talk about what triggered that and what comes next. >> and facebook inching closer to the $100 a share market. >> and an historic day in washington as the cuban embassy prepared to reopen for the first time in more than five decades. we'll take you there live as the cuban flag is raised. >> well this is the week for earnings. morgan stanley on day one beating estimates for both quarterly earnings and revenue. mary thompson joins us with the details. >> reporter: as you said the firm's trading arm helping to deliver the revenue beat in the second quarter. profits excludeing adjustments. a nickel better than expectations. revenue ahead of analyst east forecasts. and the ceo holding the first

conference call saying high activity in asia and a strong performance in the u.s. in trading equity revenue rose 28%. fixed income commodities and currencies up, stronger than many peers. below some analyst's estimates. only call someone calling the performance solid. and denying it's looking to expand the business they've looked to downsize over the years. >> the strategy is not changing. that doesn't mean we're not going to be more efficient providers, and it doesn't mean that we won't pick up share and it doesn't mean these markets as they continue to throw out relatively low volumes, there might be more chance on the revenue side. >> reporter: wealth management or the broke raj arm delivered improved 23%. loan growth was steady but retail clients remain hesitant

about increasing their trading activity. the comp ratio remains slightly above the firm's target of 55%. >> broader markets now off to a sluggish start today as the s&p and dow try to follow through. the nad daksdaq setting record highs. where should investors focus their entaengs.attention. mary just ran through the financials at morgan stanley capping off a pretty solid quarters for big banks. is the sector finally returning to health? >> i think the banks are one of the sleeper surprises over the next few years. just the same way technology and probably the two groups that we think that could outperform the market. it's good news.

>> you've liked technology, and certainly technology has been a stand out. google earnings but bob ran through interesting statistics but overall breadth in technology being negative. is it just the googles and netflix going well or is this a broad group? >> you know, i think the performance shoud broaden but as you know a lot of tech is cyclical. there's secular growth tech. i think the cycle oriented pieces are the areas that get signs of life as investment spending rises. it might take a while. >> like what? >> thinks like ibm, hp really are much more dependent on a broader base of spending by businesses and tech spend x medical has been flat flath for almost 15 years. >> we keep forecasting it will happen and it doesn't?

>> yes. we have been waiting and waiting. >> people say that and it -- >> i think part of it is the lack of inflation. i think we're finally -- this is the year where you can finally say wages are picking up. housing is picking up. the sense that we don't have to worry about inflation is ending. i think that gives people more confidence about spending. >> the it's a very divergent market in the areas that are now not performing energy again down during the course of the month and then you have big tech icons, big names that they people are prepared to drive the multiple higher. is the nature of the stock market and what the hedge funds will chase change it? >> i think simon, i was in the west coast last week. i think there's a real sense of confusion among large investors. the market hit new highs. people weren't excited. the macro got people cautious.

there's a bit of a chase going onto momentum names. i think we're in the middle of earnings so there's a tofocus on who beats. the bull market is still intact and i think the broadening will take place later. >> we just had this huge threat to the euro. we just had china halt half of its stocks and a couple days later sixvix is at 12. you'd rather see some sentiment change even a little. >> it shows you the crowd gets it wrong. maybe people were overworried last week. as we highlighted in a piece a couple of weeks ago, two weeks because probably the best buying opportunity since october. but as i look at the balance of the year i think there's a lot of tail winds. i think energy becomes a tail wind because energy earnings comps improve. we get the tail wind from lower

oil. >> we're seeing less of a head wind at least from the oil prices and the strong dollar during this quarter but the dollar is marching up and oil is going lower. maybe that might not last. >> it depends on what happens with the rig count in terms of how it affects energy and in terms of the dollar i think you're right. on a year over year basis, the dollar is going to base some tough comps because it's much stronger but it's flattening. >> we should probably mention where we are on the fed. is it september 17th that they have their september meeting? >> yes. >> presumably now that greece is not a macro economic problem for the future, that means the september rate rise is more likely? >> yeah. i haven't checked the markets expectations recently. >> it's still very low. >> i still think it's more of a december. >> yes, but given the the rhetoric we have fwlrks weather their september is more on the

table than it was this time last week. >> yes, eni would point out when you look at the history of fed cycles, the reason the fed tightens is often more important than the actual event. so if the fed is going to be tightening, let's say september is the meeting but it's because underlying conditions have improved enough, it's bullish for equities. i think that's the surprise for markets. whenever it takes place, we'll do better. >> isn't it also if you took a snapshot of where we are now, it might be how you ease monetary policy? >> you mean because -- >> because the data is relatively weak. >> i think you just have some biefr kags of data. i think we've seen improvement in house bug you're right. i think the fed is concerned about how any change in their stance will affect mortgage rates and housing which is really central to the consumer recovery. >> thank you. always good to check in with you on a monday morning. the dow down 15.

>> when we come back on this monday, google breaking records while facebook gets closer and closer to the 10 $0. how do you play these names, especially after last week. and an historic day in washington d.c. where the cuban flag is about to be raised in about a half century. we'll take you live from the embassy. more "squawk on the street" in just a minute.

welcome back to "squawk on the street." let's talk about fun and games with hasbro hitting a record high trading up over 5% at this point. currently the top performing stock in the s&p. the second quarter results beat estimates and hasbro benefits from boys preschool division. a nice day overall for hasbro. >> these have become intellectual property companies. google shares down this morning after soaring on friday with a positive earnings report creating one of the biggest market cap increases in history. amid the leap s&p capital iq

kept them to hold from a strong buy. we have a -- scott with us this morning. >> good morning. >> you go to a move on friday was it overdone? >> you mean the increase of 15 to 20% on friday in we think so. we put out an update after we raised our target price on friday. $715 we thought was reasonable and next thing you knew the stock was in the 700s, implying 2 % up side. at this point we thought a hold is more appropriate, and it does seem like a lot of people have forgotten about some of the notable risks we see related to google and that's something that people need to be mindful of as well especially after the gains this year. >> i wonder i mean i don't know what the short interest was like, but we talked about it doing so little for so long that it was almost like a coiled spring. i assume just her first quarter,

she could have said a number of things that could have caused a pop. >> it's interesting to note that there was a lot of negativity across and around wall street related to google. and i don't know that things have completely flipped at this point. people are optimistic about youtube and optimistic about mobile and optimistic about costs and expenses. people are optimistic. growth is going to be interesting as we look out a couple of years from now and think about a legal and regulatory perspective. we think the stock is fully valued. >> this sounds contrarian. most of your fellow analysts came out and raised their estimates finally starting to see cost discipline finally starting to see some of the positives working out including the numbers out of youtube.

why are you going against the grain, specifically i guess, on some of those issues, and i think the biggest argument for this company is the valuation of facebook, which is so much higher and the fact that google is also growing in these kinds of numbers. >> i think that's a fair point, sara. i was looking back and i was on your air at the beginning of the year and everyone was asking why is it that you're positive on google when everyone else is turning negative. i said then and i'll say now, we like the concept of buying nowlow and selling high. we have a buy opinion in the stock of facebook going into results next week. the way we're thinking about it is really if you look on the top line facebook has two to three times the growth that google does at this point, and we see a lot more levers for gains as a posed to google where it seems to be a cost containment story at this point. we really like the fundamental

story for facebook a lot more and people think it's a lot more highly valued than it is, frank l ly, in our opinion. today we have in the financial times the number of advertisers at google as risen more than 40 % in the past year. we're aware of the structural changes coming through. specifically on fax and what we can expect and i think people have spoken about stickiness. what can we expect when they report? >> when we think about facebook we think about a strong organic growth story and continuing investment in some of the kind of emerging opportunities whether you're thinking about video or you're looking at instagram. i think down the road you could see more monetization. if you look back the last couple of quarters facebook has traded down because they've had negative impacts from currency and they've been spending morevery

aggressively. i think people are thinking about facebook differently and see it as reasonably valued if you look at next year's earnings. it's where the revenue growth is expected to be, not the premium that a lot of people would have you believe, especially as the market capitalization that has increased. >> finally, some of those more positive on google than you are like to compare the multiple to facebook and say google has got to be worth at least half of a facebook. do you have a problem with that? >> that's interesting but considering the market capitalization right now and facebook is still really much much lower than what google is and facebook has much more growth, and we think has a lot more avenues to kind of continue and maintain that growth. google, we think, is going to be kind of a mid teens grower with a lot of regulatory overhang. until we see more details on what ruth porat is going to be

doing, we think the stock is fully valued especially after the 33% gain we've seen year to date. >> that regulatory overhang didn't get a lot of discussion on friday. that's a fair point. thanks for joining us. >> coming up on the show it's been an arresting 24 hours for gold. falling to a five-year low after a wave of selling in asia. and we're still awaiting history in the making. the raising of the cuban flag at the cuban embassy in d.c. we'll bring you that controversial move, next.

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gold under pressure dropping almost 4% overnight. we have the senior vice president at ambersino brothers. >> good morning. >> this was a big drop at the beginning of the asian suggesting. some were suggesting it was fundamentally driven. we got the data from china's central bank. what is your take on what's going on on a big move. >> on the big move i think it's relative to look at china's holdings. right now that's all they are is expectations. the news out of china that they're not holding as much gold, they probably won't be buying as much may have triggered some to exit the gold position. however, it's odd to say that after all that happened last

week when you look at the federal reserve and what happened with the iran deal and the greek bailout, all of that was gold negative but it trickled lower. we didn't see a big move and then on sunday morning in asia, a big move. it gets me thinking that someone was testing the waters and that while liquidity, it's key here it probably would have been better for someone to wait until new york opened. we got a $40 drop. half has been recouped. right now it's a wait and see. you have to wait and build a little bit of a base. we've made big strides in gold prices over the last 12 hours and to say that this is it or this has another 100 points to the downside it's too early to tell. if you see a major asset class which gold still is down at a five-year low, does history teach us that's a buying opportunity or do trades or

investments like this break? >> i think when it comes to history, we have to throw it out the door and look at where we are today. gold has been traded as a safety net, as a safings vehicle and also traded by fast money since the crisis and the whole currency devaluation of qe. i think in the big picture, we have to look at this. gold is going to find other suitors. people will see a buying opportunity but there are better opportunities out there. if the short-end yields are going up in the u.s. that's better, stocks in the u.s. looking at maybe bonds in europe having a little bit better bid to them given the bailout. i think right now gold is going to find a lot those looking for risk avert trades are going to go away from gold. what caused the overnight selloff, we can hammer out different opinions all day long but it happened and now we have to move forward and those still

long gold, they're waiting. do they want to add to their position or get out? i think you wait and see. this isn't a panic position. you want to watch and see how it trades. >> the move in gold was notable but we've seen a general trend of weakness in kwoidcommodities for a long time. we've been talking about crude oil dipping below $50 a barrel. is there something to worry about when it comes to the message from the commodities markets on global growth and deflationary concerns or is it about a stronger dollar? >> i think the strong dollar is only part of the argument here. i think when you take your largest buyer of world commodities and they decide they're going to pull back or cease buying all together and that would be china, this is just the tip of the iceberg. the if they're really in trouble over there and if they're going to stop buying and if their housing market starts to crumble and they start looking at expand

expanding their energy sources and if they stop buying gold and i think the commodity prices themselves, this is the beginning of what could be a greater selloff. you're talking about $30 a barrel oil, sub thousand dollar gold. those numbers are attainable with china is pulling back on the reigns. this is just the beginning. >> have a good week. nice to see you. >> thank you. >> freightstraight ahead, an historic day in washington. in moments, cuba will reopen its embassy in d.c. for the first time in years. we'll bring you that moment live as it happens. we'll be right back. of the mercedes-benz you've always wanted. but you better get here fast... yay, daddy's here! here you go, honey. thank you. ...because a good thing like this won't last forever.

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>> here is your news update at this four. a midday explosion rocked a turkish city near the southeastern boarder injuring 100 in what appears to be a suicide bomber. a senior government official saying they expected the islamic state group was behind the blast foreign ministers engorsing theen endorseing the iran nuclear deal. a and p filing for bankruptcy plans to sell off stores as it faces increasingly

tough competition. this marks the second time in five years the company has filed for bankruptcy. and the parent company of ashley madison, a match making website for cheating spouses was hacked. avid life media said it has taken down the hacker's post and has hired a firm to investigate the breaks. that's your update for this hour. back to you. >> all right. thank you. we have an historic moment about to happen in washington d.c. the cuban flag about to be raised above the cuban embassy. reopening full diplomatic relations for years. good morning, michelle. >> reporter: good morning. 1961 the embargo started under eisenhower and flushed out and

really became in full force under jfk in '62. we're waiting to see the whole event unfold here. there are hundreds of vips who have been invited. they're going to raise the flag at 10:33, exactly, i'm told. you are seeing hundreds of people on the sidewalks between protesters and camera crews and a line of dignitaries lined up ready outside to go inside for a reception that will measure roughly 150 people. to arrive at this moment so many things have had to change. we have seen the cold war rise and fall in the last five decades, and it was only after that that we begin to see this kind of change occur between these two countries. it also took a president who believed more in engagement than in isolation for this to happen

as we've seen it play out with cuba and iran. and inside we know there are a lot of american business people who are very eager to do business in cuba. provided the cuban government will let them. it's going to be a two-way street. even though there's a lot of easing that's happened in terms of what america can do the embargo is still in full force. and the american government has allowed investment. it's never totalled more than $6 billion over the last ten or 20 years according to those who have been able to get ahold of some of the figures, because the books of the cuben government are still to this day opaque. we don't know their gdp or outstanding debt. we don't understand what is their relationship financially with venezuela who provides, we

know used -- oil to the cuban government. behind me there are a small group of protesters to who are here to support the cuban government and i will say this. if this event had happened 20 or 30 years ago, we would have worried about violence in the street and fistfights and perhaps even bombings. it's a very dramatic shift relative to the relationship that we've seen in the last 20 or 30 years. >> it is 10:33, michelle and looking over the state department background briefing it does appear they're doing to do this on the havana side very carefully. would you agree? >> absolutely. and i would say that the way the state department has handled today has been as unceremonious as possible. the cuban flag that hangs in the lobby of the state department was put up at 4 a.m. they didn't want to do it during business hours. what's going to happen in

havana, a small plaque is going to be put up and the secretary of state will go later this summer, bebelieve mid august and that's when we'll see a flag raising. but today right now the cuban flag being hoisted in front of the cuban embassy here in washington d.c. >> and the way i understand it is this is largely symbolic. obviously it marks, as you said a historic shift in the u.s. relations, but as far as what comes next for business doesn't congress have to get involved here with some of these trade embargoes? >> for sure. the embargo cannot be lifted without, literally, an act of congress and then there's a lot of rules written into the law, things that have to change, presumably the castro brothers must be gone from cuba for the embargo to be lifted. and there are 5,911 claims of american businesses that filed claims back in the 60s when

castro seized all kinds of properties whether it was bank ranches, the coca-cola factory, et cetera, and the way the embargo law is written, those claims must be settled before it can be lifted. there's competing legislation on either side of this question at this point in congress and it's going to be the political story that plays out that's going to decide how this is going to go but there's money on both sides, very active trying to keep it strong or weaken it dramatically. right now as you can imagine, the predisposition of the president is for it to weaken dramatically dramatically. and there it is. there's cheers here from the street. ♪ >> reporter: that's the cuban national anthem.

>> reporter: there it is, guys. the cuban flag in front of the cuban embassy for the first time since 1961. >> michelle it's evident that there are protesters that are there.

many people will be quite angry around this country at the images they have just seen. can you touch on the anger and explain why still there suspect a pathway for the administration to get what they want through congress as things stand at the moment? >> reporter: well, i think it's because there are so many cuban exiles who lost a lot of property and lost their livelihood and country. a lot of them live in miami. they and their children the children are not quite as strident, but there were so many people besides the american companies that we told you about that lost everything, and fled to this country to escape communism and they feel that there should be some kind of change in cuba there should be democratic change and more human rights in cuba before this kind of event would be allowed here in the united states and for the

u.s. to restore diplomatic relations. it's a vein that runs very deep. it runs far less deep than it used to because many of the exiles have gotten quite old and are in their 90s and as that generation passes on their children are far less strident and feel that there should be some kind of change and many of them travel back and forth to cuba and bring back all kinds of foods, electronics. it's an incredible almost shipping system that happens. there's so many new products in cuba that are a result of the cuban exiles who live here. but they are very divided. and far less likely to be supportive of the reestablishment of dep lomatic relations. >> with some of the political simymbolism out of the way, it will be interesting to watch the flow of money into cuba as it relates to tourism and power generation. that's an important economic

story to watch over the next several months. michelle in washington cede as the flag is above the embassy for the first time in a half a century. when we come back the ceo of e-bay is going to join us for an exclusive interview. still a muted picture with the dow down about 5 points. don't go away. rprise and you can move the world. but to get from the old way to the new you'll need the right it infrastructure. from a partner who knows how to make your enterprise more agile, borderless and secure. hp helps business move on all the possibilities of today. and stay ready for everything that is still to come.

>> one of the stocks set to report this week could see a huge move on earnings but which one. we'll tell you on trading nation. more "squawk on the street" coming up.

gold is still down sharply right now after hitting five-year lows overnight. a dramatic move.

>> good morning. that's right. very heavy selling pressure. almost a $50 drop overnight and the question out there is where was the selling pressure coming from. there are a few theories out there on this. a stronger dollar that's battering all commodities. that is one piece of the story. another theory is that margin calls in the equity and commodity space were causing this sort of selling. we have recovered a little bit. let me put this in perspective for you. nearly 900,000 lots were traded. that's you can see the sense of scale there. a lot of people asking if the chinese are giving up on gold at this point. the theory is that maybe we're seeing a little bit of a rotation affect as we've gotten better data out of china and also as the market is recovering after the nose dive we saw recently. gold has not been getting a bid

of geo politics. that has been an issue for gold and if you're trading gold as an inflation hedge and you're going by the data janet yellen is looking at there's no inflation in the marketplace. that's another reason people might not want to be holding gold right now. the technicals are important in this trade. 1100, a key point. that's right where we're sitting. it is possible after a dive like this that we could see a technical rebound. need to watch the watch gold. back to you. >> let's get over to the kmcme group with rick santelli. >> reporter: let's stick with the gold commodity topic. i'd like to welcome brian west bury. >> good to be here. >> a couple of things. when i look up and see gold moving lower, i can't help thinking about other things like china and global demand, and

ishl ati remember at the beginning of this move it was all about is this about accumulation of commodities, is it about global demand, your thoughts? >> all those things come into play but gold was massively overvalued. look at oil to gold. it's about 16 barrels of gold to an ounce of gold over the last 30 years. $50 for a barrel of gold today. that gives you 800 for gold. we think gold is about $950? >> not that long ago we were at $100 in oil and much higher in gold. >> commodities always want to blame something else. but in reality, at the end, in my opinion, it comes down to those fundamentals. i'm an economist. that's what i look at. >> and you're a teacher sometimes. put on your teaching hat. i'm going to make a comment. tell me what's wrong or correct with it. >> boy, china might only be at

7% but with greece the united states australia, they would die for those growth rates. your thoughts? >> they would. china is growing rapidly. here's the key about china. it's not some magic. what they did is for 2,000 years they didn't use technology and then all of a sudden about 30 years ago they decided to put in cell phones, all the things that we invented the internet all this stuff. >> and compensate us in a favorable way. >> all that stuff, they're able to get this growth that away. in the end they're not a democracy. they don't believe in the reel true rule of law. i think that's going to hurt them. >> i believe social issues are the key. here's the bigger problem. to go to 6.5 from 10. that's about a 30% drop in growth. what who is going to make that up. ? what we're hoping. >> bedon'twe don't use the word hope.

>> thailand and asia. >> they are doing it? >> not completely but they are. they're filling it up. global market happens. >> this is my argument. it's a mugs game argument saying their growth has slowed 30 something percent over the last years but it's only about how much everybody contributes to one global economic number. >> and remember we're still four times bigger than they are. >> i get that. and the other thing is their economy is bigger. 6.5% is a bigger number than it would have been before. >> and growth from us makes up a loss for them. >> we only have a few seconds left. another reason i think gold could be getting hit, fed normalization. if they raise rates it's a negative carry. >> right. >> it costs more to hold the gold. >> it does. but it's also not tight. the economy would be doing well and gold is not a safe haven.

it hasn't been for six years. >> it isn't, but when i look at what's going on in the world, you thought gold could get down to 800. at 800, i don't think anybody can get crunched. >> that's the time to buy but wait. >> thank you very much. back to you. >> up next on the program, new york city is stepping up its battle against air b and b abusers. we'll talk to the woman at the front of the fight. and the ceo of e-bay will join us for an exclusive interview. "squawk on the street" will be right back.

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new york is double down on the pushback from some big cities against home rental sites like airbnb. the new york city council to actively investigate what it calls the conversion of residential units into illegal hotel rooms. councilmember helen rosenthal is a driving force behind the move from nyc and joins us here. good morning.

>> good morning. nice to see you. >> you obviously feel very strongly about this. >> well we're losing in my district alone on the upper west side over 600 units of affordable housing every single year. citywide it's tens of thousands of units of affordable housing. so that's the fundamental problem. now you've got airbnb whatever the other sites are, short-term rental platforms that come in and use an opportunity where people could monetize their homes to in fact have these illegal hotel units. it's a problem for two reasons. one, you're living in your home, your own residential building, and all of a sudden your neighbor is renting out their unit every couple of nights so you have people coming in with bagagesgage coming in through your

front door using your public space in the building and you don't know who they are. they're not your neighbors. number one, you have a quality of life problem. but, secondly what we have are unscrupulous landlords who are systematically harassing and evicting out of their homes tens of units, and then renting them out on airbnb. so there's where we see the loss of affordable housing. >> just to be quite clear, though, this is illegal hotel rooms. >> sure. >> just define that for the sake of this conversation what you're actually able and willing to fight for here. >> sure. so in 2010 the state passed a law that you're not allowed to rent out your home for fewer than 30 days. if you are a single family or a dual family homeowner and you have a free standing home you are allowed to do this. but if you're in a residential, multiple dwelling unit you're not. >> does a townhouse count as free standing dwelling?

>> townhouse, as long as it has no more than two families living there. >> i think there's an economy that's been created sort of in some of the up-and-coming neighborhoods, harlem for example, where lots of people rely on the income they get from airbnb now. >> look if they stay in their unit while the visitor is there, it's perfectly legal. the problem is when they rebt out their entire home. >> have you seen the de blasio tab on uber that now runs? there's a de blasio tab unrelated legislation, a proposal that he wants to pass on uber against uber. there's this perfection right now that new york city is fighting the innovation sharing economy. >> sure. it's two separate issues. really separate issues. i understand how they're connected in terms of you know, a website platform. but in the airbnb scenario currently and in our hearing in february airbnb refuses to act

against the illegal rentals of the units. so the attorney general, for example, found that two-thirds of the rentals on airbnb are illegal. flat-out illegal. if airbnb were willing to step up and, for example, weed out all of those rentals and truly -- >> you're fighting illegal activity. >> am i allowed to let my buddy from chicago crash at my place? >> absolutely. especially if you're there. >> how is it different from airbnb? >> you're not leaving and getting -- >> if i'm gone. if i leave town and, say, for two weeks david, you and your family, feel free. use the place as you like as you see fit. pay me $50 a day. >> okay. so if your board allows to you do that in your building perhaps you get a pass. most boards will not allow that to happen and, in fact people are finding that they're being

evicted out of their homes because their board doesn't like it. >> my question would be how effective you can be here. on the one hand if you were really i.t. savvy could you go on to airbnb and sort out instantly the city council there and shut them down. >> bingo. >> the other side of it is you've got 17 new inspectors on the figures you've got here that's one new inspector every 550 illegal rentings. you don't stand a chance with that sort of ratio. >> right. >> for them to continue doing what they're doing presumably. >> absolutely. so to date the office of special enforcement has been reactive body just in the way you're describing. sending out inspectors when there's a violation, issuing a violation, not really getting us anywhere. the difference here is we're doubling down on the funding, and the exact positions that are being funded are data management analysts and lawyers who are going to now proactively do data

dumps, find out who the worst landlords are and go after them. probably not you. renting out to david is your own thing. >> it's nice to meet you. we'll watch with huge interest. new york city councilman helen rosenthal. coming up ebay ceo will be joining the show live for an exclusive interview. the company's first day trading separately from paypal. ent spontaneously turns romantic why pause to take a pill? and why stop what you're doing to find a bathroom? cialis for daily use, is the only daily tablet approved to treat erectile dysfunction so you can be ready anytime the moment is right. plus cialis treats the frustrating 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,

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