♪ ♪ happy friday morning, welcome to "squawk alley," kara swisher, co-executive editor at re/code and jon fortt and kayla tausche, on a day where markets are settling back close to the lows of the session. the dollar is a little higher. first up, apple will delay it's live tv service until at least 2016. bloomberg saying the company wanted to introduce it this year, but talks with licensing companies are moving slowly.

new reports that apple is very clikly working on a new car windshield. apparently, it will be a heads up display. similar to ones used by jet pilots. information for drivers while on the road. a lot to digest here jon and as usual we're talking about things that are a long way off. how much of a setback are these talks with programmers? >> well it's interesting. i mean i think on the one hand after apple music, i'm not sure apple is ready to soft tv problem. tim cook is talking about how much of a mess tv is i look at apple music. there's some good stuff in there, there's the interface is all mixed up. it's got the same problem that traditional television has. on the one hand, re/code said this very same thing -- about the delays in the live tv service months ago. peter qafka over there. and i think the sticking point, when you break up a bundle, do you end up paying more is a real issue. when it came to music you had

piracy on the one hand frightening content providers into offering their content for less. in this era of tv you don't have the same kind of leverage. look at the prices being paid for "game of thrones," netflix is dishing out for a successful series. i don't see what's going to pull people apple's way. >> you raise a good point. the music, music content creators had an advantage in offering their content for lower prices, but in tv it feels like there's starting ton be a existing economic framework that apple wouldn't be able to create its own terms, set the price for the content. because content creators have been moving in that direction. how much will that affect this? >> well i mean you know i did, thank you for noting that jon, pete der write about this months ago. it's not a new piece of information for everybody. it's just the continuing difficulty of negotiating with a lot of different, you have creators, networks, you've got all kinds of rights, a confusing

issue. there's lots of outlets, the question is can apple differentiate itself via a better service, a better experience. there's some very good experiences out there to watch television now. on amazon, on google, on apple tv as it exists right now. on cable on demand. there's lots of outlets for creators to take their, and content owners to take their stuff. it's going to be similarly complex to the music industry. >> the talks with programmers, kara, think people get we know why these would be contentious and move slowly. but the idea that apple would not have the backbone or the technology to insure a good viewing experience, does that not take some people by surprise? >> it's just a complicated thing, apple music has not been the smoothest transition. they've had hiccups with the watch and they want do get this

right. delivering tv on demand is not an easy thing and people have different viewing experiences that they want. and there's a lot more cooperation that's required. especially with cable and others. it's not an easy thing, it was a dream of steve jobs to create something like this. but it's just more difficult in the actual execution. >> something i think is really hard about live tv, that people don't think about is we're used to changing channels, pretty much on a whim with live tv. unlike when you're streaming something with netflix. you're willing to give a little time to buffer and you sit and watch it with live tv you expect a certain kind of serendipity with the experience. a certain amount of control, depending on how fast your broadband is at home you're not going to get that with a live tv experience without some sort of dedicated deal. which exactly the sort of thing that silicon valley has been railing against. they want net neutrality. >> trip chmpb choudry's track

record as an analyst is terrible. nothing he he says is going to happen. he's right less than twice a day. the whole broken clock thing. >> are you there with chip choudary. >> i think it's, i don't think they're going to make me kind of car parts, i think they're going to have a car experience, just the way they do with music or television. it might be nice that they want to make a car, but it's a very difficult endeavor and that's very far off and i suppose they could do that. and it makes for good headlines, but it's kind of not true. >> what are they going to make shocks and struts? can you imagine apple making car parts? yeah just roll up to your pump boys. >> we know the packaging would be beautiful. next up, twitter could have a new ceo sooner than we thought, suntrust bob peck

saying a decision is imminent. it could come as early as next week. he expects dorsey to be ceo, he says dorsey will remain at square and then even envisions, kara, some board shake-up after that does it make sense to you? >> he's mimicking, he's just repeating, i did an interview with chris sacca on my podcast and chris outlined this whole thing and bob just wrote it down and retyped it. i don't understand why he suddenly. chris was talking about these things and they're all very plausible and i think it's probably moving in that direction, but this was chris, every single thing you just said was what chris said on the podcast. and i think he referenced it. i'm not sure if he did extra reporting or something like that. but you know, adam bain is on vacation this week. i don't think there's going to be any shake-up. there's a lot of vacationing going on among these executives. >> i think the question, kara -- whether the stock price puts added pressure on the company when there was an expectation

that maybe we wouldn't get a real development here, maybe until next quarter. >> i think september is when they were planning on naming the executive theext got to work it out if that's the configuration this triumph virate. i don't think chris is dictating what the clear board is going to do. as to the shake-up -- maybe. maybe they will. >> we talked to jeff richards yesterday of ggv and we asked him whether or not he would be happy with jack either staying or going, it's this peck's report does not answer the question of whether or not jack could after what the twitter board has said. do both jobs. >> here's what i don't get. >> i'm interested in kara's take on this. costolo on his way out said yeah i'm going to stay on the board, that's important to me and jack seemed to sit there and nod. twitter said we're going to have a full-time ceo who doesn't have other jobs, that's important. they said the strategy won't

change. if they do this plan, they will have gone back on pretty much everything that they just said weeks ago. it's not like there's nobody out there who could possibly be interested in this job. i'm curious, what does it communicate if after saying they're going to do this broad search, they not only don't seem to do that. but then bring in a ceo in jack dorsey who has the exact qualifications that they said would have eliminated him from the job? >> well you know i'm shocked that gambling is going on in this place. i don't know, these company does this all the time to us. so i think that they, i don't think, one thing that chris did bring up, chris sacca brought up, was nobody was worried about the double job thing, except the board so they brought it into the narrative a little more. i'm not sure investors are worried about a double ceo necessarily. if it's the right ceo. you know, i think had this is something dorsey does want to do. and he doesn't want give up the other thing. it will be interesting to see if the board changes its tune and acquieses on this issue, special

entry they got get a lot of support from evan, the other founder and adam, the saelles hd who is very well regarded. >> the problem seems to be that there aren't that many examples of a ceo running two publicly traded companies. the only example that people even come close to calling to mind is steve jobs, pixar and apple. jon's mentioned that several times. the pixar arguably was much further along as a company than square is. square is at a pivotal stage in its development. especially as it's in a very competitive field. it's just about to go public. i think there is a natural tension between running these two companies and i'm wondering what your thoughts are on that? >> well they could get a ceo to run it and jack could be chairman. it hasn't gone public yet. filing is one thing, going public is another. maybe they'll sell. there's all kinds of things that could happen in that timeframe. i think that he refers to both

of his companies as his babies. i guess he doesn't want to pick one baby over the next. we'll see if the board goes along with that one thing is for sure, adam won't take the job if jack dorsey wants it. you need the buy-in from jack and the product side, very heavily for him. >> stocks not moving much on the sun trust report. but bob peck will be on the "halftime report" late they are afternoon. so stay tuned for that. another unicorn in retail, jessica alba's start-up honest, now valued at $1.7 billion. after raising $100 million in funding. this after zen99 closed its doors and zirtual laid off all employees with no warning. that company just raised $5.5 million. it has been a topic of discussion at this desk this week, kara. as to whether or not we're at some moment where investors get suddenly less patient. do you think?

>> well that's a big, i was at dinner with someone last night, an investor and he couldn't believe that valuation, it's a large valuation, a great company. it's just a question if it's going to be able to sustain these valuations, i go to, i'm surprised gambling going on in this place, they make these bets and hope for the best. they hope for a sale or something better. an ipo or something like that. i think that there's definitely a feeling of slight, is this too much and at the same time, the money keeps pouring into a lot of these companies and the failures don't seem to bother people at this moment. >> kara, i wonder, we look at zirtual and some of the other things we've been talking about. company dhas have some revenue, have growth. seem to think they were doing okay. but stumble either because of a lack of maturity and know-how in zirtual's case, it was a cfo, not having a cfo in place and not being able to keep track of cash flow, and also because investors aren't willing to pony up for something they don't see becoming a huge player.

is it too soon to connect the dots here? especially as we think back do what softbank just announced they're going to do, place bigger bets on bigger companies they expect to break out and place fewer or no, smaller vets any more in this environment? >> well it's interesting. i mean i definitely think the winners are going to win and the losers are going to be shook out and that's what's going do happen. there's so many fundings, every day we get another one. we've stopped writing about them because there's so many of them. you're going to see the ones making traction doing well, getting investments and the ones that are not, not getting them. the question is when do you cut them off? to a vc, $5 million isn't that much. it was a bet, it didn't work, they moved on to their next thing. you'll see that it rated over and over again. i'm not sure the two are corrected that doesn't mean that bigger, more successful companies aren't going to get more funding and get more overvalued, essentially. >> are there any less ps learned from the zirtual situation, the found anywhere chief tells

"fortune" that it was the issue of not having a cfo. the issue of only having two people on the company's board. those seem like easy things to solve if you identify them. >> no, i think they took the money and they couldn't make a business out of it correctly. everything is like we said earlier with apple. everything is in the execution. and it's not a bad idea, although i remember it was one of the ones in las vegas, think. so i think it's, you know, these things happen. these companies are started very quickly. with people that don't have as much experience, there's always a reason why it didn't work. it's never possibly that the business isn't big enough. but ultimately. i think most things come down to, is it a great product that people want to use? and two, is the company run well? those are the two things that mat anywhere success and it seems every company that has those two things seems to do rather well and those that don't tend to fall by the wayside. >> it will be an interesting back half of the year i'll tell thaw, kara. good to see you as always, good weekend to you. >> thanks a lot.

>> kara swisher joining frus one market. let's check in from the markets, we're paring gains across the major averages, europe has been lower. u.s. data was exceedingly good. ppi helped by rising rents, industrial production helped by a 10-plus percent gain in autos, we saw a downtick in consumer confidence when the markets started to pull back. right now the dow is just about unchanged, s&p 500 and nasdaq have gone slightly negative. it is a good day for retail. shares of nordstrom ralying after profits topped estimates. the company increasing sales forecast for the rest of the year. nordstrom shares up better than 5%. jcpenney having a pretty good day after its earnings came in better than expected. it was a loss of 41 cents per share, but a loss narrower than the street had been estimating. that stock up 7% because revenues also beat expectations, same-store sales jumped 4.1%. carl, the ceo saying that it

thinks it has good momentum for back to school. it thinks its inventory mix is right, especially in the home space. >> and suspicions they're taking share from a bunch of different players from jewelry to furniture. we'll see. when we come back one of the legends in the movie business on the future of film. tablets and netflix. we'll hear from pixar co-founder john lassiter. plus the top five long-term picks in tech. mark mahaney joins us and alibaba's jack ma may have dropped serious money on a brand-new mansion. opinions. there's no shortage in this world. who do you trust? whose analysis is accurate? how do you make sense of it all? a simple, unbiased stock score consolidated from the opinions of independent analysts... is that too much to ask? nope. equity summary score,

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our jane wells caught one a pixar legend, john lassiter. jane joins us with that interview. jane? >> hey, kayla, i'm in the studio exhibition right now, the pavilion. we're getting more on "star wars" today, the huge event tomorrow. george lucas sheer i'll have more on that shortly. big news out of the animation side which has continued to score well for disney. "inside out" a lot of joy at the studios, third best-performing picture so far this year, $600 million in box office and legendary animator john lassiter told us he's going to reveal more news about more movies,

including "the good dinosaur" coming out in a year. but this is the 20th anniversary of "toy story." lassiter revealed on our air, lassiter revealed something about "toy story 4" coming out in 2017. >> i'm direct i "toy story 4" which will be coming out in a couple of years from pixar. and it is something i will say that it's something we've never done with "toy story" before, with love story with woody and bo peep. >> and buzz? >> come on, and buzz? >> it's a new world, things are changing. >> bo peep. >> well it is california. we also talked about netflix, of course marvel has done a great deal with netflix. lassiter says nothing is in the works, but he loves netflix and likes to make movies which play on ought platforms. >> a lot of film makers only want their things to be seen on a big screen, which i like and

which is why we make them for the shared audience experience, i love watching things on my ipad and i love the fact that our films. one of the favorite things to do is when you're driving on the freeway and you see the minivans and the suvs with all the screens in it and we drive up and look in and it half the time they are playing my movies and i honk and wave and they have no idea and thumbs up, so anywhere you're going to watch my movie i'm a happy camper. >> all right. finally we expect big news about shanghai disney and given what's happening with the chinese economy, lassiter says he does watch chinese market performance in terms of box office, but not just there. >> we rethink for all of our markets. you know, southeast asia is a tremendously growing market for us, all of those countries down there, you know. latin america, brazil. of course europe is always really strong for us. we, we really are excited about all of these markets, but we're so excited about the markets

where the kind of the emerging markets or the growing middle class, they're building theaters like crazy. and they're gorgeous theaters, too. they're fantastic. >> so the theater is not dead. >> the theater is not dead. >> all right. more on "star wars" shortly. guys, if you know what this is -- you know how excited i am. >> yes, indeed. jane, i got to ask, did he say anything about jesse? i mean woody and bo peep? >> wow. i didn't even think to ask that i was so obsessed with my woody and buzz and the new world order, i didn't think to ask about jesse. oh, jon, see? >> i'm just saying. i've got kids that age. so they would want to know, jane wells with the -- >> my curiosity, my curiosity will be -- "toy story 3" wrapped it up so nicely i think the bar is incredibly high as it always is to bring it back for one more movie. >> the end was scary, though, i

was disturbed by the end of that but we lose been fnifer, what d get -- woody-peep? coming up, jack ma might have bought himself a very fancy new mansion. details in a moment.

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welcome back. alibaba's executive chairman might have just bought the world's second-most expensive home. the south china morning post reporting that jack ma paid $1.5 billion hong kong dollars, $193 million, for a three hon story mansion in hong kong's victoria peak. if you want to do the math that's more than $19,000 per square foot. the home has a 20,000 square-foot garden. views of victoria harbor. jack ma joined us last year and

told us how he spends his fortune. >> people who say jack, please, you know, rich people is good. yeah, it is good, but not that richest man of the world. of china. it's a great pain. because when you're, when you are richest person in the world, everybody is surrounding you for money. you made a lot of money. you got to spend it. you cannot spend buying ten bats and 11 houses. you want to spend money in an effective way. >> i guess that's jack ma's version of mo money, mo problems. the house of pain, being so rich is such a pain. >> spend more money, so people can't ask you for it. >> i don't think he's going to have that problem any time soon. he says that ever since public post. post ipo, life has been stressful. that theme comes back to him again and again. >> the telecom's magnate that

previously owned the house that he bought, he previously bought it for $21 million in the year 2000. quite a trade. >> nice flip. markets are closing in the uk and across continental europe. equities trading lower after flash eurozone gdp data missed a lot of expectations. investors are watching a key european meeting on greece's third bailout program. china in focus as well as the chinese central bank continues to intervene to halt the decline in the yuan and saying overnight that they expect to support equities over their four years. when we come back, leading internet analyst mark mahaney changing things up with his top stock picks in tech. we'll find out what those are, in just a moment. le for medicar? that's a good thing, but it doesn't cover everything. only about 80% of your part b medical expenses. the rest is up to you. so consider an aarp medicare supplement insurance plan,

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here's your cnbc news update. rescuers in china pulling out a firefighter who was trapped for 32 hours in the massive explosions in the port city of tianjin, the 19-year-old was take ton a hospital where he is in stable condition with burns. by a 222-64 vote greek lawmakers approving their country's draft third bailout. the move came after an all-night session marked by debate and delays over the three-year, $393 billion rescue package that includes harsh spending cuts and tax hikes. republican presidential candidate marco rubio speaking

at the foreign policy initiative in new york city. he slammed president obama saying his policies have failed to leave the country better off. adding if he became president, he would roll back administration policies in both cuba and iran. well a bmw owned by steve jobs, may have been owned by steve jobs is for sale on craigslist, the seller is seeking $11,000 or an offer of trade for a bmw convertible. that's our cnbc news update, back to "squawk alley." historic moment taking place today, the american flag flying in cuba for the first time since 1961. our michelle caruso-cabrera is there live this morning, good morning again, michelle. >> good morning carl, let's show

you that defining moment once again from the event that just finished roughly an hour ago. the three marine who is lowered the flag at the u.s. embassy back in 1961, when the u.s. cut off diplomatic relations with cuba, well they were the same three marines who were here today to once again raise the flag. to officially signal even though they've already been reestablished to officially signal that the u.s. and cuba have reestablished diplomatic relations. john kerry as he spoke, made it very, very clear that beyond the diplomatic relations he would like to see more economic relations between the two countries, even though there's still an embargo in place and he welcomed american business interests in this island. we are encouraged that more and more u.s. companies are exploring commercial ventures that would create opportunities for cuba's own rising number of entrepreneurs. and we are encouraged that u.s. firms are interested in helping

cuba expand its telecommunications and internet links. and that the government here recently pledged to create dozens of new and more affordable wi-fi hot spots. >> we of course know of hundreds of executives from the united states that have travelled to cuba now to explore the possibility. and while it's slightly easier, there are still so many hurdles to doing business here. especially he had it comes to the cuban government. you cannot hire your own employees, they're going to be prescreened for you by the government. you cannot decide what you're going to pay them. and you don't pay them directly. you pay the government and the cuban government, what's the highest labor tax in the entire world takes 95% of it, gives only 5% to the cuban worker. it goes on and on, there's a monopoly on imports for only the cuban government. that's why when you walk around or travel around, you see the same products over and over again. there's no variation, because only that which is permitted by the government is actually imported. there's so many things that need to change in this economy.

above and beyond what's happened here today. but it's widely believed that it is a start. back to you guys. >> all right. thank you, michelle. up next we go to a galaxy far, far away, the hype for "star wars" in full swing at disney's d 23. but first, rick santelli, what are you watching today? >> today a smart guest described some of the aspects of china and its effects on the global marketplace, is a tempest in a teapot. you know what we're going to talk about today? we're going to talk about a tightening fed and an uptight marketplace after the break. ♪ ♪ it took serena williams years to master the two handed backhand. but only one shot to master the chase mobile app.

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> . coming up, the big call of the day, bob peck saying a decision on twitter's next ceo sim nent. he's going to join us live. plus shake shack serving up options, are they the right strategy for you? our options guru, jon najarian has the play. and one of the top fund managers on the street joins us live, fidelity's peter dixon. his focused fund up 23% over the past year. we'll get top plays from him as well. >> thanks, scott. a top internet analyst shaking up his top picks, taking aim at fang.

rbc's mark mahaney is out with his picks, swapping facebook for google. joining us to break it down is mark mahaney. great to see you. fang, facebook, amazon, netflix, google, loosely credited to carl. although we give credit to jim cramer for coming up with that one. you say there was some fundamental shifts this quarter. what were they? >> so i think actually fundamentals were very much intact. if you look at the year-over-year growth rates for the online travel and retail names, a few inflection stories, has to be amazon and the two broad themes across the group. you mentioned fang, which is the real tipping point in terms of offline media dollars, migrating online and second start to see negative implications of unicorn bubbles. a couple companies are worried

about salesforce employee retention. yelp was one of those. >> wik do you think that trend that you just mentioned, this problem with retention, especially for the companies whose stocks have underperformed, why is that coming to roost now verl sus earlier times? >> it's a hard one, it's hard to know the timing of it. you've seen valuations get more robust in that private market space and you've seen some of the companies, yelp is one, twitter is going to face the problem, if they don't turn that stock around. the timing those things kind of came together, so you've got employees very good coders, very good marketers, especially if you're based in the bay area, you see these lottery ticket opportunities down the street. some of these unicorns, it's kind of hard not to see that being an issue for the public companies and it's showing up now. >> one thing people point to in google's restructuring, a lot more units with more titles to pass out that might help attract some people who might otherwise have gone to a unicorn.

you're the ceo of this additional business unit that we have. >> the advantage that google has is the size of the company allows them to match dollar for dollar, just about any offering out there. and it's hard for that to show up in a p & l. given the size of the p&l that we're talking about. it's also a smart move to give people some of the leaders, more autonomy and incentivize them to stay with google. a nice little advantage of the reorganization that they did. >> mark, tell us about kicking google over facebook. i mean i'm taking a look, facebook is up 16% over the past three months. but after the latest possible. google is up 25%. of course facebook has gone up more over the past year. is this a valuation call? or is it something else? >> jon, it's mostly that. the risk/reward here looks incrementally better for google than facebook. we still like both names.

you point out three-month trend if you look over the 12 months, we've had a nice rally in facebook stocks twice. last year and going into the june quarter print. facebook continues to be a good long. you know the upside for us is 10, 15%. google has a couple of catalysts, some will be negative. the european issue and maybe apple. but one major catalyst in terms of cash returns to shareholders. which means you could get 20-25% return. it's the relative risk-reward on the stocks. >> you get to a point with stocks in the sector, after they've run up, the valuations get high, there's less upside to be created. i'm wondering what sort of caution you're inserting for buying at these levels. facebook up 20% year to date. >> kayla, you're right. it's probably the biggest thing i'm focusing on now. on the show, six, seven months ago, we were calling bottom on the stocks, they were multiples, facebook wasn't but now you've got a half dozen of these that are trading close to their peak

multiples, we should be more moderate in our outcomes for the stock. take the netflix stock that was at the top of the list earlier. it can't be one of the top picks now, given the rise in valuation and rise in stock price. calling the top is very difficult so we lead with fundamentals, some of these with rising stock prices, still great fundamental trajectories, so we'll stick with them. >> king's results were disappointing and you lowered the price target on that. looks like more of a hit company versus the platform that some companied. are you seeing that across some other companies as well? because there are questions about other company and whether they have the scale possibilities that some investors have hoped. >> you know, jon, the issue with king is it's sort of fashion risk you have with gaming companies, they have lightning in a bottle. they had such a tremendous hit with candy crush and all the credit to them for that it was almost impossible to follow up to that. to their credit, the management

team is doing what they should be doing. they're returning a lot of cash to shareholders, because they acknowledge it was lightning in a bottle. we're not buyers of the stock, we're not recommending it. i like the fact that they're doing the fiscally responsible thing and returning the cash to shareholders, it's not buy, not with this kind of fashion risk in the name. probably a permanent feature of the stock. >> nerms of your small-cap longs, grub and pandora among them. you're flying in the face of some stocks that get beaten up at least on social all the time. why? >> carl, you're right. it's small cap internet has been dramatically, it's been dramatically underperforming segment for the last year or two. and it's very hard to have long recommendations in there. unless you get lucky and one of them gets acquired like trulia or an open table or orbitz was. there are a few big wins like that. in this space we're sticking with a few names where we see a lot of risk but we think there's

asymmetrical risk/reward. pandora, we go through the rates decisions, the royalty rates decisionings in december. you get a chance for international launches going into international markets for this company next year. those are two major potential positive triggers for the stock. if those come through this isn't going up 20% or 30%, this could be a double from here. it's that kind of asymmetrical risk/reward that allows us to lean in and put a buy on pandora. >> though stocks are down 30% in the last year. we'll see if they turn around. we appreciate your time, have great weekend. meantime, the the empire descending on disney's d 23 as the force surrounding "star wars" continues to build. our jane wells has the story. >> well i do love a man in uniform. "star wars": the force awakens, the big event today and when it comes out in december it will be the ultimate test of disney's $4 billion acquisition of lucas films. we're going to learn more about

the new characters. here are a couple of them. ray is a scavenger, behind her is finn, who starts out apparently as a storm trooper and their new droid, bb 8. disney has released new images of these new characters, these pictures show all kinds of new characters, good guys, bad guys, movie apparently takes place 30 years after the return of the jedi killed off the emperor and darth vader and things are still kind of a mess. storm troopers are now part of the first order. the last official trailer was released in april, showing all the favorites are back. >> now we've been told not to expect any new video this weekend, but we're hopping for new details about the film and about the hans solo spinoff and at comic-con, they did release some behind-the-scenes video. >> all right. jane wells with that report on "star wars."

of course we're geeking out, excited about it. let's get to the cme group now on a friday, rick santelli with the santelli exchange. >> well thank you very much, jon. being in chicago today is an odd day to gauge water cooler talk. they're talking about the bears thinking they had a dream we came back last night. they're looking at the cubs and think we're going to redefine the history of the goat. but the one topic that never gets old and never has a lack of people trying to participate on this trading floor, that's the federal reserve. harken back a bit. remember in subprime and not to pick objen ben bernanke, such a little thing, how could it make that big a difference. what i remember more that made a big difference, the whole notion of think back about adjustable rate mortgages, a.r.m.s, what happens with an a.r.m.? you pick some magic rate, short rate and every interval, maybe it's one year, whatever the

short rate moves to, that becomes the reference point for the finance structure of your mortgage. now think about this, when jim bianco was on the floor with me he was my guest, we're talking off-cam remarks he brought up an interesting point. having this very conversation. he said that he would estimate that there are half the derivatives out there that price to some short rate, that have, half of the big derivatives out there with finance, half of them are going to price to some short rate. no matter what it is, think about what he's saying, whether it's a derivative that is a hedge or derivative for some type of complicated structure or funding, whatever it is, half of those derivatives out there and there's boat loads of them. will have something like an adjustable rate mortgage. focus in on something when that changes it changes the entire valuation of whatevers that. whether it's a hedge or a source of funding. well what does that mean in english? it means that if you talk to certain fed officials or very smart academics, what i call the

conductors of the band. they're very clinical. they're very this is the way it is. but the markets aren't clinical. as a matter of fact, whenever you mix finance, the fed, the short end and of course, the normalization that needs to occur, what it really becomes is thinking about how much a little bit of a move by the federal reserve is going to have a leveraging effect and just repricing derivatives. that isn't where it ends, i guess the story is, is that i understand about keeping calm, supposedly a white paper that's going to come out soon from the new york fed about liquidity in the marketplace. but in the end, if you're not part of the inside trading group, you're an outsider and it's very difficult to put yourself in their shoes. but i will tell you this -- adjustable rate moshlgs didn't have a happy ending, no matter how small the normalization is it's going to have an outside, outsized effect in the marketplace, kayla, back to you. >> rick santelli in chicago,

thanks. coming up, we hear from the latest silicon valley company do change its maternity policy. why this company thinks it's helping it for the better.

imagine and i know that there are benefits expanded benefits also for adoption and for parents who didn't personally give birth to the child also. but i want to ask about this

issue. i know a number of moms in silicon valley who have told me that actually re-entering the workforce after maternity leave can be the hardest part. often they want to come back part-time from a period of time and the response from the employer is sure you can be part-time, but we still expect you to do everything that you were doing before. how do you expect to address that? because from what i hear, the longer you take off, the more challenging re-entry can be. >> well, what we've actually found is that you know, different employees have different requirements. but a lot of our employees stay engaged throughout their leave. that's not something that we ask them to do. in fact it's something that they often want to do. they bring their little babies into the office. and it really allows us to have more of a family-friendly environment, which is something we encourage at adobe. flex time has always been something that we have really supported. so it's not atypical for someone to come back after leave. and frankly to have modified hours. or modified schedule to start

with. and then they really figure out what's right for them. so i would not say that we have a lot of employ ees that ask fo part-time work. rather we have a lot of employees that ask for modified schedules. >> a lot of attention is paid to netflix' policy of telling people you can take as much time as you want up to a year. what i wonder based on that is would people actually take a full year off or are people more likely to take just what they feel is socially acceptable? when you look at the amount of time, that people take, based on you defining how much time they can have, what do you find? what do you expect will happen at adobe versus a company that might leave it open-ended? >> well with a company that's defined at adobe, we believe that people will actually take the 26 weeks, because we've defined it. it makes it really easy for the manager to set expectations, to actually get somebody to cover off for the respective employee.

and that way, it's a framework for both the employee and the manager. i expect that whether it be 26 weeks for a birth mom or 16 weeks for somebody who might have adopted a baby, our employees will take that respective period of time. >> and the impact overall on morale of these moves? you find -- can you tell me first of all, what percentage of your workforce is women? and impact you expect on morale with the policy shift? >> right. so approximately 30% of our workforce overall globally are women. and you know, as mentioned, we've already had an outpouring of support, both from our mums and/or future mums perhaps. and also if men in our workforce if anything, i believe that this is going to be a great effective program for both the attraction of talent, but also the retention of our great employees, too. >> significant shift in policies in tech, we'll see if it has an

effect on the other industries that compete with tech. that want to attract women to the workforce. when we come back the spotify list for the commander-in-chief in a moment. equals great rates. it's a fact. kind of like shopping hungry equals overshopping. will damage your teeth? introducing listerine® healthy white™. it not only safely whitens teeth... ...but also restores enamel. lose the nerves and get a healthier whiter smile that you'll love. listerine® healthy white™. power to your mouth™! i am here to offer sophisticated investing strategies. my technology can help you choose the right portfolio. monitor it. and automatically rebalance it. all without charging advisory fees, account service fees or commissions. that may be hard to compute. but i'm a computer. so trust me.

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can you tune into the same jams as the president, the white house launching an official channel on spotify that features playlists from the president himself. the first round includes picks from the stones, morrison, mos def, beoncircumstance coldplay, beyonce. my favorite things. everybody asked what about apple music. >> the lum ineers. >> i loved bob marley "so much trouble in the world." >> we know apple has been a backer of the party at least over time. why would you support europe's biggest start-up instead of apple? strange, yeah? >> maybe he's trying to play middle of the road. doesn't want to pick one

particular platform. since it's not available on android yet. >> we wrap up the week with an afternoon session. scott wopner and the half. ♪ ♪ jon najarian and sarat satil our game plan looks like this. how low can it go. after touching the lowest levels financial crisis is oil anywhere close to a bottom and will dividends be the next thing to drop? retail/detail. peter dixon joins us live on the best bets to make in that sector right now. we begin with word that one of the most closely watched ceo surges in recent memory is nearing an end and a dis