good friday morning. welcome to "squawk alley." we're at post 9 of the new york stock exchange, a lot to get to today between am zone's eavesdropping echo, web sites going dark in europe and netflix becoming the highest valued u.s.

entertainment company -- actually in the world. we'll begin with the charges against harvey weinstein contessa bruce, julia boorstin, and robert frank, are all covering this. contessa, good morning. >> reporter: we know that harvey weinstein plans to plead not guilty, he's facing two counts of rape and counts of a sexu cra sex act. now facing felony charges. they stems from alleged encounters with two different women, one in 2004, one in 2013. r r ronan farrow had written about this, but until now, he hadn't faced criminal charges

his attorney says he denies all allegations. >> my job is to defend something that is criminal behavior. bad behavior, mr. weinstein did not invend the casting couch in hollywood. to the extent there is bad behavior in that try, that is not what this is about bad behavior is not on trial in this case. it's only if you intentionally committed a criminal act, and mr. weinstein vigorously denies that >> reporter: brafman says weinstein has deposited a million cash for bail. he's being fitted with an will be trong device and he's waived extradition where other jurisdictions are still investigating him. brafman says they will decide yesterday -- who by the way "new york times" a grand jury is looking into the initial financial payments allegedly made to other women who accused

him in the past. weinstein is due back in court by july 30th one more point in new york state, a felony count of rape carries a maximum penalty of 25 years in prison. guys >> contessa, thank you stay with us we're going to bring in julia boorstin from l.a. with more this has been an incredibly swift fall for one of the biggest moguls in hollywood. >> reporter: it's been really remarkable to see what has happened not just for harvey weinstein, about you for all of hollywood since october, which is when the first expose was written by the "new york times" detailing they allegations since then over 80 women have made accusations against harvey weinstein. so over the past eight months we have seen so many different stories come out in these movements, but i think it's worth noting and remembering who harvey weinstein was before all these allegations started to

take him down. the weinstein company, though it filed po bankruptcy and assets later sold, had grossed 2.4 billion across 133 movies. remember weinstein himself was known as an oscar maker. this was a guy who produced movies that won 81 oscars in total. there were a total of 341 nominations, so the fact that heck should have such a huge impact on hollywood is perhaps one of the reasons he was protected for so long. >> on that note, with how many movies and content this company did turn out, the fact you have such uncertain m & a, obviously the fight that's going on with cbs, what does all of this together mean in terms of how content is being created right now and the uncertainty around that >> i think one reason women felt comfortable coming forward making the accusations when they

did is because he had lost a lot of his power he was a king maker and oscar maker back in the hey day of the independent film era, but the industry has changed a lot the weinstein company left with in is bankruptcy filing, it was not much they had less than $500,000 in cash, and the whole company did not sell for that much i think that's because industry has shifted so much. it's more about television, the value of the content on streaming and tv and the big-budget movies like "solo" we'll see opening this weekend the kinds of movies that weinstein made are just not as valuable anymore >> julia, are the changes that have happened thus far not just culturally, but institutionally in hollywood do they seem to be lasting

changes? the idea that a certain prominent actress will say unless there's equal pay, i won't participate in this project, unless there's representation of multiple different types of people in the crew or cast, i'm not going to participate. is that a change that's lasting, or is that a fad >> it's too soon to say, jon we'll see. i think a lot of people are hoping it will be lasting. there was the establishment of this time's up movement, saying it's not a moment, but a movement including inclusion writers, which we heard quite a bit about at the award shows, so i think it will take quite a long time, but there's definitely an awareness in hollywood about the potential risks of bad behavior, and also the potential value of including more diverse people into the creation of content, consideration just how diverse

the people are if contributing to the content i think that will be one of the things that makes sure that things change in hollywood. >> hard to argue that any of that is a bad thing. robert frank is looking at the state of weinstein's finances and assets we did mention he posted the million dollars for bail good morning. >> good morning, he did post the $1 million check for bail. he also had to post a $10 million bond that adds to the financial strain of a man who until recently had multiple mansions, he hosted parties arounded world and appeared to be worth hundreds of million. two years ago he bragged that the company was worth two 700 to 800 million, but that was after a lot of failed investments and fashion brands and web sites, a lock of any big hits since 2013 and the recently alleged payments to women and lawyers to settle claims.

that slashed the value he was fired last october, the company filed for chapter 11 just this year it was recently sold at a bankruptcy for $310 million. most of that is going to go almost entirely to the unsecured creditors, so he doesn't get that weinstein had a 15 to 20 million divorce settle somant with georgina chapman at the end of last year and told his first wife he was suspending child support payments, because he didn't have the funds. this year in a huge fire sale, he sold off all three of his homes for a total of around $52 million including a mansion in the hamptons, had been listed for 13, he told is innian wear for $10 million. then a waterfront estate in west per, connecticut, that was so the in march for $16 million his main residence was a townhouse in the west village that he bought for $15 million,

reportedly just sold it for 26 he also has a cottage listed in west hollywood experts say the troubles could be in the tens of millions which could drain most or all of the proceeds so not much left for harvey weinstein and questions of whether he can even afford this whole process as it moves forward with settle months, lawyers and a very lengthy multijurisdictional court process. >> indeed it is a big story. i want to get back to contessa brewer, who has been covering the trial side of this contessa, a lot of us are familiar with the many stories of women who have had encounters with harvey weinstein that were negative this case involves two of these specifically, though everybody might feel they know how this this is going to turn out, what are people saying about how hairtight this case is based on

the two particular women who have come forward with their stories at trial here? or will be >> reporter: one of those women has made her oak saying known publicly nbc news has learned that she is one of the two women on whose complaints the charges are based. the district attorney said their cooperation was fifty pivotal, but remember there have been other women, some of them famous, who have brought their complaints again harvey weinstein to the authorities in new york before, and the manhattan district attorney has declined to file charges in the past why that was, what maid the difference, it's hard to say, but this is a pivotal moment just the harvey weinstein case alone, to say nothing of the myriad other cases where we are seeing alleged bad behavior has

gone -- has been allowed to proliferate, it was sort of looked away from whether that becomes issues for district attorney to be more aggressive in the future, we'll have to see. >> >> we've talked about his declining influence, but a lot of the ailing came when he was still quite powerful contessa, the journal yesterday raised the issue of whether he lured women across state lines. >> reporter: in fact brafman was being worried about a federal investigation and federal charges, and he declined to comment. i just warranted to let you no in this criminal complaint, you know, again this goes back to 2004 one of the things that makes a difference with them pressing forward is states have begun allowic the statute of

limitations, getting rid of it for example there's no longer a statute of limitations on a rape charge, that they can go back and charge that. the same thing is true in new york state apparently they've been trying to look at the amount of time that weinstein was in new york versus somewhere and use that to somewhat push back again the regulations at any rate. guys >> contessa brewer, robert frank, julia boost, also thank you. when we return, a new scandal, why you may want to watch what you say around alexa. new privacies protections going up across europe more "squawk alley" after this we've had a large team working on this inside facebook to make sure we are clients. >> we are working very closely with publishers and partners we hope to update and i have

privacy policies and controls that we. >> on the 25th of may the world vell change, with gdpr, we will ha to operate recognizing that privacy is a human right

a glee the company under fire after an echo speaker reportedly call reporting and sharing a family's private conversation

and sending it to a random person, an employee of it is husband. jean, talking about, i guess, the implications for the companies that are dealing so much in a.i., so much in data we say when we ask directly, alexa just went off on her own behalf what she thought she heard a years ago there were about 14 million of these devices, about 17 million today it's likely

happened other times, so it's pretty infrequent. the concept that they're still struggling to understand now, we test they devices. they can understand in a quiet room if a person is speaking to it almost 100% of the time more recently we did a test, and it got 997 out of 1,000. the problem with can ambient noise and conversations with more people, then the comprehension dips this is a great example of where it's at, and we're not there yesterday. >> it's an open microphone in your house, and it's subject to all the kinds of oopses -- oh, i didn't -- a butt dial on your

phone is one thing on alexa, apparently it's something else inch and asking the question for the implication for investors it one thing the implication for consumers i think it will have ramifications. the creepy factor on this is huge and i think people will panic when they think something is happening in their home and are indiscreet and say things that are not for public consumption. i think it will put a pause on people who are considering an alexa or in-home device. that makes sense for consumers having to train themselves, but for consumers being created born into adulthood, it might be

different, right it's a longer term story, but it might be different. >> the first time someone accidentally sends an e-mail that wasn't intended for the person to the wrong person, that will create a behavior response. people field a bit grossed out when they thought things that were private suddenly become public i think it will have an impact >> jean, quickly, before i move on to the next topic, in light of that, does it shine the light on other virtual assistants as well >> yeah, they will all be subject to the same uneasyness that consumers are going to have that's a great point statistically this is one in a million, but it does have an

fluent, and that impacts cortana, siri, google home. >> one in a million, how often i guess is the question. europe's new data privacy law going into effect, causing several u.s. web sites to go dark, and complaints already broadband filed josh lipton has more. >> gdpr, general data protection regulation, is in effect, so that means eu individuals will not be able to access their personal data storied by companies, find out where and for what purposes it's broadband used, and they can take their data and transfer to to a different provider investors watching gdpr closely, because using data is the lifeblood of big tech, who rely on their app, services and website. it's that information that fuels

their control of that $273 billion market for online advertising. this morning as you mentioned, john, there are reports of some american news outlets blocking access to their web sites from europe, rather than rink those stiff fines, trump telling us we are engaged on the issue and committed to looking at their options that support our full range of digital offerings the concern for big tech investors that these news rules will impact user growth and ultimately add revenues, but annualists don't seem too worried, rbc saying they are reasons to believe that the regulation will not have material impact on the operations those same analysts say, though, that smaller companies could face more of a challenge, regardless, companies do have to comply with gdpr or face real fines.

>> guys, back to you >> thank you, josh stephanie, the biggest thing i have heard from people in general, they don't know what gdpr is, but what about all this is privacy policy e-mails, and -- i like this what do you think the impact is likely to be long term now it's coming into effect whether the u.s. does the same thing, consumers actually push for this here >> maybe i'm being overly optimistic, but you showed a clip earlier talking about how with great power comes great responsibility i would love to see corporations embrace the spirit of this law i mean it would be really terrific if he saw institutions take a look at the positive impact they're receiving, people who actually do want to have just a little more corrosion, and take that as a sign there's

something in the spirit of this law. i get it, it's complicated, complying with it will be tough foresmaller companies, but the spirit of trying to give some control to consumers and giving them some opportunity to have a say in how their data are used, if companies embrace that, they'll see a halo effect. >> to the point about big companies have been more resources to apply, big tech wins again. >> over one or two years i think you could see an impact. facebook on the last earnings call said that complementation of these new controls is going to cause european user growth, that may be flat to down this would be the first time to see a region flat to down that's

a big deal they say searches is not something is data sharing. in particular facebook how much of a risk is that how challenging is that? >> i think it's always going to be a challenge, especially in year one of a new set of

regulations. my hunch is you will see some companies get fined, and there will be a negotiation, like there always is. i think, though, that the european union will hold firm on this i don't think you'll see the regulators back down or cave to corporate pressure like you may see in other institutions or other countries. >> will this apply to alexa? >> yeah, eventually. the whole topic around privacy and digital assistants hasn't come to the front. foib was likely going to announce a digital assistant at the f.a. conference, but with the things going on, they felt it not the right time, a good move by facebook so yes, you willy. finally moving on to netflix, the streaming service hitting a new 52-week high to

become the most highly valued entertainment company in the world. stephanie, the way i guess traditional media companies feet about netflix reminds me of how publishers felt some time ago, except that netflix is expanding the premium market, where those players were current of depressing the market. what do you think this moment means? >> well, i think you've accurately identified the tension there and traditional companies have been responding to netflix for a long time -- and to a lesser extent amazon studios. i think there's two aspects, one is the valuations of these

companies. the other question is at what point does in the meantime flex -- we always compare netflix to disney. people spend a lot of time dissecting bob iger's management style. it's a management story as much as a content story, a create activity story i feel like netflix hasn't -- in fact because it's go youing so much but at some point people will be digging into that as well. how good are they as being stewards of their shareholders' mon money. >> i mean, the projections would suggest there's a long runway

before we get to the point that stephanie is talking about >> i'm more on the camp it would be different to keep this growth going. 30% in '16, 33% in '17, accelerating growth, 40% in the most recent quarter. this is an unprecedented 3 1/2 years of accelerating growth i want to give them full credit for what they have done, it's been impressive. even with international growth, growing at 35%, which is still phenomenal, that is probably a compressed multiple. now, maybe the earnings piece more than offsays that, but i think this gets-to-to be dangerous territory. >> stranger things have happened. >> ha ha >> thank for being with us today. coming up in just a few

minutes, wes edens is with us here, the on the bright-line railroad stay with us ♪ this is a story about mail and packages. and it's also a story about people. people who rely on us every day to deliver their dreams they're handing us more than mail they're handing us their business and while we make more e-commerce deliveries to homes than anyone else in the country, we never forget... that your business is our business the united states postal service. priority: you ♪ hello. give me an hour in tanning room 3. cheers! that's confident. but it's not kayak confident. kayak searches hundreds of travel sites to help me plan the best trip. so i'm more than confident. forgot me goggles. kayak. search one and done.

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welcome back, everyone i'm sue herera an indiana middle school is on lockdown after gunfire erupted inside the building. local officials asa suspect, a male student, is in custody. s.w.a.t. teams are securing the school two victims have been taken too local hospitals. they are reportedly a student and a teacher. fiat chrysler is recalling vehicles from six model years. the automaker warns in rare circumstance circumstances drivers may not be

able to turn off the cruise control. aaa reports that gas prices are rising to nearly $3 a gallon, on average. forecasters says this year's hurricane season may see above-normal activity. hurricane season officially begins june 1st. carl, i think they're watching the new update, because the national weather service just named the first trop cal weather systems of the 2018 season, and it's alberto >> i just noticed that we'll see what the "b" name is. >> exactly. >> europe is closing for the week here. seema mody back here for the european close, they're actually on line to snap a winning streak combined 4.4 billion in outflows just this week

that's the most we have seen since july 2016. the main reason is the political uncertainly with not just italy, but spain as well. two-year yields set for the biggest weekly rise since the europo debt crisis as giuseppe conte is putting together his cabinet. the bond market further concerns about the promise to boost spending, now, let's switch as to spain, its prime minister saying he has no plans to call for a snap election and intends to serve out his term. this comes as the opposition is threatening to oust him in the wake of a graft trial involving members of his party banking

under pressure today. the europo is extending its weekly loss today to six typically a weaker yurt-to-helps stocks outperform, but politics keep a lid on european equities, plus the data hasn't been as of late or as strong as of late. >> seema mody, thank you. coming up next wes edens since downs with you more when "squawk alley" returns. at fidelity, our online u.s. equity trades are just $4.95. so no matter what you trade, or where you trade, you'll only pay $4.95. fidelity. open an account today.

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impact our next guests -- fortress cofounder wes edens who owns brightline, the only privately owned passenger railroad, which just opened its second leg of service. wes, great to have you here. >> thanks for having me. >> let's start with bright line, now that you have service from miami to west palm beach how is ridership going so far? >> last weekend was the first

weekend and we were sold out it's going to be the big subject down thereon we think there's lots of -- too short to drive, too long to fly. atlanta, charlotte, houston, dallas, st. louis, chicago many we think are viable >> and when you talk about railroads, you're talking about putting steel on the ground. >> well, you know it's a big impact on us, right? we try to lock in the construction stuf ahead of time so it's something we pay a lot of attention to. >> sofbank is buys a lot of stuff. a lot of people says fortress didn't enjoy the experience of

being public, what is your thought about the current market and current mindset. a lot of founders have said it's more short term than ever. >> it's been an interesting experience i would say we're enjoying our time being promised. the news with softbank is as advertised there's a lot of positives to take out of it. >> why would it make that difference why would it affect operational methods? >> it removes one extra job we have to do when you think of it, when you're the head of a public company, you do the job of your investing day job and have been to be the ceo or co-ceo in our case to spend times on other things no more quarterly conference calls, and that's probably part

of what's been successful for us >> when you look across different asset classes, where you do you see the most opportunity? energy with wti? >> yeah, we think there are huge opportunities. we have a big natural gas and lng business that's a private company doing terrifically that's a big part of it. i think health care, the reform of health care will continue to be a big stony line over all of us that's significant, but the reality is it's a tough time in the market to find interest things to do, but we look at a lot ofthings. >> there does seems to be an emerging cycle you haven't necessarily seen a lot of m & a activities. you're saying we're long in the truth? >> i think it's time to be cautious, but there's a lot of aspects to the economy we see a lot of very good performances across the

portfolios you just need to be careful to find new things to do. i want to ask about the business of sports. you're the owner of bucks, sterling brown has been in the headlines with that confrontation with milwaukee police, where the police themselves have said it wasn't handled the way they would want to handle it sterling brown has talked about bias in policing what's the responsibility of an owner of a team when a player has an interaction light that and raises what some will sees an an activist -- >> first of all, we're proud how sterling handled the entire situation. if you've seen the video, it's a pretty difficult situations. i think he handled it tremendously well. didn't escalate the situation, and there's a lesson behind it that's terrific. we're very supportive of sterling brown the man i'm a person who believes the

solutions, an the solutions in this case are pretty darn complicated. you had either the maid yor or police chief saying they overreacted and then it's about getting trust. this situation is not isolated. >> look at how it's translated to kaepernick, and then steve kerr's comments this week about the nfl, right >> yeah. >> and using this as a political -- called it idiotic it seems like the nba, for lack of a better word s. procedure progressive. >> its i can only talk about what we do i'm proud to be part of the nba and part of the organ asian that believes in partnership with our players. we want to solve the difficult issues together. that's the way we have approached it and that reflects the diversity of the league.

>> we having to to get your rereaction on the supreme court d. and we had mark cuban on saying she expects to the top steams value, i think first i would give a shoutout to adam silver adam and the league had been on the forefront. the legal standpoint is states' rights issues. i shipments are gigantic i think economically there's a lot of opportunities from an owner's standpoint, we think it only makes people more engaged in the sports. through the fantasy side, that relates to better media values, better economicing to all of us. >> do you think it changesle ncaa stance towards gambling >> i don't know. i think that's a tricky

question, there are millions bet illegally on ncaa sports, that's for sure i don't know where they come out with that. >> i'm going to shift the focus back to markets here what do you think of equities? fairly valued? >> i really do we don't see the kind of overbought issues we have seen in the past. it's not necessarily a good time for making new investmented, nor is it the time of a verge of an oversold on panic situation. >> when you look at the big drivers, there's a lot of talk about 5g right now, also talk about the rising middle class and a lot of emerges markets what do you think will be the most powerful drivers? >> do metzicly this whole a.i. issue is something we talk about a lot. one of the things we're a big

investor is in transportation. 35%, 40% of costs come from drivers. >> i'm glad you brought up transportation before we let you go, i was in l.a. earlier this week with spacex, and she brought up maybe the boring could get could be used to dig tunnels on mars. taking it back to earth, they are working on these tunnels and loop project is that something you would want to invest in >> ii it's fascinating i would love to understand the economics. as you build trains, gettirightf ways, you've heard his goal is

to build slightly faster than a snail digs, but it's interesting for sure i don't know what the math would look like. you look at nvs, they guys in other parts of the world with so much money to spend, such a long-term vision, do you see anything like that in the u.s. is there financial prowess a force for good >> i think there's lots of examples you have people take long-term bets we haven't sold a lot of tickets, invested millions on it, but masa has had a tres amount of success in his life, and a lot of success from us just being a little closer to it there's lots of capital looking for things to do so interesting times i think we could take the rest of the show to keep asking you questions, but thanks for

joining. >> thanks. come ride our train. we would love to have you down. >> looking forward to it wes edens, thank you. what disney and the box office are expect fred "sol so are ooh. cogs down into tight range "squawk alley" is back in a moment i was in the stone ages as much as technology wise. and i would say i had nothing. you become a school teacher for one reason, you love kids. and so you don't have the same tools, you don't always believe you have the same... outcomes achievable for yourself. when we got the tablets, it changed everything. by giving them that technology and then marrying it with a curriculum that's designed to have technology at the heart of it,

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i'm melissa lee. here's what's coming up on "the halftime report. oil's big fall after energy's big run. several names down 5% or more,

including conoco, marathon, and hess time to double down or run >> plus, with europe falling and the ten-year yield dropping below 10%, there is no alternative to stocks, trade back on. we're debating foot locker as the stock is soaring today all that and more as "the halftime report" start at the top of the hour. >> we're looking forward to it >> we'll have more "squawk alley" right after this break.

it is time to get to the cme group and rick santelli with the santelli exchange. rick >> thanks, jon >> over the last several days to several weeks, i have been questioned in many instances as to why what's going on in italian bond market is not more disruptive to the globe. more like the credit crisis where things were getting dodgy and there was a lot more perspiration >> in a way, it has, but not in that exact same way. rarely are things exactly the same in markets, and this time is no exception. this time, what's going on is more of a contained contagious, but the contained contagious is orderly as it may seem, has big lessons to be learned, and we are still many chapters away from definitively making a statement that there's disruptive forces beneath that move are over or done because they could resurface at a

greater extent any time. what i'm talking about is global capital versus regional policy and regional central banks think about it this way. central banks and mario draghi in particular, can try to put an interest rate anywhere they want it, but in the long run, market valuation and true price discovery and true risk/reward parameters will prevail. do we have any proof of this it's going on before our eyes. chart number one, these are mid-may. that's ten-year boons versus italian tens you see that crazy cross there that is market reality starting to set in. keep in mind, that boon now is 40 basis points. it's settled at 43 our ten-year note even with the big rallies of 2.93, settled at 2.41 let's look at the two year shots versus the italian two year. same thing where did it close

at minus 62. where is it now? minus 66 four basis points lower. the point here is that the markets and the forces at work are starting to overwhelm the longevity, the ability, the bazooka firing power of mario drago. and that does have big implications then add in the next chart, the dollar index dollar index, should it stay here at the highest close since november '13 imagine what that's going to do to emerging markets. i'm not trying to say there's going to be constant disruption. what i am say is u.s. interest raets rates are going down slowly, and it's going to be much more difficult to push them up until what's going on in europe starts to or ends and plays out jon fortt, back to you >> a lot to chew on over the long weekend thank you, rick santelli >> when we return, why the box office estimates for the latest installment of the star wars

franchise "solo" are so low. more "squa aeyafr e eak.wkll" teth you run those miles, squeeze the toothpaste from the bottom and floss to set a good example. you fine tune the proposal, change the water jug so no one else has to, get home for dinner and feed the cat. you did a million things for your family today but speaking to pnc to help handle all your investments was a very important million and one. pnc. make today the day.

premiered in 1977 on this date, and of course, "solo" is out

this weekend, where the box office projections maybe not as bullish as some had suspected. some of the reviews a little tepid as well. >> you never know what might happen >> of the top three movies expected this weekend, disney has two. >> that's right. don't forget to remember memorial day and all those americans who died in active service. let's get to melissa and the half and welcome to "the halftime report." i'm melissa lee in today for scott wapner the energy trade running out of fuel oil sinking as saudi arabia and russia reportedly talk about a production hike. with us for the hour, josh, sarat, jon najarian, erin brown. finally, doc, we saw energy stocks rise loov with oil, and we have a big setback today. >> huge setback. chevron perhaps getting a deal with saudi arabia, putting more production on saudi arabia increasing production in other