been suffering as a result. back to you. >> david, good morning. it is 8:00 a.m. at tesla headquarters in palo alto, california. it's 11:00 a.m. on wall street. squawk alley is live. ♪ >> kate mitchell's co-founder, fwraits to have her back. as always, john ford, and kayla. the markets having a spill in the early going, but managed to recover some of the early losses. all the major averages posted their worst day, of course, in

over a month where heed. the nasdaq finishing down more than 3% in that session, and then there's this new video that investors carl icon in which she's warning about danger ahead. take a listen. >> low rates by almost definition building bubbles. building real estate bubbles, building bubbles in the art market. the fed balance sheet has mushroom from less than a trillion dollars to over $4.5 trillion which is a huge almost unbelievable move. all that money crowds out the little guy, the middle class investor has nowhere to go with their money but into the market or even more concerning -- we have cross currents here. we talked with you wu a lot about valuations over the past several months. icon comes along with this echoing his own concerns.

we have the second best consumer confidence number since 2007. how can all of these things co-exist? >> well, it shows you we're probably in a period of correction. you would expect to see this kind of turm oel as the good news collides with concerns. i think this does mean we're in for a correction, and it's good for the markets private and public. >> one reason why the warning is coming and why it's so press issing we are, of course, on the cusp of an interest rate hike by the federal reserve. 25 basis points in and of itself won't do much, but how do you see the unraveling and the capital flight to progress from there? >> well, it's interesting because i think even though people are holding their breath for september and the public and private markets, the fact that they delayed it was only a delay. i agree with you. i think everybody is making it into their plans that this is going to be happening sometime soon. i think there's a sense of

conservativism in people's forward plans, and you can see that now translating into the pricing and the stock market. >> it's interesting. i track about 88 tech stocks on a day to day basis. 16 of those are up. only 16 over the last three months. the ones that are down the most, alibaba, badu, yahoo and jd. over three months down. more than 20%. all obviously china-related. some other stocks that are down. hp, qualcomm. both of those have had china-related troubles. qualcomm on intellectual property. hp just has struggled there over time, and, of course, faces a lot of pc-based competition out of china. a lot of the pain, the biggest pain in tech anyway, has been china-related. i wonder if something else happens because of some of the debt ceiling concerns we have at the end of the we're, or in tech at least is much of the concern

kind of confined to china? do you have any thoughts on that? >> right now tech, you know, again -- technology plays a role everywhere. as we saw with vw's bad news with their emissions work-arounds of defeat switches. tech is everywhere, and i think these days it can be isolated. those that are exposed and have taken that risk to be exposed, unfortunately, wrote it up, and now we're riding it down. i think there's still a lot of opportunity as it plays out. again, i think you see this as an important influence. obviously china is a huge market. i think so far it's not rippling any further. when it hits the global economy, everybody slowed down happens. then i think you start seeing just a general economic malaise, and that will affect every market. >> next up, another topic.

plans to spin off about 22 billion yahoo says it expects to complete the spin swrof in the fourth quarter. shares of yahoo rallying on that news this morning. kayla, it was described in the early days as beautiful. the tax structure was so beautifully constructed. now we're at a point where people are just willing to do it no matter what it means. >> i think that investors are a little bit fearful. they know that yahoo is relying on the advise of internal and outside counsel on this issue. they would have faced an $18 billion tax bill had they stoled the stake outright. now that would be about $7 billion. they are still saving taxes in pursuing this structure, but i think there's a fear that for a year or so yahoo stock will trade with some sort of multiple overhang. that push could come to shove retroactively from the irs should there be some sort of ruling or revisiting of this

stacks structure given that they're going forward with this without the blessing of the irs. kate, i'm wondering when you are looking at big corporate companies that are evaluating the assets that they have under their roof, looking at a potential spinoff, looking at a monoti sdmr ation. does what the irs is doing, does it change the calculus for another company looking at this? >> it has to. i think something that's that large plays into everybody's plans. certainly most of the small private companies still get purchased by large strategic buyers. in fact, they always are looking at the tax benefits that come with it. that said, it appears that yahoo is deciding to take its medicine despite the tale with that overhang. get back to business, focus on the core business, like a technology company needs to, get the alibaba story behind them, and build yahoo forward. >> funny, though, john. marissa meyer's tenure atta hue has been defined by this alibaba stake.

yahoo's valuation has been defined by it. now you think she can't wait to get this off the books. >> kind of like low interest rashgts or how a lot of people feel. you want to get alibaba out of the way if you are yahoo and see how the core business performs. it's gone from having little value at times to having a little bit more. at least in the eyes of investors. they have to get the core business growing. they've got to show that mobile growth and video growth that's going to outpace the decline in the tradional display advertising business, whichas been brutal. i think marissa myers got to make the case all over again that she's even doing a good job. i mean, the core business itself, the business overall has just been stagnant, and investors are frustrated, especially because alibaba isn't shining sunshine. >> we talked about that long leash that she had because of this stake, and watch it get shorter and shorter over time. >> finally, tesla getting ready to launch an all electric suv. the company set to start deliveries of the model x today after first being unveiled back

in february of 2012. elam musk says he will host a web cast to show off what he calls the real thing. tesla is still hoping to sell at least 50,000 cars by the end of the we're. of course, it's also -- tesla is a story of demand, but also supply. you're in an environment, though, where seeing these cars on the road is a lot more common place than where we are. >> it is. it is. i have had folks. there's a tremendous demand for tesla cars. people like the design. people like the technology. people like what it does for the environment. i did have somebody who is very excited about the suv be surprised to see the wing doors because most suvs have things that go on the top like for camping trips. i think this is not meant for campers. i think it's meant for folks that really want to drive a really good-looking suv, and they do something pretty amazing. i think the demand will stay strong. >> maybe not meant for campers, but the subtext of releasing an

suv is perhaps this is something that will finally target women, of course. they value safety. they value the suv. they value the third row of seats more so than the men who prefer just the driving perform wrans. do you think this will really sell women on tesla? >> oh, i think it will. that idea that you can open that door and put everybody in and pull stuff out, i think it really will. it's ease wrer to park and visibility looks to be better. everyone is really excited to see what this looks like. >> the problem, though, kaya with those wing doors, you can't get the kids in the car in the garage during the winter because, you know, unless you've got like a five car garage, which a lot of people don't, even the tesla buyer, you got to back it out of the garage into the driveway before getting the kids in. if it's cold -- in california that's not a problem, but if it's cold, i don't know. >> thanks for the warning on that. >> just letting you know. real world problems. kate mitchell joining us today from out west.

thank you. we do have a news alert on a new streaming service from comcast. our julia borstein has some details. hi, julia. >> hi. comcast is launching watchable. it's a new free digital app. there will be watchable app and website perhaps most importantly for comcast. a tab in the cable interface with x-1 which is in ten million customers' homes giving those customers easy access to watch on the big screen tv the types of videos usually watched on youtube on a small mobile screen. the app has content from about 30 digital network partners including maker studios, vice, buzzfeed, and gopro, which will share revenue with comcast. while these partners also have channels on youtube, and you can find their content elsewhere. watchable won't have youtube's user generated content or repurposed tv content like hulu. its focus is on that short form professional video that makes it more similar to the go 90

service. comcast move to capture a piece of the fast-growing digital video ad market that's still about 1/10 the sees of traditional tv ads and comes as the media industry faces growing concerns about declining tv ratings and ad dollars. as the company relies less on selling bundles of tv channels and more on selling high speed broadband. now, a source tells me that comcast is giving its content partners about 70% of the ad revenue. that's better than youtube's and facebook's roughly 50-50 split with their content partners. it's giving them reason to bring their content to watchable so it can learn millenials and give them more reason to pay for its budgets bundles. comcast is the apparent company of nbc universal, which cnbc is a part of. >> does that mean limited number of content partners, sample users, or, forgive us if anything goes wrong because we're still getting the hang of it? >> i think the latter. they'll be rolling it out slowly, but they do have the 30 content partners on board. it sounds like they would perhaps like to bring on even more content partners, but right

now those 30 include most of the big names that you'll find on companies like youtube and even across the web when you are looking for the professional short form content. in terms of reaching the million x-1 homes, it will be in beta the next several months. >> will people associate it too much with comcast, the big cable company? also, the branding seems a little modest. watchable as opposed to unwatchable. you can watch this. >> i think it will be interesting to see what it means for those people with x-1 in their homes. it's the sort of high-tech cable box, and what comcast says is sthoez people with x-1 boxes are more likely to watch things on dvc railroad here more sophisticated. the question is when they're flipping around with their remote control, if comcast makes it ease where i to flep over and watch a video from maker are they going to stay within that comcast x-1 ecosystem as opposed to pulling out their phone and going watching someone else's ads? >> evolution continues. >> exactly. >> thank you so much. our julia borstein.

when we come back, a new machine from keurig green mountain will let you brew coke in your own home. is it enough to get the stock back on track, though? ceo brian kelly will join us in a cnbc exclusive. plus, axle springer buying a controlling stake in business insider for over $300 million. founder and ceo henry is with us live. facebook making a major push into the world of tv. a top voice from the company will join us to break it all down when we come back in a moment.

>> known for its single serve, keurig green mountain is now hoping cold beverages could help drive sustained long-term growth. keurig shares are down nearly 60% year-to-date, though they are up more than 1% today. let's bring in sar why eisen who spoke exclusively with keurig's ceo brian kelly recently. sarah, to discuss cold with a k. >> keurig needs a win. it's been a tough year. all sorts of stumbles, including the release of 2.0, the hot brewer. now they are banking on this new cold machine in partnership with coca-cola to be a hit. the machine costs $300, and it is big. i sat down with the ceo, brian kelly, at the headquarters in burlington, massachusetts, and i asked him why consumers need this cold machine. >> the four big differences are, fist, it's perfectly cold.

we have to bring that water down to just above freezing so you get a cold drink in just a little more than a minute. second thing is it's fully carbonated. the beverage is perfectly blended. every time you get the perfect beverage blend. the brands like a coke or dr. pepper or sprite or ginger ale or canada dry, you get the beverage you want perfectly each time. then we had to be able to to it in a very small footprint. in essence, we were able to bring a bottling plant right into the home and put it under the counter in a small machine and give the consumer the ain't to, again, put a pot in, push a button, and get the perfect fresh beverage each time. snoo some of the analysts that got a look think it's too big to put on your counter. especially if you already have a hot machine. pretty large footprint to put a hot machine and a cold machine side-by-side. >> actually, when you look at it and you see it, it's perfect counter size. it will get a little smaller over the wreerz just like our hot machine did. we started with a machine that was a little bigger, but the

technology gets better. you get it thinner and smaller, and it will occur over time. the machine is not too big. it's perfect. the consumers who have it love it and they find a place for it, and it fits right you shouunder counter. >> what need is this fulfilling? >> what the consumer has told us is that they want fresh beverages at the bush of a button. they actually didn't know they wanted that in 2004 when we launched keurig in the home, keurig hot. now that they get it, they see they can have a complete choice, a lot of variety, they can push a button and get a starbucks coffee, green mountain coffee, any kind of coffee they want at the push of a button or a tea or cocoa. this cold idea came from the consumer. they told us this is what we want next. it took a lot of time to get those technologies right, to get the chilling technology, the blending technology, get all the thermodynamics right, be able to chill and carbonate perfectly and get it in a footprint size.

we deliver a fresh beverage in the home and that's what the securely told us they wanted. >> do you plan to lower the price as you scale this product? >> what happens is as you build scale, the costs will come down over time. just like it did with the hot system. the hot system at launch was in the high $200 range. you can see what's happened over time. the sale thing will happen with the cold machine. both with the machine and the pods themselves, the beverages. like any technology, when you start, it's a bit more expensive, and then will come down the curve. our cueing keurig consumers really want it. they told us they love the whered of cold. we've done a lot of home use tests, and a lot of research with the consumers and they love it. >> the consumers are moving away from carbonated beverages. sales have been declining in this country for the last decade, even more. why go into a business that's not growing? >> yeah. forget about trajectories for the moment. trajectory is a short-term, and they'll move up and down. think about the fact that cold beverages are five times the

size of hot beverages. the keurig system we have today is hot beverages. cold is five times the size of it. it's not just carbonated beverages. we have all the carbonated beverages, but this is a new age and progresssive machine that will do any beverage the consumer wants that's cold. over time here you'll see new categories. you'll see beverages. in fact, when we launch, you'll see kraft sodas, you'll see juice drinks, you'll see sports drinks, you'll see teas and carbonated soft drinks. >> iced coffee? s. >> not initially, but over time. every beverage that's cold will be able to be made in this machine over time. >> soda stream. that's sort of the best test we have for make it yourself carbonation. >> we've listened a lot to the consumers of in home machines today who have them in their home, and what they've said is they want a machine that comes out cold. the product has to be cold. we deliver that. we told us they want it carbonated without a co2

canister. so we deliver that. the cash nation source is in the pod. the consumer doesn't have to recycle that canister or bring it back to refill it. you can't throw them away. we had to deliver that. they also want the brands they love. in many of these other machines, you can't get a coke or a dr. pepper because these are really hard to perfectly blend to make sure you can deliver the perfect beverage each time. we listen to the consumer. that's what they want. they want it at the push of a button. >> investor sentiment is down. it must be difficult to watch your stock go from one of the best performers in the s&p last year to one of the worst this year. down 60%. >> yeah. >> what's that been like? >> you know, the stock price we don't watch it every day. we know that the stock price eventually reflects the value of the company over the long-term. it will. it does over the long-term xshgs that's what we're focussing on. you know, we have to stay focused on the product, on delivering for our consumers and our customers, and that's what we're focussing on.

>> sales are set to be negative for keurig green mountain. they've had a lower guidance three times. i asked brian kelly when they would turn around. they said he wouldn't comment on the that in the interview, but that the holiday season is going to be important. it just gives you a sense of just how much is riding on this cold machine. i thought he did address some of the concerns on price, on size, but he gave me a demo of the machine. we went through just how it would work. takes about a minute to brew once you push the button, and you can make a real coke. it does taste like a real coke. i tried it. i tried a number of the drinks. they all taste good, and they're cold, which is different than a soda stream that carbonate themselves. the question is, though, what convenience does it really add to the consumer? the one thing that i took away from this visit that they really hammered home was in 2004 people doubted the keurig hot machine, and if you look, there's a lot of negative press about it at the time. they said why does anyone need this? we like to brew our own

coffeepots. it added convenience, and it became a hit. that's what brian kelly is sticking to when it comes to this -- what he calls disruptive consumer innovation of cold. >> you know, it's an interesting time to be unveiling a cold product seasonally because it's september. summer is over. you would think that just from commonsense you would want to be rolling something like this out in april as weather is warming. >> well, i mean, i think what they would say is that cold soda, even though it's a shrinking market, it's still a $50 billion market. it's a staple in consumer diets, especially in the united states, and that they wanted to get it out in time for the holiday season. that's very important to them obviously when it comes to gift giving. it's not going to be fully on shelf stores until next year retail-wide, but it will be launched on-line, and i think they just wanted to get ahead. look, they're stumbling with hot right now, and the stock is down sharply. they wanted to create some excitement. >> all right. one minute for one glass of soda?

>> one minute for one glass of soda. correct. >> all right. better not have any friends. huh. great interview with the ceo. as we count down to the european close, one more check on the dow. looks like it's lost just about all the gains that it had creating about flat. we'll track that and more economic.

a rebound in glencore hasn't done wonder for europe's market, but at least we're not down by a large degree, simon. >> we've stabilized. i think that's the important take-away after yesterday's falls you've had on recent sessions. what's interesting is how the consumer confidence figures are coming in strong today on both sides of the atlantic. for the euro zone economic sentiment now at a four-year high, and italy absolutely racing ahead to a level we've want seen since before the financial crisis. coincidentally, an italian delegation is here in the city

led by the prime minister at the moment touting italy as no longer the problem child for europe, but potentially a golden example to the rest of europe. here's the chairman. take a listen. >> people are bored of prizes. people -- its italian people have good savings. they own their houses, and 80% of the houses are owned. there's a lack of jobs. that's the real thing. people want to go back on a positive mood. >> on the down side for the market today. european health care and biotech stocks have been hit in the weight of the drubbing we had yesterday on this market. as cole mentioned, glencore is mentioned higher. we've had a reassurance statement from the country xshgs a lot of the sell side at lowests like citi who have a buy recommendation have been defending their position on that stock. glencore up 16%. the company saying they're operationally and financially robust spshgs they retain strong lines of credit and access to funding. it's important, of course, for the trading business.

have you upgrades from the analysts working their way through, and finally, i want to mention rwa. the deputy chairman of angela merkel's party has suggested in a newspaper interview that it's not fair to destroy rva's business model with the nuclear aspect and renewable energies and not come in to partner them with financial support. it may be that rva and by implication presumably its rival eon gets support from government moving forward. not least for the decommission of the nuclear operations. >> thank you very much. when we come back, betting big on digital. business insider getting butte bought by german publisher axle springer, valuing them at $400 million.

>> hello. i'm sue herrera. here's your cnbc news update at this hour. president obama opening talks with cuban president raul castro. the meeting taking place on the sidelines of the annual gathering of world leaders at the united nations. the two smiled, shook hands before beginning their private talks aimed at normalizing relations between the two countries. the german cabinet approving tougher asylum laws at a meeting chaired by angela merkel. it's trying to combat the current refugee crisis. migrants will be returned to

their countries of origin if they are found unworthy of protection. in planned parenthood's first congressional appear wrans since being embarrassed by credit secretly recorded voez, the ceo and president says she's proud of its provision for fetal tissue for research. she also sought to minimize the organ donations as a small part of its work. and today is national coffee day. at participating dunkin' doughnut stores, you can get a free medium cup of dark roast coffee, hot or iced. krispy kreme donations a small free cup of joe and a free glazed donut. yum. that's the cnbc news update this hour. back to "squawk alley" and you guys down there. >> i could use it right now. thank you. >> i know. me too, right? >> it is official. german publisher axle springer announcing it has acquired a majority stake at business insider. swroinks this morning is business insider founder, editor, and ceo henry. congratulations. so happy for you. when did this all start?

what was the genesis of this deal? >> it started about a year ago. as a provincial american i confess i didn't know much about axle springer. our president julie hanson came back and said you won't believe the company i met. you guys have got to get to know these guys. they're great. it really is just an incredible company. we started talking to the men, and they made a big investment, and over the course of the year, this developed. are you amazed at what you built in such a short period of time? >> i'm just incredibly impressed with our team. so gafl to our readers that stood by us over the years as we learned. everyone has just done a fantastic job. we had a great board. we had an incredibly supportive investors. whole processes worked great. i'm not amazed in general at digital media. i do think that it is the future. i think that we are as an industry where the cable network

industry was in the late 1980s and early 1990s when you were a tiny financial network that nobody heard of or watched that grew into this massive global media enterprise. i think that's where digital is, and so i think that investors are willing to take a very long view of it, the valuations start to make sense. >> people are going to be looking at this deal and wondering what it tells us about this date of digital media, the landscape for digital media when read code sold to vox cara shisher told vi the fact that competitors were raising so much money changed the game for them. they had to do something. i'm wondering why now is the right time for you guys to do a deal? how competitive is the landscape? >> it's though question that the game has changed. you look at buzzfeed, they raised $200 million. vox did the same thing with your parent. those -- it's important to put in context. basically it's just now that digital media companies are starting to raise the kind of money that has been given to cable networks, magazines and others for years. it's almost as though we were

playing at the nickel dime and poker table, and now moving into the bigger world, and so those are big checks. they absolutely do change the game, and certainly that was in our view too. >> traditional media doesn't have that valuation anymore. it's about a quarter of the valuation of the "new york times". that's kind of mind-blowing when you think about this. where do you go from here in an environment where we've got ad blocking now, program attic advertising, all of those things challenging an ad supported business model. now that you have this bigger parent that you are a part of, what can you build? >> programatic is growing. the industry is changing after many years of building up. it's really moving this year. that's one of our fastest growing revenue streams. over 100% a year. video is growing very rapidly. mobile. native. commerce affiliate fees are growing very rapidly. business development. all those are good. ad blocking is definitely going to be an issue for the industry over the next year or two if it grows. we do see what we sympathy will happen there is that publishers and advertisers will get more

careful about the size of the files that they're downloading and really emphasize performance and in exchange i think folks who like to read free stuff are going to have to realize you either are going to accept ads or you're not going to be able to read free stuff anymore. there are subscription options for those that don't want to. i think as an industry we'll find our way through that. >> let's talk about you for a moment. you gave an interview not long ago saying you did not want to have your career end the way it ended in securities, so what does this mean for you? does your role change, and although it's a tacky question, how much does it mean for you financially? >> well, going back to that, yes. the 35, the way i left wall street, i felt shamed and humiliated by that. i didn't want to give up. i had kids. last thing i wanted for them is to say, oh, what happened to you? i wanted to actually say, okay, step up. get back in the game. start to do what you can. i am just so grateful to so many people along the way who gave me

the hands to earn back the trust that i lost, including everybody who works at business insider, all of our clients, all of our readers, so many people over the years. i'm just tremendously grateful for that. obviously, look today is good. i'm very committed to this over the long-term. i feel like we are right in the middle of a very exciting project. the way this is structure suicide our senior management team and everybody at the company will stay. we will operate independently. we have a ten-year plan putting it together in terms of investing and although different sizes of the business. >> swref basos -- >> these meals are distracting. >> jeff basos kept his stake. did he tell you why? >> i think jeff basos is interested in the content business. we know with washington post, he is into that. it's been great to sort of be in the room with him on that and watch the inwroe vegas at the washington post, which has been great. he is just a wonderful investor. if he ever comes to you and said, look, i would like to invest in your company, take the

money. >> one question and answer it as honestly as you can. the reports we saw today nine times forward revenue. if you were analyzing this deal, would you find it expensive? >> i don't think that's correct. certainly not forward revenue. i think the axel springer said on the call six times forward revenue. there's no question this is right now based on current multiples a high multiple. on the other hand, if you believe in digitals future, you are going to have to pay a little forward if you want to take control of the company that is doing very well, and if we were a public company, you would expect to see a premium over where the stock was trading. we actually think it was a fair price and i will say on our board, there's a vigorous debate about whether we should think about it now because we really do. we're very confident in the future. >> you'll still come back, right? >> are you kidding? i love this. it's part of my reach. >> congratulations. >> thank you. >> henry blogitt, business insider. >> tim cook calls big screen

attempts to immortalize his predecessor as opportunistic. oscar winner aaron so rkin disagrees. first, rick santelli, what are you watching? >> i'm watching the markets. i'm watching ten-year notes get ever closer to that comp from the 25th of august where we settled much lowers to 2%. is 2% in the cards? well, what we're going to talk about may give you clues to that. i personally think the training wheels are off. what do i mean by that? show up after the break. it may surprise you.

>> coming up, carl icahn says danger is just ahead. we'll have more from my conversation on the billionaire investor. plus, is professor jeremy seagull agreeing with mr mr. icahn's warnings, or does he still see dow 20,000? we'll ask him. plus, valiant shares caught in the crosshairs of the big biotech collapse. can this hedge fund darling turn it around? we'll discuss that and a whole lot more in about 15 minutes. >> all right. sounds good. thanks, scott. meanwhile, aaron sorkin's wrup coming steve jobs film is expected to be a different take on his life focussing more on his personality and close relationships. with more films on the tech icon entering the fray, current apple ceo tim cook has called those efforts opportunistic. sorkin says, though, that is not

the case with his. >> tim cook has called these kind of films opportunistic. what's your kind of response to that? >> it's not opportunistic. tim cook hasn't seen the film yet or hadn't when he made that comment on colbert. nobody signed up for this movie to get rich. it's just not that kind of movie. i hope that when tim cook sees it, he enjoys it as much as i enjoy his products. >> tim cook had told steven colbert he hasn't seen any of the steve jobs movies because he prefers his own memory of the legend. he said apple is not in a position to make comments about being opportunistic because they have chinese children assembling their phones.

very few people, safe, to like sorkin's interpretation of their personality, but do you think there's something to this? >> i think the sorkinization of jobs. we saw it happen to zuckerberg. with steve jobs, he passed away. the people that are close to him, the -- this is intensely personal. also, got to say that the children in china thing seemed to me to be out of line. when you look at apple's actual record, read the documents that they posted on-line, the things that they've done to try to improve worker conditions, worker education in china, i mean, there are lots of other companies he could hit. probably not the best whered when he is trying to promote that film. that's my opinion. >> interesting to watch. meantime, let's get to the cme group and check in with rick santelli and get to the santelli exchange. >> hi, carl. you know, there was a time not that long ago where one of the phrases you heard often on cnbc was bad news is good news.

of course, we were describing the fundamentals much the u.s. economy/even the global economy, and the way the logic went was if things aren't great, the fed has to do more, stay longer, keep the training wheels on, and, of course, like pavlovian condition, the fed, just think about all the traders. i bump into a lot of programmers in this building. as a matter of fact, the cme in many circles is not even called an exchange anymore. it's called an i.t. company, and that's a good thing when you think about it. the i.t. people talk about how they program and just the word fed is a buzz word in some of these programs. those days are gone. if godfather ii was talking about the fed in the context i am going to, they would say, you know, the fed is dead to me now. i think the training wheels are off. here's what i'm saying. the u.s. economy and the global economy are now center stage. it's what's going to price, and i'm quite pleased. not necessarily at the direction of stocks, but i'm pretty

agnostic of directions of markets. my swrob is just to describe why the action is occurring or give you a heads up before it occurs. up down, all around really doesn't matter much to me, but i do think it's a wonderful thing. one of the issues that i wasn't happy about over the last five years was the fact that we weren't truly trading the economy. i think we are now. why? because i think that the magic or the glitter dust that the fed wanted the markets to believe was believable as long as many, like the carl icahn's of the world and the big hedge funds, were doing pretty well. whether it was qe. they did pretty well if you were a primary dealer. access to credit, the big and the mighty did very well. i know maybe the administration and the fed themselves don't like the comparisons out there by most, but pretty much many agree the top did pretty darn well. now whether they tighten, whether they don't tighten, i'm not saying that isn't important,

but i think that we are now going to look at the economy and the global economy for what it is. there's a technician. i'm not going to name his name. he is one of the best technicians i have ever seen in chicago, and big people paying big money to use him. he told me the fed has been toxic now. no matter what they give the markets, when the markets eat it, they're not going to like it. john, back to you. >> all right. thanks, rick. coming up, facebook now targeting tv dollars, making a major push for fewer ad products. a top facebook executive will be with us to explain on the other side of this break. at's a good , 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, insured by unitedhealthcare insurance company. like all standardized medicare supplement insurance plans, they could save you in out-of-pocket medical costs. call today to request a free decision guide.

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>> facebook making a big move to take on tv advertising for big tools for marketers unveiled this week. what does that mean? julia borstein sat down with facebook's vp of global marketing institutions in an exclusive interview. >> facebook wants a big piece of the $07 billion annual tv ad market, so it's embracing the metrics of tv. brands request buy ads based on nielsen target rating points. carolyn everson says make facebook ads an alternative to the 30 second spot. >> we wanted to enable them to buy and plan and measure in a way that they had been used to with television, and what we found is that facebook provides about 19.8% kremtal reach for television, and particularly, about 37% increase in reach, so

facebook and tv can be very complimentary, and, in fact, often it's actually more efficient to get that reach on facebook than it is television. >> facebook ads are safe, though the trend of ad blockers raises the bar for them and everyone. >> i think we should look at the bigger point of where there are ad blocker in the first place. we think that advertising needs to be more relevant for consumers, and the better it is for consumers, the better results there are for marketers. so instead of blocking ads, we would prefer to think about how do we deliver the most delightful, relevant useful ad to a person every single time they're experiencing it on facebook or instagram. >> everson is bullish on the explosion of mobile video saying it will help facebook compete on a whole new level for ad dollars this year. >> i believe we're at that tipping point with mobile video consumption. it's up 367% in the last handful

of years. there is more content choices available for consumers with streaming devices. television and non-mobile. what we're seeing is an ever-increasing appetite for sight, sound, and motion. it's a format consumers have always loved. it's a format marketers love, and i do believe we're at a tipping point for mobile video. >> advertisers, will you be stealing dollars for television or stealing from elsewhere? >> the way marketers think is really about optimization, and so we see budget shifting from a variety of places. sometimes it's shifting from traditional digital budget that is are now moving more aggressively into mobile. having said that, mobile spending from an advertiser's perspective is still way under represented when you consider the amount of time consumers are spending. >> e marketer projects $7.5 billion will be spent on digital video ads this year. guys, we have to remember that's still about 1/10th of the tv ad business. that means lots of opportunity and growth for facebook. >> mobile self-started a few years ago.

>> mobile growing and video as a piece of that growing even faster. >> great interview. thanks, julia. sonos is taking one more step into the connected home with a product called true play and a sonos play five smart speaker today. true play sounds and uses your phone's microphone to analyze how the sound reflects off walls in a room and then tunes the speakers so the music sounds its best for that exact room. kind of acoustics tuner. the software will be available using the sonos app and a feshl tone emitted by the speaker in both true play and play five are going to be out later this year. when we come back, quinton tarn tino, no fan of streaming video. we'll explain why in just a minute.

>> quinton tarantino said i am not excited about streaming at all. i like something hard and tangible in my hand, and i can't watch a movie on a laptop. i don't use netflix at all. he actually still takes movies

from television on to videotape. he bought i think a lot of inventory from the video store where he used to work, but will still roll physically on a program using a vcr or a dvd burner, i guess. >> get off his lawn. >> no, really. is that what it is? >> yes. >> he is going to start pulling his pants up complaining about the government? >> i guess he is kind of an old school guy. you see the way he shot his most recent movie. you know, lp's play a prominent role in his film. stroo you think this is like the same thing as people who collect vinyl? >> some people said to the degree he has children, they're going it use netflix, whether or not their dad watches netflix, although we do know he is a fan of cnbc, so we hope you're watching, quinton. meantime, the markets trying to hang in there. on the one hand you have the ten-year yield at lower levels which suggest further weakness, but oil, if cashin were here, is up almost $1. above $45. that's a sign at least it has

been recently that equities might hang in there. >> we have a one of three reading on consumer confidence too. the number put out by the conference board. that's the highest since january. you mentioned the second highest since 2007. we did see a slight downgrade to the august number, but still, i mean, incredible numbers out of consumer confidence going into a holiday season where that number is really the lead barometer. >> it's one of the days where at least tech stocks half are going higher. half are going lower. it's hard to draw any kind of comprehensible story line through all of it. i have to see how everything shapes up. over the last three months if you look at that, a lot of the china-related stocks, a lot of the high growth stocks have had a hard time. >> china, of course, lower growth prospect there. lower growth prospect in the u.s. and oil prices causing goldman to take down its target for the s&p to 2,000. that's still about 6% above where we are right now. >> yeah. and, of course, biotech getting the lion's share of the attention today.

vertex, biogeneral, bristol-myers which gets an upgrade over ubs and some others leading the charge after such a miserable performance by the biotech index yesterday. that's it for "squawk alley" on this tuesday. let's get to headquarters and "the half." ♪ >> thanks very much. let's meet our starting line-up. joe is here along with stephanie, josh brown, and pete. our game plan looks like this. biotech battleground. the valiant shares getting smacked in the settingor's big slide, is this hedge fund hotel about to crumble? we're going to ask a top analyst. the bullish professor with carl icon warning of more pain for investors. what is jeremy seagull think is ahead for the markets? we ask the professor live coming up. we do begin with the markets, and my conversation with billionaire investor carl icahn. warning, with that new video that danger is ahead and taking