thank you for being with us. congratulations on the new book. >> thank you very much. i brought you a pillow to remind you to sleep your way to the top. >> can that be used for any part of the body? >> any part. because there's nothing better for performance, including sexual performance. wasn't talking about that part. >> all right. thank you. we'll see you guys tomorrow. time for "squawk on the street." ♪ >> good tuesday morning. congratulations to the villanova wildcats and to jim. welcome to "squawk on the street." i'm carl quintanilla with jim cramer, david faber at the new york stock exchange. futures are weak, and if they hold up suggest the worst two-day decline for the dow since february.

a lot to focus on from those new treasury rules to disney to fed speak. europe in the red after unimpressive pmi numbers for march. we'll get ism services in an hour and oil not bouncing after kuwait says they still predict a production cut in doha. we begin with the new tax inversion rules threatening the pfizer and allergan deal. >> disney's heir apparent, the company's operating chief stepping down. who is next to lead? >> minneapolis president going after the big banks saying it's time to end too big to fail once and for all. >> but that wildcat victory, they're calling it maybe the best final ever. first for the wildcats since '85. chriskris jenkins, how do you not celebrate that shot. >> this is a moment you look at jay wright's team, they're a

bunch of kids who go to college and also play basketball. that's important. you don't go to villanova to play for the heat after a couple years of not taking classes. you go to nova, get a degree. some of the parents of the guys on the team, they went to school. and they also participate in the ncaa. that's what's exciting. jay wright visited our set. >> his face. >> his ice cold reaction there after jenkins sinks the three-point eer is unbelievable. >> he has built a team based on guys that jay likes who he thinks he can coach. not on guys who he thinks can play pro. even though unc was a great opponent, there's still a sense when you look -- i don't know if you watch the neutral or the pro nc -- you know, there were a bunch of broadcasts. >> i saw that. >> the neutral was pro unc because unc has filled the

stands with guys who play pro. nova really doesn't have anybody. you end up with this david versus goliath. jay has built a team in the way you want a company built. jay's a good ceo. >> you could watch that shot forever. but we have other business to tend to. there's a deal between pfizer and allergan -- >> i thought we were espn, sorry. >> that may be in significant danger. at 5:00 yesterday -- >> can we call it dead right now? i will if you will. >> i think it is -- i don't want to say that. >> why? >> because i've -- i -- years have taught me not to go to that final conclusion. >> dnr? >> very close. >> do not resuscitate? >> very close to dead with why? because of regulations announced by treasury at 5:00 yesterday that seem specifically designed to target this deal. i'm not talking about the other

things that kacame out, i'm speaking specifically about the look-back provision that treasury augmented having do with inversions that says you go back now three years, any deal you did in those three years leading up to the deal that you're going to be allowing pfizer to invert with, that being buying allergan don't count towards your size. suddenly you are reduced from being 44% of the overall company that will be combined, created, to less than 20%, hence you're a u.s. taxpayer and it's no longer an inversion. this is likely to doom this deal. a decision has yet to be made by either side. they are both, of course, examining it with teams of lawyers. they employ virtually every bank on wall street as well. many of them will have fees that they'll have to say good-bye to should the deal die. we could expect to see something or hear something perhaps as soon as the next day or two. maybe it takes them longer to

get there, reach a conclusion. a couple key thoughts. one is many people told me in the last -- since this came out, this is an overreach by treasury. there is little you can do about it. in order to sue you need to have standing. in order to have standing you have to close the deal. you can't close this deal if you're pfizer. allergan shareholders need to vote on it. there's no way they'll give you a yes vote on a deal where you're undertaking four to five years of litigation uncertainty while you're fighting the u.s. government. not going to happen. so you're then left with pfizer may still want to buy allergan, because it's not just about taxes, it's about other benefits they see from the combination. but if that was the case, they would want to pay less because they no longer would be able to get the tax benefits of an inversion, namely access to the overseas cash and the ability to bring it back to the u.s. without paying additional taxes on it. that would no longer be the case. you would want a renegotiation. what am i hearing from people

familiar with the situation? that's not going to happen. allergan not interested in renegotiation. so you're left with this. which is this very much targeted regulation that seems designed to kill this deal and the fact that both side al sides will co that realization. >> let's find out what you're going to do if you're allergan. huge hedge fund holding. allergan trade the at 299 on average basis. 299 basis. i've been after brent saunders to break this deal, i felt the company had ebita growth of 12% to 13%. they'll get $40 billion from teva. >> that deal closes. >> not impacted. >> neither is allergan as an inversion, we should make sure people understand that is an inverted company that remains a non-u.s. taxpayer. that's not in question. >> if you look at the j & j

multiple, merck's multiple, you get the $280. if you throw in bristol-myers, you have a price of about 350 this company was doing incredibly well, where there were aspirational numbers for brent saunders. brent wanted to run the combined company clearly. i was desperate to get him to break the deal. i felt it capped him. >> at the same time you will never have a takeover premium in shares of allergan again. that's gone. >> allergan will be a buyer of companies. they have no debt. they'll pay cash. that's what brent will do. we can talk about valeant and how good valeant is doing, trying to buy it, can't, frozen, because of the teva deal. a lot of people feel the treasury is looking back and trying to destroy the structure of allergan, not true. but the deal --

>> but they were trying to destroy this deal in particular. that raises a broader question in terms of what treasury is doing and whether that will undermine treasury in the future. by seemingly overstepping the boundaries of what people expected. >> which makes people wonder if that's one reason why we're weaker today. >> i think oil. this. i think there's -- i have to tell you, the disney news. entertainment has been rallying. i find allergan and pfizer thought they were playing by the rules. i hear them move the goalpost, but you really hear this is another deal that the hedge funds were in. allergan was worth so much. it was -- look. it had 10% revenue growth. that's hard to find, right? that's revenue growth. i'm not talking about inversion tax growth. so, it was one of the cheapest stocks. >> yep. >> last time saunders was on i said why you are giving up? he said it's two plus two equals five.

>> the spread had been widening and widening. while this comes as a big shock to many hedge funds who will be suffering losses who were playing the deal, there was something -- the market knew something. even though many people never expected treasury go here. it had been a rumor. i discussed companies trying to build up in preparation for what they said was to be sold to a company that wanted to invert. nobody expected they would go there. >>he original thinking is they would go after serial inverters, those who were repeat offenders. >> but this idea of bulking yourself up to be the right size, carl, for a huge inversion. >> that was them. >> most people said how could they possibly do that? that's outside their ability to regulate. >> jack lew said repeatedly, now, congress, you have to act. >> he said over and over you couldn't do it. >> it's a temporary regulation also. it starts immediately, but it only lasts for three years.

>> i think it's unbelievable. when it came out, eamon javers had it, i said this is the stop pfizer/allergan regulation. this is what that was. i want to come back to the fact that the teva deal will be on. they'll get the $40 billion. >> one thing you have not talked about is pfizer what about that name? what happens there? there was a plan to break apart. do you move that up? >> if you value it like merck, it's going to be at 30. >> that's where it is. >> well -- 31. >> we have valeant news it la completed its review of its relationship with specialty pharmacy philidor. it has not found additional items that they say will require restatement and still intends to file that annual by april 29th. >> once again, i know the stock will be up. having followed these kinds of

investigations, when a company declares itself clean, that means nothing. okay? nothing. it's the s.e.c. that declares you're clean. they could say we looked at it up and down. we're good. do you think the s.e.c. cares at all? oh, so you guys sat around and you talked among yourselves, you got ackman there. you got some really good guys. you blessed it? okay, we'll leave it. that's the opposite of what happens. it's the opposite. the government does not care at all what your audit committee says. get a lawyer. >> fair point. >> get a lawyer on the committee. >> the key for valiant is to get the audited financials done, this maybe allows them to get it done, and get in the 10k out. if they don't get that done soon, they're getting in deeper trouble with their lenders. >> right. >> then you have the prospect of things people don't want to hear about. >> right. i don't want people at home to think the way it works is

self-regulation. we're not a self-regulation country. >> but they've been working on this for quite some time. the special committee of the board. we were waiting to hear it. it's not unimportant, is it? you think it's completely not important at all? >> i'm just saying that the reaction of, listen, we're all clear is different from a reaction which says, listen, we didn't find the need to restate beyond this. so you can go buy the stock, the s.e.c. doesn't take a company's word. they just don't. they call you. you see what outside counsel says. they try to come up with a release. this is the beginning of the process. that's what i'm saying. beginning, not the end. the government is like -- the government is not sitting around saying, hey, valeant says we're cool. i guess they're cool. it doesn't work like that. >> stock back to 30. >> well, valeant says they're

cool. >> when we come back, more on the management intrigue at disney. iger's number two leaving the company what do they do now? also silicon valley pioneer, evan williams, former ceo of twitter, a live and exclusive. we'll talk about twitter getting the nfl streaming rights. another look at the premarket. dow hasn't had a triple digit loss since march 8th but we're in line for one at the open. more "squawk on the street" in a minute. or stop to find a bathroom? cialis for daily use is approved to treat both erectile dysfunction and the 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, or adempas for pulmonary hypertension, as it may cause an unsafe drop in blood pressure. do not drink alcohol in excess. side effects may include headache, upset stomach, delayed backache or muscle ache. to avoid long-term injury, get medical help right away

for an erection lasting more than four hours. if you have any sudden decrease or loss in hearing or vision, or any symptoms of an allergic reaction, stop taking cialis and get medical help right away. ask your doctor about cialis and a $200 savings card

. some management intrigue at disney. the company announcing that long-time executive, lewis staggs, likely the favorite to succeed bob iger is leaving the company. he was elevated to coo last year. he has been with the company 26 years. 55 years old. comes not too long before shanghai opens which is another interesting wrinkle. >> i think people reach a conclusion that maybe something again is wrong at espn. a lot of times people want to know the answer. do i have the job or not? if the answer is maybe, that's not good enough. >> right. he's 55 years old. you could hang in there and fight. he clearly decided not to do

that. i don't know specifically what the board told him. i do know, this was in the "new york times" today as well. i can tell you also, the guy who used to run -- the guy who sold marvel. >> maybe one of the toughest people in america. >> he's not a fan of mr. staggs. he's not commenting publicly. i heard that. other reporters have heard that. i think he's the largest shareholder maybe after jobs. >> very successful businessman. tough guy. tends to get his way. >> apparently he's being listened to. again, i -- we don't know what specifically were the reservations on the part of either the board or a large shareholder. >> we don't know whether they wanted someone who is younger by the time he gets the job. >> now the speculation has started. cheryl sandberg is on that board. >> along with jack dorsey, john

chen, mark parker. it's a beautiful looking board. >> people are pointing to sheryl. the question is do they need a creative content person or a media technology person. >> just that chatter will send facebook down. she's extraordinary. you listened to conference calls, you know she's a multi talented individual viewed as great. >> ambitious, young would have to be considered in the small group of people fsh, if she's interested in it who has some experience. >> have you noticed where time warner is? back to 72? >> i have. >> that is the expansion on the earnings. >> yes. >> people at time warner -- jeff bui bukas is a great men, when the stock was at 60, he said it will get to 72. the entertainment group has come back. >> barron's over the weekend say

it could go up 25% in a year based on the batman/superman franchise. >> that seemed a little much. >> yeah. i don't know. >> i still think in the coming world the question as to whether you need to watch -- last night maybe you did need to watch tnt or tbs. >> villanova was on channel -- >> i had it on 3. but do you need them in a slimmer bundle? will they always be a part of it? jeff bukas, great american he is will say, of course, they're must haves. others will not. >> as long as you keep running shawshank and others, it will stop. >> they put it on right noushw,e three of us would stop doing the show and watch. >> absolutely. i don't care, remember? richard! >> disney says they will

evaluate a robust slate of candidates. there's always the chance that iger could stick around longer. stick around until he redstones it? could be like sumner redstone. >> i don't think so. into his 90s? i don't think so. that board of directors might do something. >> really? >> maybe into his 70s. 70 is the new 50. >> if iger were to take the a.c.t., he would get a 35, right? >> is that what the perfect score is? 36? >> i only took the s.a.t. >> everybody takes the a.c.t. now. >> i know. >> is that easier? >> moving into that world soon. >> are you? >> get a tutor. i got a tutor for you. >> all right. >> it's like an arms race. >> you have to start in seventh grade. is your kid in seventh grade. >> oh, my god, you don't have a tutor yet? you start tutoring them when you're -- >> i'm a purist. >> it's only 500 bucks an hour

in new york, right? >> paul weiss is 2,000. get paul weiss as your tutor. >> especially if they're paying that new m&a guy. when we come back, cramer's mad dash, a countdown to the opening bell. we'll walk you through some of the reasons we have not gotten to as to why we're seeing weakness.

six and a half minutes until the opening bell on a tuesday. you want to talk tesla. >> the shorts want tesla down. when tesla says it can make 1,180 fewer cars than the company expected, the shorts come in. be careful if you're shorting

this stock. in the end, this is one of those animal spirited stocks that is based on the deposits and the interest in the cheaper car. so, this is a little bit of a -- well, wait a second, if they can't make this car, how will they produce all the cars that you need to be able to meet demand. all i can tell you is musk is mr. rabbit out of a hat. and, yes, the stock is impossible to value. amazon was impossible, tesla was impossible. i don't know how to value it. it's a conumdrum. >> it's wrapped in a riddle. >> you're right. it's wrapped in fury signifying nothing. it doesn't matter. people say, listen, they can't make this. how can they meet -- the answer is it doesn't matter. the buyers want the car. they want the stock. >> as long as people keep lining up to put deposits down, the stock doesn't have that much downside? >> i think that the stock is buoyed by the number of people who love the car, like people

who love netflix and love amazon prime. these -- when you deal with -- let's say you're ford. ford puts out something saying listen, we have demand for 200,000 lincolns, we can only make 50,000. people say what a bunch of losers. tesla says they have demand for x, they can only makes one x, winners. this is like a mark fields day. >> we have to get this show on the road a bit. maybe we can do it from the giga factory? >> no, do it from the six building in brooklyn. you and i will go. >> they're not making anything there. that's just a showroom. i want to go where they're making these batteries. that's got to be incredible. >> that's on mars, isn't it? >> no. >> people didn't like i said that elon musk thinks people are simulations. all night my wife kept saying david is clearly a simulation. >> i'm a simulation? >> yeah. you're a simulation, in my mind.

ow, elon musk believes people are simulations. >> we'll keep stimulating here on "squawk on the street" whether we're real or not. we have the opening bell coming up after this. great time for a shiny floor wax, no? not if you just put the finishing touches

on your latest masterpiece. timing's important. comcast business knows that. that's why you can schedule an installation at a time that works for you. even late at night, or on the weekend, if that's what you need. because you have enough to worry about. i did not see that coming. don't deal with disruptions. get better internet installed on your schedule. comcast business. built for business. steve, other than making i'm here atme move stuff,rade trader offices. what are you working on? let me show you. okay. our thinkorswim trading platform aggregates all the options data you need in one place and lets you visualize that information for any options series. okay, cool. hang on a second. you can even see the anticipated range of a stock expecting earnings. impressive... what's up, tim. td ameritrade. i built my business with passion.

but i keep it growing by making every dollar count. that's why i have the spark cash card from capital one. i earn unlimited 2% cash back on everything i buy for my studio. ♪ and that unlimited 2% cash back from spark means thousands of dollars each year going back into my business... that's huge for my bottom line. what's in your wallet?

you're watching "squawk on the street." the opening bell in 60 seconds. a lot going on in today. we have leggard saying the risk of low growth continues. here is lagarde. we're not in a crisis, the not so good news is the recovery remains too slow, too fragile and risks to its durability are increasing. >> she said don't raise. i think the numbers were not all that bad out of europe. the european recovery started a year ago. it's been worse than ours.

we always hear people say our recovery is the worst. >> dollar strength not helping matters. >> no. >> oil stubbornly refusing to reverse its loss last week. >> oil has to go higher. when it got to 40, there was a flood of oil that came out. then what you need is this april 17 meeting. you need countries that -- we got one, countries come out saying it's significant. but iran did produce more oil last month. that's been missing from the equation. i keep thinking about chazen. that was an amazing interview, where he said, listen, we're not buying these companies. >> very interesting. >> they're not good. >> not paying -- they got $80 oil coming out of the ground, why would i be interested? >> i don't know whether people recognize when mr. chazen comes on our show and says we're not going to buy it. the world is praying he will buy someone. he's like, what? what is with you guys? why should i do that?

>> weak at the opening. at the big board, the pure funds etf and the pure funds drone strategy etf. at the nasdaq, hts. speaking of sports, we have not gotten to twitter yet. the announcement with nfl, streaming rights to ten thursday night football games which will be broadcast by nbc and cbs and simulcast on nfl network. periscope broadcasts from players, live streaming video without authentication to 800 million users. >> look at the cfo of the nfl, presumably behind the scenes he did this. i think it's monumental. it's also kind of like how much did they pay? >> terms not disclosed that i've seen. >> it's a material event. how do you not disclose the terms? how does that work?

>> i don't know why you wouldn't. i would assume it's not cheap. >> they should put that release -- jack is talking like his dad. i said, jack that means your dad knows how to get on twitter, which is really good for the older -- the elderly who told me they can't get on. they should -- jack's dad can get on. what am i missing? >> so you're going to watch -- >> in 140 characters. >> wow. >> jack's dad, by the way, @time535353. >> that's one of those hard ones. >> he's good guy. >> really? how about adam bains dad? is he on? >> baines tweeting, goodell tweeting. >> i think it's great. >> you are kidding? if you're the nfl, you're loving this, it's another way to monetize your product. >> yes. the one thing that's wrong, can i just say, i will say it point

blank, i hate the thursday games. they're all really tired. did you ever watch them? these guys, they can't play thursdays. those thursday games are awful. i hate them -- i never play them for fantasy. still doing that draftkings, david? how you are doing on fanduel? >> they outlawed it in new york. >> darden we have not done. comps up 6.2. jeff smith leaving as chair. 121, beats by two cents. using tablets to close out the checks some seven minutes earlier on average. >> i thought the darden quarter was great. i think that smith stepping down is regarded as being a big negative. he did so much. i don't think he should. i think you should buy darden. darden down a couple bucks on those comp numbers. deflation throughout the food chain, it's a good number. i like deflation, people should buy darden. >> has there been a cleaner activist entry and exit than this one? at least from a managerial

standpoint? >> this one went very well for them. don't forget they had an easy battle on their hands. it was extraordinary they were able to get rid of the entire board of directors. that's not happened often. i can remember only one other time something like that has happened. you're right. timing was good in terms of oil prices went their way. gasoline which helped. >> beef. >> installing the new management. you had a management team not well liked by shareholder base. >> and red lobster gone. the seafood hater in me. i think olive garden, once you put your mind to it -- anybody who goes to olive garden, you know you can't cut in line. the line is ridiculous. >> right. yeah. this does -- i don't know what the provisions were, when you step off, it may allow them to potentially start thinking about selling some of their stake. not that they are going to. i don't know. you have to remember that when you see the activists on board.

>> that makes a ton of sense about why it would be down. >> yeah. so he's no longer chairman. >> all i can say, yes. it was a remarkable turn. and how is that yahoo! thing going, dave? the proxy? >> the proxy fight against jeff smith? >> yeah. >> how are they doing? >> which side? >> the -- the starboard guys at yahoo!? doing well? >> it's just starting the proxy fight. >> what are you hearing? >> i'm hearing that we'll see. i think they would probably be happy if there was settlement. >> that's what i'm hearing. i'm glad you brought it up. couple guys put on the board. >> we'll see. they nominated nine guys? by the way, on yahoo, the sale of the core business probably got a couple of weeks until we get any sense as to even first round bids. >> i'm sorry to pressure you on

this, but we don't talk ahead of time. >> this is our show. what else? anything else? the weather today going to be very cold. >> no, not focused as much on the weather as i am on traffic. >> i don't know about traffic. i'll check google maps. >> my point is are there any talks behind the scenes that could make it so a compromise could be reached? >> yes. but also you could have yahoo announce something prior to the shareholder vote. so it would sort of make it moot. >> anything from verizon? >> he's pushing for them to sell the core business. they may actually do that before his board members come up for a vote. >> because alibaba has been coming back. >> yeah. >> so yahoo, 52-week high. there's a lot going on here. a lot. i think alibaba is making a comeback. >> you do? >> yes. >> why do you think that? >> consumer in china doing better. remember, we used to come in here and talk about the chinese. >> yes. >> it goes up -- baltic freight goes up again last night.

when china goes down, we're like, eh, oh oh. when china -- that's a reference to one of my idols, soupy sales. when china goes up -- >> we mentioned food and dri. we do have initiation of starbucks and wendy's out of evercore with a buy. they see starbucks net in china 2x by 2020. >> starbucks in china, my travel trust owns that howard schultz, meeting with chinese officials yesterday. they love the fact -- everybody loves the fact when howard schultz went over to china, he met with the parents of the baris baristas. he has the zeitgeist. stock stuck at 50. i think it's biding its time. >> on wendy's, a lot written of wendy's ability to leverage

value pricing better than some rivals, maybe better than mcdonald's. >> i went into wendy's for that value. geez, it's good. $4, impressive. >> what did you eat? >> i had some great port bell low mushroom -- a vegetarian burger. >> really? >> killer. i told my kids i had it. i thought it was fabulous. you had no idea it was beans, bean burger it was really good. no one believes me. >> we're hearing fr10 million f the entire ten-game package via re-code. >> 10 million? >> that's more like 10 billion. i told you the thursday games are awful. that's all? >> yeah. >> did want to come back to allergan, the stock down about 15%. but that is off the lows that we saw in the trading that took place last night where the stock was down over $50.

>> it was up nine yesterday. >> still down $41 to 2.36. to refresh on that, seems highly likely this deal is not going to continue. that it will be -- it will -- it will be appregated. there might be a fight over here, a fight to a certain extent about break fee. i don't want to get -- we're not there yet. they're still trying to figure it out. still conceivably a few days ahead of them of looking at every possible angle from a legal perspective. a tax perspective. but it will be tough for them. >> i can tell them they can stop looking. >> $3.5 billion payment to allergan if they were no longer still the combination -- >> how much? >> 3.5 billion still not to be considered a u.s. taxpayer. if it was even an 80/20 deal for the inversion. doesn't appear likely it is

going to be. >> so 40 billion from teva. clean balance sheet from allergan. next thing is a cash buy from a company, valuations have come down a lot by other companies, brent saunders who is gunning for valeant in the ophthalmological and dermatological. the libido pill from valeant -- >> didn't do well. >> i wouldn't know, but it didn't work. >> i got nothing. >> you guys? no? no? >> time to go to bob? >> yeah. this might be a really good time to go to bob. >> yes. >> bob is on the floor. dow is down 108. disney almost the worst performer. hey, bob. >> a big crowd next to allergan as it opened down 15%. broad market weakness and global reasons why we're weak today. let's look at the reasons. we have not seen a weak open in a while. number one, that yen strength. we had problems over in japan. i think that spilled over.

that's my number one reason why we're weak today. also talking about christine legarde warning on slowing growth. the german factory orders came in at a six-month low. i think that was a surprise. and then just the eurozone, weak service sectors. germany, france, spain, all to the down side, roughly about 2%. germany notably weak here. put up the european markets. germany down about 10% so far this year. you can see the whole market in europe down about 2%. we have that strong yen. the yen hit a 52-week high against the dollar. 110 and change. saw japan weak on that. down about 2.5%. oddly china had a good day. china has been moving in different directions recently. we had positive pmi data last week. another issue is the waning commodity rally. oil hit a high of $41 on march

21st. as the dollar stopped going down, the dollar stopped going down that day, the trend in oil has been to the down side. now we're at 35. we're down more than 10% since the high on march 21st say with the rest of the commodity. copper topped out march 21st, 2.29, 2.30. down 7% or so in the last three weeks. all this is affecting our stock market, energy stocks have been on a slow decline as well. again, around march 21st oil stocks topped out. this is the xle, the etf for energy. down about 5% since that march 21st high. commodity stocks generally weaker today. anadarko, freeport just turned positi positive, mosaic down about 1%. weakness in banks, bond yields have remained well below 2%. 1.7% or so. that, again s spilling over into

the banks today. the big monster banks to the down side. european banks weak. si similar situation in europe mimicking to what's going on here. you throw in the curveball on inversions from the treasury department. in addition to allergan being weak, most of the pharmaceutical stocks also opened to the down side a bit here. biotech etf opened to the down side and is now in the last three, four minutes moved to the upside. some impact from pharmaceuticals, some impact from weakness in the bank stocks. ongoing impact from weakness in energy stocks and material stocks. it's not one thing that is causing a bit of market weakness today. it's a conglomeration, and weak global growth the main driver of all of that guys? >> bob, thank you very much. bob pisani. the ten-year, 1.72. let's get to rick santelli in chicago. rick? >> you know, no matter how you

enjoy flattening, we see it in so many different combinations of late, that's telling. yesterday rates flattened because short rates were higher. today the curve is flattening because all rates are lower, but the long end is racing lower faster. let's look at some comps. let's start out with the short end. two-year, haven't seen these yields since a couple days after valentines day. pay attention to that. february 25th, at 1.17. if there's one maturity to pay close attention to. the five-year is the one you should be looking at the closest. february 25th is the same day for the ten-year comp as referenced by carl at 1.17. excuse me, 1.72. remember, we closed at 2.27 at the end of last year. the winner, the furthest back comp is the 30-year bond. long end of the curve driving, flattening today. if you look at the comps, we have not been at these levels, all that is based on closing levels. closing yields.

haven't been there since february 11th. now, let's look at the relative value trade from a different perspective. let's look at it from the european side. bund yields, well, let's start the chart at april of 2015. because it was around april 20th they had the lowest yield close ever at 7 basis points. coming very close today as you see on the chart getting down around 8 basis points before moving up one basis point. now foreign exchange. this is the great diviner of all policies in many ways. it can be kind of moved around a bit. seems ironic central banks are doing their darnedest to keep rates low. when the global economy is doing it for them, isn't it? look at the dollar yen. we have not been down here since october of 2014. i showed this chart a lot. maybe more interesting is the euro versus the yen. now, we do have that one spike you see on the chart. this chart starts the last time we were roughly down here. that was tax time of 2013.

briefly, briefly in february we were at 122.53 on a closing basis. today the intraday low is 125.28. to give you some idea how close we're getting to these very historic comps. carl, back to you. >> all right, rick santelli in chicago, thank you. when we come back, a lot more on this twitter/nfl news. later on, calling for a breakup of the banks, fed governor neel kashkari on closing bell today at 3:00 p.m. dow down 129.

twitter announcing the streaming partnership with the nfl this morning. julia boorstin spoke with the cfo and joins us with details. big news. >> that's right. really big news, it's worth noting that anthony noto was previously the cfo of the nfl. he says this speaks to twitter's

commitment to focus on live content. he also said this -- that twitter is helping the nfl and its broadcast partners reach twitter's younger demographic, that might not be actually paying for tv. he said it is a way to communicate the value of twitter to new users. twitter is hoping this will grow its base, a number the company has been struggling to grow and has been weighing on the company's stock. it could also help the company generate more revenue from the 500 million people who see tweets without logging in. noto wouldn't comment on the terms of the deal but a source tells me that the cost of the deal is reasonable and for all ten games twitter will be paying much less than the $20 millions that yahoo! paid for an exclusive stream of just one game. now, why would twitter be paying less? not only is this deal not exclusive, thes will show the my

of nbc and cbs' ads. the big question now is whether people who watch the game on twitter will see value logging in and using the service the rest of the time. guys? >> julia, this is jim. anthony noto's relationship with the nfl what did that give them? i know anthony for many, many years. it's some of insight why he did that deal versus facebook and google. >> twitter and the nfl have had a partnership for a while. not around the content of the game itself, but more in the conversation around the game. so because of noto's relationship with so many folks at the nfl, they've been able to work together and drive conversation about the game, which, of course, people tune in on television for the nfl and gets more activity on twitter.

the goal of the partnership has been more of a win-win in conversation about the game. this conversation this morning takes that deal to the next level. they're interested in live, nothing is more compelling thin live television than sports, so having this content on twitter in addition to television could potentially help. noto has those strong relationships at the nfl and has maintained them while at twitter. >> if you want to go broad, you want live, you want live sports, but in the end, it's the nfl. >> they want china. they want china. that's the key for the next level of growth. that's why they play those games in london at weird times. >> up next, stop trading with jim.

we need to be ready for whatever weather may come our way. my name's scott strenfel and i'm a meteorologist at pg&e. we make sure that our crews as well as our customers are prepared to how weather may impact their energy. so every single day we're monitoring the weather, and when storm events arise our forecast get crews out ahead of the storm to minimize any outages. during storm season we want our customers to be ready and stay safe. learn how you can be prepared at pge.com/beprepared. together, we're building a better california.

great time for a shiny floor wax, no? not if you just put the finishing touches on your latest masterpiece. timing's important. comcast business knows that. that's why you can schedule an installation at a time that works for you. even late at night, or on the weekend, if that's what you need. because you have enough to worry about. i did not see that coming. don't deal with disruptions. get better internet installed on your schedule. comcast business. built for business. time for cramer and stop trading. >> this poulte home, it looks like he didn't buy enough land

do during the downturn. horton has done much better, but toll hasn't done better than pulte. it's an inquisitive series of deals. >> had the centex deal that didn't go well. >> they bought centex at the peak. >> it was after the crash, but still not -- >> i wasn't even buying homes during that period. that was a -- that was little window. >> between pearson, staggs, there's a lot of management intrigue going on. >> by corn ferry, they do recruiting of ceos. i was shocked at this. the guy is a fixture in homebuilding. he used to come on constantly. the family didn't like him. just -- family didn't like him. see you later. >> what's on "mad" tonight? >> villanova. no. >> i believe you. >> no. we'll find -- i have the one company that has managed to beat

mcdonald's. one. that's all there is. one. >> that's a tease. >> that's a tease. we'll see you tonight at 6:00 p.m. when we come back, the co-founder and former ceo of twitter, evan williams. back in a minute.

good tuesday morning. welcome back so "squawk on the street." i'm carl quintanilla with sara eisen, simon hobbs, david faber at the new york stock exchange. people wondering if this is the moment the market is making a turn. down about 85 points, on track for the worst two-day loss for the dow since the end of february. getting some macro at moment. ism services. for that we turn to rick santell santelli. >> nonmanufacturing services sector, looking for a number in the neighborhood of 54.5, 54.2. we got the high side, 54.5. this is a good number. it's the best number since

actually just the end of last year in december when it was 55.8. but the good aspect of this number is we reverse the two-year trend. the unrevised look at february at 53.4 represented a two-year low read going to february of 2014. so this reversed that. let's look at new orders, shall we? they moved up from 55.5 to 56.7. employment moved over 50 into expansionary mode to 50.3. i would like to see this stronger, but also keep in mind it has not been under 50 on the headline number basically since january of 2010. now we're also looking for jolts to come out if it moves markets we'll get back to you. david faber, back to you. >> thank you very much, mr. santelli. well, yesterday at about 5:00 the treasury of the united states dealt a body blow to one of the largest deals

contemplated or signed that is pfizer's planned acquisition of allergan. treasury regulations issued yesterday and take effect immediately, the treasury aimed, it seems, though they differ on this, specifically at trying to end pfizer's ability to buy allergan in what would be a so-called inversion. in other words, a deal making pfizer no longer a u.s. taxpayer. why? because of a three-year look back provision that is part of the new regulations dealing with inversions that would effectively reduce the size of allergan to a point where given the deals it's done over the last three years, they would no longer be counted as part of its size. it would reduce it to the point where the deal would no longer qualify as an inversion and hence it does appear n speaking to people familiar with the situation on both sides, that this deal is likely to be dead.

now, that is not yet a conclusion that has been come to by either side. they are having teams of lawyers and accountants reviewing regulations from treasury. nonetheless it appears the likely outcome. even though many people believe treasury is overreaching here, there had been, remember, regulations that came out last november around the time that the deal was announced that appeared to be the last effort from treasury and didn't derail the deal at all. this is that third wave of actions against inversions. it does take aims at earnings stripping, but it's the serial inverters, specifically aimed at allergan and pfizer which had not been in any way, shape or form expected by the two companies. it does, as i said, put the deal in grave jeopardy. and that is because even though, as i said, it's seen as a potential overreach by treasury, in order to challenge it, you would have to close the deal to have standing to sue. that does not appear to be

something either company would be willing to do or undertake given the uncertainty that would take place in terms of litigation that would go on for many years, and you're unlikely to get an allergan shareholder in favor of the deal. while pfizer might see other benefits from the deal beyond its ability to no longer be a u.s. taxpayer, it's probably not willing to pay the same price for those benefits should they no longer be a part of doing a deal with allergan. allergan for its part, according to people familiar with the situation, not interested in negotiating a price lower. allergan shares down over 15% and people awaiting an announcement in the next day or few days from both companies saying we can no longer follow through on the deal. let's get more on the overall deal and the fallout. let's bring in a pharma analyst

at citi. nice to have you on set. >> good morning. >> let's start with the conclusion that it's likely both companies will remain independent. what does it mean for the future of either one of them? >> i think from an allergan perspective we need to think about this company as a stand-alone entity what does stand-alone allergan look like and the same for pfizer? i think the fallout and the decline in share price that you see in allergan today reflects investor concerns regarding the transaction and investors thinking about the future of allergan as a stand-alone entity. >> let's assume that it's likely -- no conclusion yet that the deal no longer goes ahead -- allergan is not going to be a perspective merger combination for anybody. but it will have the ability in closing the teva deal, have a lot of cash, and as an inverted company will be in an

advantageous position to continue to acquire. is that something you would expect? the management of allergan is a shareholder friendly management team. one can assume they will continue do what is best for shareholders. as you said, they are about to get large chunk of cash from the sale of the generics business to teva. it is likely that they will either engage in additional acquisitions or do other shareholder friendly measures, such as share repurchase. >> liav, for people who wanted the tax inversion stopped, this has been a long time coming. this is now the third incarnation, maybe the fourth incarnation. can you give us some color as to that? what's going on during that period of time and the deals that maybe haven't been done because they thought something bigger was coming? is it correct to say this is aimed squarely at pfizer deal or more broad from your interpretation?

>> it is aimed squarely at pfizer transaction bus there are other more broad ramifications here that will affect additional transactions going forward. companies will have to consider those. it will also affect transactions which have been undertaken because of some other implications of the rules that have been set forth, particularly as it deals with earnings stripping. will we see effective tax rates across these companies that have already inverted? will we see tax rates going up? potential downside to earnings? >> is it your belief this can be challenged in the courts? >> this could be challenged in the courts. as you mentioned, this will impa impact uncertainty surrounding those stocks that are affected. this is a process, if challenged, will take many years to unfold. it's unclear whether management will want to go through that. >> they'll not want to take that

kind of litigation risk. >> unlikely. >> seems highly unlikely. your opinion on pfizer here. they've been searching for an inversion, it was astrazeneca for a while, bad talks with activists, which became allergan. they got the deal done. now ian reed has to go back to the drawing board, it would seem. >> it would seem so, and the chance for pfizer to engage in an inversion transaction would be limited. we'll have to wait for potential legislation in order to address tax issues. >> before pfizer's ce launched this offer, he said he was driven to do deals because the tax system as it exists disadvantaged american pharmaceutical companies. is it your belief f these changes hold, that u.s. pharmaceutical companies will be disadvantaged? will it affect research and development budgets. >> i think it's a broader question than that.

the u.s. tax system in general disadvantages corporates in the u.s. because of the different tax rates in the u.s. versus overseas what companies such as pfizer and others before it were trying to deal in he'll arbitrage. that's fair given the current construct. this needs to be addressed by congress. unlikely to be done in this administration but something that needs to be addressed. >> thank you for joining us, appreciate it. a big shakeup at disney today. thomas staggs, the company's number two, stepping down. julia boorstin has the latest on that. two big stories on your beat. >> very busy morning here, carl. certainly a surprise to hollywood insiders and disney i investors to learn that tom staggs is steps down on may 6th. by all accounts staggs was

positioned to take over for iger when he was appointed ceo in february of last year. he had been cfo for a dozen years, was well liked by wall street, then he ran disney's parks and resorts operation for five years, overseeing the high-tech wrist bands, laying the ground work for the launch of disney shanghai. what happened? it had been a year since staggs took on the coo role and a course says disney's board was not ready to assure him that he would be iger's successor in two years. without that guarantee and with the board wanting to explore other options, my source says it didn't make sense for staggs to stay. while staggs had extensive financial and management expertise, his lack of creative experience raised questions of whether he had the creative chops to keep the media conglomerate innovating. while staggs started off in strategic planning, by contrast, bob iger ran abc.

disney says the board of directors will broaden the scope of its succession planning process to identify and evaluate a robust slate of candidates for consideration. disney has no plans to name a new coo. guys? >> julia, could it be that bob iger is tending to up again any way and until they're clear he won't do that, they'll say -- a lot of the bulls would like to stick with iger, wouldn't they? >> well, it seems like if disney were going to do that, they would have said it outright it would have been easier on the stock. disney tells me on the record this is not about a plan to extend iger's contract. that is not what was intended here. having said that they have not ruled out they could potentially extend iger's contract in talking to hollywood insiders here, i am hearing that seems likely and there are folks who could potentially succeed him

and need more time, and that could be something they could do. they could give him another year or two. iger still is relatively young. he's 65, which at one point was considered retirement age but he seems like a robust 65. he's said he's stepping down in two years in june, by then he'll be 67. maybe they'll add on a year or two more after that. they certainly have not said that that's their intention at this point. >> julia, thank you. disney shares down about 1.5%. after the break, a rare and exclusive interview with the co-founder of twitter and blogging site medium, evan williams will be joining us. man 1: you're new.

man 2: i am. woman: ex-military? man 2: four tours. woman: you worked with computers? man 2: that's classified, ma'am. man 1: but you're job was network security? man 2: that's classified, sir. woman: let's cut to the chase, here... man 1: what's you're assessment of our security? man 2: [ gasps ] porous. woman: porous? man 2: the old solutions aren't working. man 2: the world has changed. man 1: meaning? man 2: it's not just security. it's defense. it's not just security. it's defense. bae systems.

the ad age conference is underway in new york where kayla tausche has a special guest. >> thank you very much. we are joined by evan williams who founded blogger, twitter, and now medium, the latest content site taking the internet by storm. ev, thank you for joining us. >> thanks for having me. >> you were doing content before it was cool for everybody to get into the content game. this morning you're making a few announcements about medium going forward. new partnerships for publishers and for people who want more prominent placement on the site. why is this the next best step for medium. >> we're launching medium for publishers, really a new set of

suites or services for commercial publishers and brands. both of which have been on the site for a while. but we have not had any ability to monetize. we also enchanced the ability to really create a brand and create something that is more distinct site on medium. so it adds on what is already going on on medium which is individual individuals who bub lish on a regular basis. >> what made medium so distinct, the clean design, ability to highlight. will this make it less differentiated from other platforms? >> i don't think so we're approaching the stuff the same way we have with everything, cleanliness and simplicity are important. and we think we can create a symbiotic relationship. when brand content shows up, it will feel like medium content. it will be labeled if it's promoted story, but it will all be integrated and seamless.

that is an experience consumers will like. it will be more effective that way. >> do you see an increase in the number of players that are age to get people to create not only content but really good content? it feels like there are fewer barriers to entry with the likes of tumblr, linkedin, facebook making its platform more attractive for longer posts. what do you see on the landscape? >> i lot of people realize in order to pay attention to something, you can't tax a user experience or other content, just put ads around it. it doesn't work well. the goal is to create something that people choose to consume. you have to do that but add value, create something original. that is driving a major trend it works when it's done well. i don't think it will work well for all brands.

you have to have a high level of skill do it, but it's effective when it works. >> a few months ago we saw yahoo! write don't value of its tumblr acquisition? was that a black eye for content? i think tumblr is a unique property. i don't have a lot of insights into that that are not public insights. it's interesting because it's very different medium, even though functionally they're similar. you can publish, follow things. obviously what happened on yahoo! is a lot of visual content as opposed to bigger long-form content. so i think it's pretty unique. >> would you categorize it as a viable competitor to what medium is doing? >> it's a -- i would not say it's a direct competitor at all. there's not a lot of -- medium thrive force people who want to tell stories in words and pictures combined. and it's less about memes, short

content and long content. they're very different audiences. >> is there future for medium in video? >> yes, certainly. you can embed video today. there's a lot of posts that include video. we can see ourselves doing more of that in the future. >> that's a big push for twitter, another company you are familiar with. today we got confirmation from the commissioner of the nfl that twitter will be hosting thursday night football games. how will that work? >> it will be pretty exciting. it plays off the fact that everything -- twitter is about live. so to be able to watch the game live within twitter and twitter integrated experience is going to enhance what many people experience already. when you watch a live event, there are tweets alongside. having that more integrated is an extension. >> that is the most popular

content in this country. is that the beginning of twitter users paying for content? the nfl? >> this is not. no comment on whether or not twitter users will be paying for content. this is an extension of what we've already done and just making it better. >> you are still the largest shareholder in twitter, 6% stake individually. you're on the board. but i looked at medium today there was a post about twitter's ad and growth strategy being flawed. your worlds are converging here. what do you think when you see something like that? i usually read it and see if there's anything valuable in there that we can learn from. that just shows that i don't editorialize what shows up on medium for the most part and when people like to talk about twitter a lot, there's a lot of ideas out there about twitter. most do not contain a lot of

knowledge about what's going on. hard to pay attention to all of them. >> you made comments about the web for publishing being on its way out. people were scratching their head because someone who has been so instrumental in creating the ways that we share information online, making comments like that. could you clarify what you meant? >> what i was trying to say is stand-alone websites will be harder and harder to justify as the place to publish. meaning whether you're doing it for self expression or commercial purposes or as a media company, getting someone to come to a website -- today i talked about people showing up at a shop on the side of the road. for better or for worse, this is the world we're going into. publishing platform that has built-in distribution and feedback will be more efficient. what we're trying to do at

medium is enable the best of both worlds. you can have a website with its own domain, design. >> medium is just a couple years old as far as we know it in the public eye. what will it look like in five years? >> definitely significantly different. we feel like we're just getting started. there's a whole bunch of stuff we want to do in terms of enabling content creation. we have ideas around -- you mentioned video. there's perhaps different types of media. but we're -- the philosophy will stay the same. it will stay very simple, very content focused. just with more diversity. >> always a treat to talk to you and hear your insights. appreciate your time. >> my pleasure. >> evan williams, ceo of medium. >> kayla, thank you very much. we'll see you soon. minneapolis fed president

and former senior treasury official neel kashkari is in full force right now to end too big to fail a discussion on the future of big banks coming up after the break. and don't miss mr. kashkari himself joining "closing bell" later on. you may think you can put off checking out your medicare options until you're sixty-five, but now is a good time to get the ball rolling. keep in mind, medicare only covers about eighty percent of part b medical costs. the rest is up to you. that's where aarp medicare supplement insurance plans insured by unitedhealthcare insurance company come in. like all standardized medicare supplement insurance plans, they could help pay some of what medicare doesn't, saving you in out-of-pocket medical costs.

you've learned that taking informed steps along the way really makes a difference later. that's what it means to go long™. call now and request this free decision guide. it's full of information on medicare and the range of aarp medicare supplement plans to choose from based on your needs and budget. all plans like these let you choose any doctor or hospital that accepts medicare patients, and there are no network restrictions. unitedhealthcare insurance company has over thirty years experience and the commitment to roll along with you, keeping you on course. so call now and discover how an aarp medicare supplement plan could go long™ for you. these are the only medicare supplement insurance plans endorsed by aarp, an organization serving the needs of people 50 and over for generations. plus, nine out of ten plan members surveyed say they would recommend their plan to a friend. remember, medicare doesn't cover everything.

the rest is up to you. call now, request your free decision guide and start gathering the information you need to help you keep rolling with confidence. go long™. ♪

banks have been struggling this year as they await the fed's next move. neel kashkari continuing to criticize the fed's approach to banks being too big to fail. take a listen. >> the biggest banks in america are bigger than they were before. the industry is more concentrated than before. and so while some good has been done, i'm afraid it hasn't gone far enough. and so my view is now is the time for us to consider more transformational options to solve the too big to fail problem once and for all. >> let's bring in tim pawlenty

financi good morning. >> good morning. >> people wonder why a man who has been raised in the banking world is now so strident on breaking them up. what is it that you think he sees? >> i can't speak to neel's motivations in that regard. he's new in the position of the minneapolis federal reserve. we all should share the goal of ending too big to fail. it's important to recognize that dodd-frank explicitly says it does that. what neel and others might be saying is we don't believe t even though we see it in the paper and laws, but we don't believe it. he thinks something else additional should be done. people should know dodd-frank purports and takes strides to end too big to fail. >> he talked about good works being done. you talk about being strides. give me an example what has worked? >> what dodd-frank does, it hasn't been tested yet, there's more capital, more cushion than before the crisis, more oversight, living wills, provisions to wind down and

allow institutions to fail. taking out management, shareholders, and making the i industry pay for failures. so, all of that is on paper in dodd-frank. the people who are in the obama administration says that ends too big to feel and neel is saying no, it doesn't. >> one of the most critical opponents says big banks are paying out more dividends, taking on more debt and don't have enough equity. what do you say to that position, raising the capital levels and equity levels as a way to prevent too big to fail bank bailouts? >> if you look at the cushions in banks, including large banks, they're at least twice if not triple before the crisis. great progress has been made in that regard. people who want to break up the big banks either say put capital requirements at draconian levels and force them to break up, or just go back to glass-steagall

or something like them and break it up. that's really what people are saying. they want to break up the big banks. people should realize that of the world's largest 20 or so bank banks, about a handful are in the u.s. if you break up the biggest banks you will turn over competitive advantage to other players like in china and brazil. lastly we need banks of all sizes. we need community banks, mid-sized banks and big, global banks to compete on a global stage. >> governor, i would be interested into what you think the silent majority in this country think about banks? many are concerned that hillary clinton took money from goldman sachs. on the other side you have donald trump making headways on the suggestion that the lobbyists have effectively got something on the people that they gave money to over the years what do you think the majority of people watching you now think about the banks?

>> clearly the majority of people don't like big banks and the polls show that. that's why the politicians use it as an easy punching bag. we have to have people follow the law and have good behavior. the crisis revealed that didn't happen before the crisis. and now the question is making sure you do this going forward in a way that protects consumers, protects the economy, but doesn't stifle needed lending and deployment of capital into the economy which could drag down or slow the growth in the economy. >> finally, governor, neel is doing this in a town hall setting. a very public forum, twitter, op-eds. he ran for governor. he is this all a precursor to running for high office again? >> i don't want to question neel's motivation, clearly he has a political part of his portfolio in the past. his district in the federal reserve region that he's there doesn't have one of the large

top four banks. it's an important discussion, i applaud him for raising it, but i can't speak to his political or pr motives. >> governor, good to have you. >> thank you. we have a significant update on the legal action involving the proposed buyout of office depot by staples. staples has decided to forgo presenting a defense in the antitrust case. it has asked the judge for an immediate ruling saying the government in staple's opinion has not proven its case to block the deal. you can see the reaction of both stocks now. let you know how things go. let's send it over to sue herera for a news update. >> good morning. thank you. here is your news update at this hour. a suicide bomber on a motor bike detonated his explosives near a busy bazaar in northern afghanistan killing at least six people and injuring 26 more. he was targeting the local police headquarters. no one immediately claimed responsibility for that attack. a bridge collapsed in northwest

pakistan over the weekend after torrential rains triggered flash floods. at least 45 people were killed in the flooding. a united airlines flight attendant opened a plane door and inflated the emergency slide after the plane landed on monday. neither united or investigators have revealed what led to the flight attendant's quick exit. villanova is the ncaa college basketball champion after a thrilling three-point victory over north carolina. the tar heels tied the score with five seconds go after marcus paige double clutched a three-point shot, but with no time remaining, kris jenkins drilled a three-pointer for the victory. what an amazing finish. that's the cnbc news update. back to you, simon. >> a lot of bleary eyes around the stock exchange.

the wisconsin primary is underway. we will discuss what is at stake. "squawk on the street" will be right back.

great time for a shiny floor wax, no? not if you just put the finishing touches on your latest masterpiece. timing's important. comcast business knows that.

that's why you can schedule an installation at a time that works for you. even late at night, or on the weekend, if that's what you need. because you have enough to worry about. i did not see that coming. don't deal with disruptions. get better internet installed on your schedule. comcast business. built for business. wisconsin primaries underway. what's at stake tonight? eamon javers has more. >> look at wisconsin voters casting ballots in wisconsin. we don't know what these voters are doing today, but we think we have a clue about what might happen. so much at stake here in terms

of the insurgencies in both campaigns. we have democrats looking at hillary clinton whether or not show will survive this charge from bernie sanders. on the republican side, donald trump seeking to hold his lead. here's where the polls stand now going into today's voting. donald trump not leading in wisconsin. we have ted cruz at 39%. donald trump at 35%. john kasich down at 20%. on the democratic side, 48% sanders, 45% hillary clinton. the clinton surrogates are out there today suggesting that she doesn't necessarily need to win wisconsin because she's got a pile of delegates already. take a look at the delegate count. on the republican side, donald trump 750. ted cruz back there at 481. john kasich at 143. the magic number here, 1,237. on the democratic side, clinton,

1,692 delegates. sanders just 1,012. needed to win, 2,383. you could ask where is wisconsin's paul ryan today? he's the republican speaker of the house. despite his denials, he keeps getting mentioned as a possible consensus candidate for republicans if they go into a brokered convention. paul ryan is in israel today leading a congressional delegation over there. he is above the fray today. >> remember he announced that at apec. wall street is watching the 2016 race closely. today's wisconsin primary and recent comments from gop front-runner donald trump that a massive recession is near. today it seems to be about global economic uncertainty keeping stocks in the red. joining us for markets and the politics, the director of research and portfolio manager at janice capital, and cnbc

contributor, ben weiss, chief economics correspondent for politico. ben, are you predicting a trump takedown in the state? >> i'm predicting a ted cruz takedown of trump in wisconsin. it's really fundamentally alters the race if trump loses there. it makes the path to 1237 before the convention hard. he would have to win 70% of the remaining delegates if cruz wins wisconsin, it makes the likelihood of a brokered convention more likely. and paul ryan is the name on wall street's lips and washington's lips as a potential consensus candidate to come out of that convention. >> that opens up the uncertainty factor, which markets don't usually like. have the improving odds of a trump candidacy and total uncertainty around this race added to the volatility in markets? >> absolutely. this quarter volatility has been the highest since 2008. and i don't expect that to change. we're going to keep getting high rhetoric then start to have

elections and other issues in europe which will add to volatility as we go forward. >> the question then is on the politics, what would happen to that motivated, passion in the trump base of supporters if we go into a brokered convention? would that lead to more uncertainty and a bigger mess? >> will lead to more uncertainty and a bigger mess. hard to imagine we can get a bigger mess than what he ge got. it's unclear what trump or cruz would do if they don't get the delegates. i think eventually the republicans wou s would coalesc around a consensus republican, like paul ryan. the whole thing is difficult not just for the stock market, but for corporate executives who are sitting on cash, want to make

investments. what will they do if they think they will get a trump white house or sanders white house. >> just on the subject of paul ryan, do you think paul ryan wants to be in that position in he's a young man with clearly high political ambitions. he's already got a job. why would you suddenly throw yourself in front of the tmp train in this environment? why would you not wait to have a clearer run further down the line when maybe the gop may have reformed itself into a different election structure? >> i hear a few reasons. one, it's anyone's guess whether he wants it. deep down, he's an ambitious politician, he's given a bunch of speeches with broad messages aimed at the american public. he does want it. i think he would take it if offered to him. the question about why wait? you jump in front of the trump train a little at the conevention. if you get the nomination you are running probably against hillary clinton in the fall. she's vulnerable, her numbers are not that great. you think you have a good opportunity to win.

you take it where you can get it. if the nomination is given to you, you don't wait around. you run. >> people like you have to make investment decisions. i find it interesting that you like opportunities in healthcare given the political noise around this, especially with the inversion rules and the fact that hillary clinton has been hammering the sector. >> i know. maybe it sounds crazy to you. the reality is we're at the break through in terms of new innovation in the healthcare sector. let's take a company like amgen, they have arthritis drugs, one of the most common problems in the world. they have drugs that address heart issues. some new products for prophylactic treatment of migraines. that's a growing field no matter what and trading at a low multiple. >> i know you like technology, too. >> absolutely. in the tech space, as companies continue to innovate and become more focused on costs, they have

to invest in the software area. that's where we invest our money. >> great discussion. thanks for joining us. when we come back on "squawk alley," an exclusive with the starz's ceo. the dow down 85 points, s&p 2050. we're back in a minute.

everhas a number.olicy but not every insurance company understands the life behind it. for those who've served and the families that have supported them, we offer our best service in return. usaa. we know what it means to serve. get an insurance quote and see why 92% of our members plan to stay for life. the dow is down 98 points. let's get over to rick santelli for the santelli exchange. good morning. >> good morning. thank you. i would like to welcome my guest this morning. mark, thanks for taking the

time. >> my pleasure. good to be with you. >> i like to read your pieces, not only do you concentrate on issues that i think are important to monitor the economy like productivity and gdp. you created gross output, your own version. so why don't you hit all of those areas, gdp, gross output, productivity. tell me what you see. >> everything is moving in a downward pattern. gross output, the largest measure of the economy, it includes all the stages of production and it includes b-to-b, business-to-business transactions that gdp leaves out. that's flat. gdp is in decline as well. final output. productivity is in decline as well. i am not in the secular stagnation camp like larry summers and robert gordon in northwest university where you are. i'm more a belief that this is

manmade that cis caused not so much from demographics, but obamacare, increases in regulation, increases in taxes. all of this has hurt productivity. basically b-to-b, business investment, business spending is much bigger than consumer spending. it's almost twice the size of consumer spending in the economy. and we really need to do something to increase business investment because that's why productivity is in decline right now. >> see, it's interesting you mention that on two fronts. the first front is, of course, that when it comes to productivity and it comes to the issues that are the headwinds that you mentioned, obamacare, regulation, those are much easier to try to change when the political landscape changes, should it change in november versus real structural issues. your thoughts? >> no. i don't think it's -- i think

it's difficult to change. i don't think they're going to abolish obamacare, even if republicans get in. they'll toy with it and so forth. it's like sarbanes-oxley. today it would never pass. but it's part of the law. and we've had to deal with it. taxes can be reduced. corporate tax in particular would be beneficial. basically the federal reserve is doing all the heavy lifting right now. we're not relying on any kind of changes in taxes and regulation. we're depending on the super easy money policies you've been talking about that are keeping interest rates way too low. and it is really hurting capital investment as a result. creating some artificial bubbles as well, which i think can be dangerous. but the fed -- a lot of people don't know this -- the money supply is growing at a very fast rate. 8% to 9% on m2. that's much faster than has been the case over the last four, five years. >> mark, thank you for your

thoughts. we'll continue to monitor and bring you back when we get our next look at the fresh gdp figures for this quarter in about a month. have a great day. >> thank you. >> simon hobbs, back to you. >> thank you very much. an update from north carolina and that corporate backlash against the anti-lgbt bill which, of course, was signed into law there at state level. p paypal cancelling plans to build a new facility in the state. paypal saying the state law perpetuates discrimination and the company is looking for an alternative location for that new operation center. so the suggestion by the lieutenant governor of north carolina, dan forest on the program last week that there would be no effective backlash in north carolina, clearly incorrect. a growing fad in the fitness industry. talking crossfit. the company is expanding across the country with more than

10,000 gyms so far. the ceo of that company will join us next on "squawk on the street." taking control of your health isn't easy. but cigna is there for you. literally. just download our free coach by cigna app. for personalized programs from a team of health coaches to help you achieve your wellness goals. cigna. together, all the way.

from icy ocean waters... to your kitchen counter. on. pure. pristine. each one its own delicious arctic prize. when you cook with incredible ingredients... you make incredible meals. fresh ingredients. step-by-step-recipes. delivered to your door. get your first two meals free blueapron.com/cook .

great time for a shiny floor wax, no? not if you just put the finishing touches on your latest masterpiece. timing's important. comcast business knows that. that's why you can schedule an installation at a time that works for you. even late at night, or on the weekend, if that's what you need. because you have enough to worry about. i did not see that coming. don't deal with disruptions. get better internet installed on your schedule. comcast business. built for business.

credited with revolution revolutionizing the modern fitness j fitness industry, greg glassman joining us live from seattle, the first stop in the 2016 cnbc iconic tour. mr. glassman, if mornigood morn. >> good morning, simon. >> i'm wondering what a guy no built his suck set on being unconventional in so many ways actually tells young entrepreneurs who want to make it. what do you say on the stage take? >> i'm going to share with them that will there is more to business than making money. that's not the heart of it, that's not the essence of it. and i think that is particularly true of my success, crossfit's success. >> some people would say perhaps quite accurately it's a cult, a passion that people have for it. as time goes on, do you

understand better why there is that type of emotional reaction to it, what nerve in essence you're hitting here? >> yes, i'm son, what happens to i'm in the crossfit gym is a transformation of unprecedented value and significance.son, wha i'm in the crossfit gym is a transformation of unprecedented value and significance. to do that in the company of other people, you make quick and long friends. more than friends. it's an important component to what is happening in our gyms. >> a bit like a tribe i guess you could say. >> very much like. >> i read, and i haven't done it, but i know many people that do, that the program doesn't change whether you're an olympic athlete or a grandparent, you still effectively do the same type of routine, it's just that the intensity or duration might alter. outside of crossfit, others say it's dangerous and i wonder how

you counter that. is it important that you kind of check as to how people are doing stuff? >> my affiliates in the united states are self-insured. so we get to see the insurance claims of thousands of gyms. and these gyms, these claims are administered by people that administer for the rest of the industry. so i can easily look right at you and tell you that we're safer than anything else happening in the industry. dangerous? let's talk about danger. 1.8 million americans died last year from sitting on the couch and watching tv. that is from said deny tags and malnutrition. so we are a threat, but it's easy to demonstrate. we're the fitness program in police academies, military

units, we're being able to perform, being able to show up uninjured is job number one. so there is nothing real there as far as i'm concerned, as far as we're concerned. >> you did mention that money making is part of it, i know it's not everything to you. but i'm curious how you approach partnerships like reebok for instance which has long been your partner. it's not exactly the whoest sports wear company on the block. how are you looking at the sports apparel market and deciding who you want to stick with and what makes sense? >> reebok approached us with a simple proposition after everyone else in the apparel industry did, but they hit it from a different angle. they were crossfiters. banning nike shoes is ridiculous. i wear nike shoes. i talk to people at nike making shoes for crossfiters.

there is no there there. we have the relationship with reebok because the terms were good, the timing was right. we were growing an international sport. we had 330,000 people register for the open making it the most participated sporting event in the world. we needed a title sponsor an twist coverage and they came hand-in-hand. i'm proud of the relationship and the shoe they're making. money is to a businesslike jet fuel is to an airline. the goal isn't to burn fuel, the goal is to get passengers safely and comfortably to their destination. it correlates, but it's not the cause, it's not the root of anything. >> it's great to see you, great to meet you. enjoy the conference. greg glassman joining us live from the cnbc iconic conference in seattle. >> thank you. much more cnbc is coming up.

the dow down about 104. squawk alley is next. getting unlimited data for your family is a struggle. other carriers either don't offer it, or it's too expensive! not t-mobile! introducing the best data plan ever! get three lines of unlimited 4g lte data for just fifty bucks each, and get a fourth line, free! yup!-we'll give you a fourth line at no extra cost. so tell those other guys you're done worrying about data. get three lines of unlimited data for fifty bucks each, and a fourth line on us. hurry, only at t-mobile. the first stock index ♪ (musiwas createdoughout) over 100 years ago as a benchmark for average. yet many people still build portfolios with strategies that just track the benchmarks. but investing isn't about achieving average. it's about achieving goals. and invesco believes doing that today requires the art and expertise of high-conviction investing.

translation? it's time to bench the benchmarks. for fastidious librarian emily skinner, each day was fueled by thorough preparation for events to come. well somewhere along the way, emily went right on living. but you see, with the help of her raymond james financial advisor, she had planned for every eventuality. ...which meant she continued to have the means to live on... ...even at the ripe old age of 187. life well planned. see what a raymond james advisor can do for you.

>>od