and "squawk alley" is live ♪ good wednesday morning, welcome to "squawk alley." nasdaq is up well over 6% quarter to date. it's on pace for its best quarterly performance since the first three months of 2017, although its first negative month since march as we continue to watch the pressure build on big tech take a listen to mark talking to jim last night about facebook. >> we have given a huge amount

of our power to so many technology companies that's why there is a discussion now in washington, d.c., about regulation should they be regulated not just facebook, but every company. they lost my trust because of how they have handled their privacy scandal. they are in a crisis of trust. facebook is still in that crisis of trust and so you see those actions by customers, consumers, and executives now, they can change every company can change they're not the only company that's going through a crisis of trust. but our industry needs to wake up and realize that there is a tech lash happening. >> meanwhile you've got alphabet going to capitol hill on friday. a senate commerce hearing today about consumer data privacy regarding social media companies and tech joining us this morning, chris aleman oversees the world's largest educator-only pension fund, just over $227 billion under management chris, it's good to have you

back, good morning to you. thanks for joining us. >> good morning, good to see you. >> benioff has been critical of facebook in particular, so have you. are they starting to change enough for you >> you know, carl, we're an investor, we're not a trader so we're going to be long facebook stock because it's in the index. but just like you mentioned in terms of how the nasdaq has done this year, facebook has gone nowhere for over 12 months i'm not that optimistic about it they regulate our mail, they regulate our phones, they regulate even television they need to regulate social media areas because this company has just been a problem after another. >> yeah, and, chris, certainly we got that news earlier that the co-founders of instagram are leaving as well. the second round of co-founders of an app that's been acquired by facebook. >> obviously i think it was a

very good acquisition to buy that company for a billion dollars. i think it's created a lot of value to facebook. but i think it's actually very telling that these important innovators are now leaving the company. i think there's an air of arrogance within facebook, and i don't know that you're going to be able to change that culture so companies really are led from the top, and it's a culture from the top. that facebook board needs to take more control, it needs to be more diverse, and it needs to hold management accountable. it's a good question about whether you can hold this management team accountable. >> yeah, kind of hard when zuckerberg has voting control. taking a look at some of your top holdings, include apple, microsoft, amazon, alphabet. a lot of these names, facebook as we were just talking about, have really soared lately. a lot of people saying they're pretty expensive of course you've got the teachers and their retirement to think about. what do you do how do you position yourself differently after a run like

this >> well, jon, they are expensive. you hit it right on the point. let's stop calling it faang and call it ana. those are the ones that have been moving this market. we hold the russell 3000 index that's 70% of our u.s. equity portfolio. because we're long term, we're going to be a passive index holder so we'll own these companies as long as there are public school teachers in california, we're going to own these companies and we're not a trader i hate to say it, but we're the opposite of your fast money. i'm very long-term patient capital. melissa lee has never had me on her show and i shouldn't be there. for us, these stocks are expensive. if you look back over history, the market has had leaders that become very extended and expensive. it doesn't necessarily mean this market is over i would just like to see the midcaps and small cap stocks

rally a little bit more. >> so, chris, in light of that, where would you be putting money to work right now? certainly equities is an outsized portion of your fund. is it here in the u.s., in other sectors and industries, or are you looking overseas >> you know, within our asset allocation, i would say we're leaning a little bit defensive we're not fully tilted defensive, but we're very close to that because this market has been climbing a wall of worry. as a long-term investor, everything is so expensive within the usa, not just public equities, but private equity, real estate. so we have looked and added a little of money into more of our defensive categories, raised our cash position just a smidge. and what we'll look at is this trade issue and the global challenges that we're facing i think what we'll do is lean more towards defensive categories outside the u.s. equity market. the emerging markets looks

attractive it's cheap but its fraught from problems and the dollar has just wreaked havoc. so we're not ready to feather into the emerging markets yet but i think that's an area to watch long term. >> wells has a report out today, chris, that defined benefit pension plans could pull, they argue, $20 billion out of u.s. stocks by friday as they look for quarter end rebalancing. looking at equity fixed income shifts, do you think that's going to happen that quickly >> you know, i don't most of my peers don't rebalance based on a calendar, we rebalance -- we realize markets don't trade just on a calendar, so we're going to focus more in on ranges within where people want to tilt remember, a lot of the long-term money is outside the usa you've got trillion dollar funds in japan, in norway, saudi arabia those are the people that can really move money in and out of

these markets. but they're investors too. they're very long term so they're going to do subtle course corrections and not massive tilts. i wouldn't expect -- this market has strength because it's looking at the equity market the person to pay attention to is rick santelli paying attention not just to the fed today but their forecast while i'm an equity guy, i've got to say the bond market has typically been right on when it looks forward the next six to nine months, so i've been very worried about whether this is going to be a flat curve and will this be an inverted curve, because i think the bond market will get it right and the stock market is going to have to react after the fact >> that's one reason we're going to be glued to the screens for the next several hours certainly at 2:00 eastern. chris, it's always good to get your take, appreciate it very much see you soon. >> thank you good to see you. >> chris ailman. sticking with that theme, investors expecting a rate hike this afternoon as the fed wraps up it's two-day meeting. our steve liesman is in washington ahead of that

decision steve. >> the fed is expected to hike rates as you said by a quarter point. that will bring the new range between 2 and 2.25%. investors will look closely for hints in the statement of more hikes to come. markets expect another increase in december and they're puzzling and debating how many hikes, two, three or four come next year these are decisions made by people the fed has some new faces so let's meet the new fed here of course on the federal reserve board of governors, there's jerome powell. and he was -- you can see what the administration has been doing here, picking people with different expertise. richard clarida will be in the meeting for the first time richard quarles and there's lael brainerd and we asked where do the guys stack up in terms of the hawk/dove index. you can see most people see these two new folks in the middle of the spectrum

they're pretty much in line with quarles, just a touch more hawkish. then let's look at the nominees. there's nellie lang from brookings, 30 years at the fed, was in charge of financial stability. michelle bowman. kansas state backed bank commissioner and marvin goodfriend whose nomination hangs out with opposition in the senate he is a bit more hawkish as you'll see in the next panel he's the one nominee from the trump administration -- people are pretty surprised how centrist these nominations have been marvin goodfriend the one hawkish person nellie liang very much in the center of the board. where is the center of this board? the answer seems to be continued gradual rate hikes in the face of an economy operating hotter than most in the fed currently believe to be the steady run rate, both in gdp and employment also means continuing an effort to normalize rates, possibly

going a bit above neutral if warranted. but i think they're also not in a particular hurry and are open to the possibility, guys, that the run rate is higher than they thought, which means we could grow faster with less inflation, jon. >> place your bets, we'll be watching thank you, steve liesman when we return, a nice run for ipos lately. we'll get an update on survey monkey as it gets set to make its market debut at the nasdaq. and later, billionaire owner of "the l.a. times" and part owner of the l.a. lakers, dr. patrick soon-shiong joins us right here in just a few minutes. stay with us this isn't just any moving day.

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and two-hour appointment windows. click, call or visit a store today. an update on comcast acquisition of sky after that headline last hour, david? >> one question we had after comcast won the bidding for sky was whether fox, which owns 39% of the company, would tender its shares into that 1728 deal to acquire the company. many thought that would be the case given the high price and in fact they were correct this morning. fox confirming it will sell its 39% stake in sky a company of course that was begun 30 years ago by rupert murdoch to comcast, our parent company, enabling comcast to essentially own all of sky there had been that possibility that fox would not tender and therefore have to work a

separate deal with comcast that's not going to happen the most likely outcome was this it is going to happen. they this morning confirmed they will sell at what is a very full price. of course don't forget initially fox, two years ago, had a deal to buy the 61% of sky it didn't own for 1075 and then of course came along the sale of the fox assets to disney comcast competing for those. comcast's offer for sky, back and forth that has resulted in a price well above that 1075 so originally disney was looking at potentially having to take on additional debt on its balance sheet, fox debt, as a result of the purchase of the 61%. now, well, $15 billion in proceeds this morning disney does come out and say obviously it consenti consented to this sale and it will significantly reduce the

amount of debt disney will inkur in acquiring 21st century fox and enable disney to maintain its strong balance sheet as it continues to invest in content creation for direct-to-consumer platforms. they go on to say they're going to expect to spend even more on their branded consumer offering both entertainment and espn plus they're launching in 2019. so it helps them, although on the rsn side they're buying at a higher multiple than they're selling, but it's certainly, perhaps, an unexpected windfall for disney and ends that long relationship between rupert murdoch and sky, a company that, again, he began almost 30 years ago. >> as we've said, you couldn't construct a portfolio like he's put together in the modern day when things come up for sale, they're valuable >> they are. we don't want to forget the most

important thing in all of this since we first reported back in november of last year, rupert murdoch, a seller. that really is a man who built an empire deciding to actually sell that's still the key reflection of the times we're living in right now and the threat that netflix presents to so many of these companies. >> it certainly puts it into context. we've got shares of all of those stocks higher today on this news as well. disney, 21st century fox, comcast. david, thank you, for bringing us the latest. coming up, virtual reality is becoming a business reality we've got walmart, verizon, jetblue and a number of others making big moves to use vr for employee training. find out why, next. take a look at shares of survey monkey, up 61% as it goes public we've got more "squawk alley" after the break. imagine traveling hassle-free with your golf clubs.

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facebook's oculus event kicking off today in san jose, california, with mark zuckerberg set to speak in just about 90 minutes. our josh lipton is there live and he joins us with what we should expect. josh. >> reporter: we are here at this oculus event where facebook ceo mark zuckerberg will take the stage and deliver the keynote. of course some big, big changes at facebook just this week with the departure of instagram co-founders. some analysts remember like those at jpmorgan did think shares would be under pressure in the short term due to those departures, but the focus of the developers, creators and producers behind me is going to be what's the new oculus hardware that zuckerberg could unveil if you look at the vr market, oculus controls about 38% of

that market. the overall market grew by 10% in q2 to 890,000 units facebook staying tight-lipped about what could be intro tuduc today, but some analysts thought they could introduce a new headset called santa cruz, that could enable a fuller, richer, vr experience. listen, it's certainly true and fair to say that the vr market has in some sense underperformed, more bullish expectations he says at least part of the problem could be this lack of compelling content, a lack of breadth and depth about content that could draw in a mass audience it's kind of like trying to attract a cable tv audience with just one channel we'll see today if and how mark zuckerberg tries to address that challenge. guides, back to you. >> unless it channels cnbc >> naturally. our next guest getting some backing of major corporate clients to help make virtual

reality a reality in the workplace. walmart announcing last week it's going tos use the technolg for employee training at every walmart store in america joining us here now, derrick belch. great to have you here with us you've got the oculus go. >> i have an oculus go. >> that's going to be in those walmart stores so a couple of years ago, everybody was talking about vr as the next big thing for consumers. we saw it with gaming consoles it was a big holiday push. here's what your pc needs to do horsepowerwise to drive this didn't really happen is the employee training market where it's really going to take off first and then maybe it goes broader? >> i don't think it's going to be maybe i think it will get there. it's not surprising to us that headset distribution and saturation has been slower on the consumer side. mainly a gaming device for today. but we certainly feel that when more employees throughout

america and really the world start to touch these things, literally and metaphorically every day in their jobs, it's going to trickle down to the consumer much like we saw with computers a couple of decades ago. >> 4700 stores and there are, my goodness, 17,000 of these units. >> yeah. >> what sort of results are you able to show that gets walmart to make that kind of investment? and are there certain types of work where this improves performance better than others >> so last year -- or two years ago when we started working with walmart we were really focused on operations, process, procedures for store managers. there's a spill in aisle 6 where is there an outage of bananas in the produce department interacting with customers that worked really well in the walmart academy where they train their employees. and now here we are less than two years later and walmart said this was so successful in the academies that we want to put this in every store.

now, how can we touch cashiers, janitors, some of those mid-level managers, folks that candidly don't get access to the very best training daily that a store manager would. now, how do you give them a technology tool that's worked really, really well for store managers and democratize that for all employees. >> one of the steadfast criticisms about vr is when you put one of these headsets on and you start going through whatever it is that you're -- >> nausea. >> exactly, which i certainly have experienced how do you cut down on that? i imagine that's a key part of success, especially when you talk about employee training. >> everything we do at striver, we work hard to make sure it's an equilibrium comfortable situation. if your brain thinks your sitting and your body thinks your sitting and that headset puts you on a virtual roller

coaster, that's where you get nauseous with walmart specifically and all of our customers, we work hard to make sure we're putting you in a static decision-making moment we're not moving the camera or running you down an aisle. we're making it very, very comfortable for the employee that's very important. jon, like you said, this has to work at the employee level for it to likely trickle down as christmas presents for folks this fall and we work hard for that. >> so does thatmean that you think maybe long term it works better as a enterprise product than a gaming product? >> it may. i don't think it's a gaming product. i think gaming is always going to be really, really good. you own one, right someone like yourself that own it and use it daily, i think the enterprise will outpace the consumer but that's dtoday. i think we'll see a really, really cool trickledown effect walmart certainly on the leading edge you can argue they're more than anybody to vr succeeding and that's pretty cool. >> derrick belch from strivr

we'll see what facebook has in store and maybe how it improves this experience further. >> thank you thanks for having me. now over to frank collins, the newest addition to cnbc, for a news update. >> good morning. here is your cnbc news update. lawyers for christine blasey ford said they submitted sworn affidavits from four people who say she told them that brett kavanaugh assaulted her in high school ford's husband and three family friends say she told them this well before his nomination. british operation leader jeremy corbyn rallying his labor party by calling for a clampdown on unfetterred capitalism. in a speech he said the old way of running things isn't working anymore. he also declared he would recognize a palestinian state if he became prime minister. amazon announcing new delivery services in ten cities while broadening delivery areas where it's already operating the entry into the grocery arena has forced traditional stores to

expand amenities to customers. m anld ms is unveiling a new hazelnut spread feature. that's our cnbc news update. back to you. hey, carl. >> good to have you, frank welcome to the family. frank holland. let's get to dominic chu meantime for the european close. >> so, carl, as we look at what's happening with the european markets right now, a bit of wait-and-see mode ahead of that federal reserve rate decision later on today. we've got basic resources among the worst performers in european trading bucking that recent upward trend among the individual names in focus, airbus jumping by more than 3% here this morning after european regulators granted a key certification to one of its models, the a-330 900 model. now, sticking with the transport sector, daimler's ceo is planning to step down in 2019 after more than 12 years on the

job. current research and development chief will take over the reins at the german automaker. shares dipped in early trading but finished mostly flat on the day. finally take a look at shares of aa down more than 12% after reporting a sharp drop in profits during the first half of the year the british-based company blaming bad weather for a pothole epidemic across the country. this comes after it cut its guidance in february citing a need to transform its business overall. those shares down by about 13% in trading back over to you. >> dom, thank you very much. after the break, why the co-founder of whatsapp is saying that mark zuckerberg's heavy hand is to blame for the departures of instagram's founders later on we'll continue our countdown to the fed decision. but first, dr. patrick soon-shiong si dn ths when we're back in a moment. my name is chris hughes

and i am a certified arborist for pg&e. i oversee the patrolling of trees near power lines and roots near pipes and underground infrastructure. at pg&e wherever we work, we work hard to protect the environment. getting the job done safely, so we can keep the lights on for everybody. because i live here i have a deeper connection to the community. and i want to see the community grow and thrive. every year we work with cities and schools to plant trees in our communities. so the environment is there for my kids and future generations. together, we're building a better california. we bought them because that's an important institution that's having a positive impact on the world and is deeply alined with our family's values and we're delighted to be the new stewards of "time" magazine. i hope you and everyone else will help us make it a huge success. >> salesforce's ceo talking about his decision to purchase "time" magazine.

you know he's not the first billionaire entrepreneur, patrick soon-shiong bought "the l.a. times." we're joined by the doctor. >> thank you. >> we might ordinarily want to talk about media but you're here to talk about batteries and some other energy measures. >> yeah, i'm at the one planet summit which is the second element of the paris accord. we made an announcement this morning that just broke in "the new york times" about a zinc battery. zinc is the holy grail and the opportunity to create a zinc, a naturally occurring material in your body and my body and using oxygen and breaking the $100 a kilowatt hour barrier is what we're talking about today.

>> help us understand what the perspective on what the total addressable market might look like. >> we're now the world's largest deployed system. we're in nine countries. 200,000 people on the planet in asia and africa now are using our systems as a sole source of power, the sun and a battery it's a large addressable market. >> so tesla has the power wall, but it's operating on what you would call the older technology, lithium ion. you say zinc is the holy grail how are you going to perform differently, whether it's in terms of efficiency or cost versus a product like that, which tesla says is about $12,000 just for the hardware to install in a home? >> if you look at lithium now, it's $200 to $300 per kilowatt hour it's toxic and requires cobalt zinc with air, we break the $100

per kilowatt hour, which is nontoxic and can now be deployed using just the elements of nature and technology. i think that is the holy grail edison tried to do this 100 years ago and we've now been able to solve this problem. >> so these are rechargeable batteries, but they recharge using the elements essentially. >> correct. >> not traditional fossil fuels. >> it's completely rechargeable. that's the holy grail, how do you recharge it. we've done it now 300,000 cycles the beauty, it uses the sun to generate the electrons, uses the air, oxygen and zinc that's it. >> duke energy has been a partner? >> duke energy we deployed for the first time in which it survived irma and survived florence, which is wonderful. >> is it a transportation play >> it will be. i think one of the things is to

get sufficient both sprint and marathoner it's a marathoner, it can go for 72 hours and sufficiently powered for seven days we need to get sufficient energy release and combination of zinc and some other metal >> is your prediction that lithium goes away? >> it has to go away it has to go away. the toxicity of lithium is really cobalt. 80% is from the congo. you know, it's anticipated 18 pounds of cobalt per car so it was a place holder, it is a place holder. >> they will not coexist, just to be clear? >> well, it will in the interim be a hybrid system where you need a combination of lithium and zinc but the goal for us is for lithium to go away and completely have hydro carbon-free. >> how long before sizewise, productionwise you can get zinc

into something this wise, which is where a lot of the lithium batteries are now? >> you actually have a zinc air battery in a hearing aid the problem is it's not rechargeable so we're figuring out the recharge ability of it and that's the holy grail. we've done this now in the size and we're reducing the size. that's a while away. >> okay. i do want to shift gears a little bit and i do want to get your thoughts on the state of media, especially given the fact that we do have this interview with mark benioff with jim cramer last night. how do you think about the newspaper business right now do you see this as a philanthropic effort do you see this as a business that's been hard hit and potentially with the right business model start turning a profit >> i think it's essential that it's sustainable and not as a paper, a newspaper, but as a news media so i see this as journalism doing incredibly important stories, and that's basically story telling. how we publish these stories,

whether it be podcast, digital video over the top, newspaper, is where we need to go as an industry we need to take cloud computing, artificial intelligence, predictive modeling to create something of value to you, not from an advertising model but as an educational inspiration model. so the opportunity to inspire, educate and inform is where i see our newspaper going. >> that sounds more like a subscription business than an advertising model. fair >> fair. completely fair. it has to be, by the way >> how do you think of benioff's sound that we played a moment ago was about facebook how do you think of them, as a partner of media, and also what they have done to especially local media? >> well, i think it's either an unintended or intended consequence of advertising if you look at facebook, it's an advertising facing organization, which then really cannot just differentiate from so-called fake news, real news, opinion

news, and real news. and the short attention span that we are now creating within this millennium is very dangerous. so it's unintended social consequences of social media it's the cancer of our times we need to change that paradigm. you can get short form of real news so there needs to be a whole, i think, new social network that actually can inform this is real news and that's something we have to crack. >> do you see any differences between your approach with "the l.a. times" and jeff bezos' approach with "the washington post." emphasis on subscriptions? yes. on apps, on broad forms of media and story telling. any differences or anything that you think you're going to push on approachwise that you haven't seen them do >> well, they have done a fantastic job, both "the washington post" and "the new york times" have done a fantastic job. what we want to do is take what we can do from california and

really actually engage so we can engage in sports think about us as the sports nation of the world actually e-sports where the millenia are, so that's why i've gotten involved with not only e-sports but the game publishing. so we can use those tools to really engage. so we're going to engage at many levels, whether it be events, whether it be sports, whether it be over the top. and whether it be just good reporting. >> finally, whether it's you, now benioff, bezos, jobs, have you guys talked about what you're all doing together? >> actually not. remarkably i mean i didn't go to the last aspen conference, which was last week, and get together i think it's wonderful that all of us are now sort of trying to do the right thing, i think, for democracy. >> doctor, thank you so much. >> you're welcome. >> we'll be watching for all your activities and involvement in various sectors appreciate your time. >> you're welcome. >> very nice. >> thank you. coming up, more on why the

instagram founders left facebook but first, rick santelli, what have you got your eye on today >> you know, today we're going to obviously be watching the fed, but in a more macro sense we're going to really try to ponder in search of neutral what it means for the fed, what it means for global rates after the break. >> i think the person to pay attention to is rick santelli. is about doing things right. and there's no shortcut to the right way. so when we roll out the nation's first 5g network, it'll be because we were the first to install millions of miles of fiber optics. and we'll be the first to upgrade the towers and put up the small cells that will power the smart cities of the future. when i started at verizon, i knew i was joining a team that was pushing the industry forward. now, with the launch of the only 5g ultra wideband network, we're doing it again. this time, changing the way we learn,

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it's time, let's get over to the cme and rick santelli for

the santelli exchange. rick. >> thank you, jon. you know, i'm still one of these people, and many on this trading floor are as well, we get pretty excited on fed days. granted, some are less exciting than others. but this one trultruly, i think will be important on a number of levels, not the least of which it will represent another rate hike in the march toward normalcy, if you can ever really go back to the way things were my guess is it will be a modified back to the way things were because as everything has recalibrat recalibrated, it's going to be very difficult to recalibrate back, obviously. and when i look overseas, it even gets crazier. but maybe more specifically, we can zero in on desperately seeking neutral. neutral is important you know, it's that magic place where inflation is neither accelerating or slowing. where job creation is at a level that's not pushing the envelope,

but where's the room you know, at 6% plus, i remember 6.5 and bernanke said that was full employment. it was 4.5 and now we're at 3.9. but there's an assumption in all of this that policy really does in a way that's quantifiable and meaningful have an effect in these two areas in a way that doesn't mean you have to have a boatload of leverage to get the desired effect because there could be a lot of things that go wrong by overdoing certain parts of policy. how long rates are low, how low they stay, how quickly they move up, if the efficacy of what you're trying to affect is small. that's why many are pretty enamored with jay powell and on the road to neutral maybe he is exactly the man for the job. maybe the bigger question even, today the big news was an ally of merkel, a parliamentary leader, was kind of thrown out and the person who replaced him is not an ally of merkel and her

new, weaker coalition. why do i bring that up because neutral may have negative connations with all the negative rates in europe and japan. because once we get there, where's the push going to be for them to normalize? so it's going to be an exciting day. what isn't nearly as exciting, a frequent guest on fed days, one of my favorites, ex-fed governor mark olson he passed away two weeks ago today, and we just wanted to mention that he was a wonderful guest to talk about. he was fed governor from 2001 to 2006 at 43 years old he was the leader of the american bankers association, the youngest leader ever his financial services career spanned 40 years mark olson, thank you for joining us with your opinions on so many occasions. we'll miss you our condolences to your family carl, back to you. >> always a gentleman, rick. very sad news. thank you. "squk awalley" is back in a couple of moments. alerts -- wouldn't you like one from the market

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fidelity. this is moving day with the best in-home wifi experience and millions of wifi hotspots to help you stay connected. and this is moving day with reliable service appointments in a two-hour window so you're up and running in no time. show me decorating shows. this is staying connected with xfinity to make moving... simple. easy. awesome. stay connected while you move with the best wifi experience and two-hour appointment windows. click, call or visit a store today. welcome back no let-up in the regulatory pressure on big tech this week the senator commerce committee conducting a hearing on data privacy. witnesses from google, apple, at&t and amazon are among those facing questions from lawmakers. all of this happening alongside ongoing trade tensions with china, facebook's breakup with the instagram founders and amazon's continuing expansion. are you still with me? joining us here at post nine to dig deeper into all of this,

stephanie meta and the managing director, eric hippo thanks for joining us here today. >> thanks for having us. >> stephanie, a busy week in the headlines. a lot of focus on privacy. how should we think with this? >> i think it's about time finally. this is an issue that's been bubbling to the surface for a year now i think members of congress are finally doing their homework and stepping in. i think the only challenge is that this is not a headline issue that's going to play with bases of either party. immigration, the hearings for judge kavanaugh, these are things dominating the headlines so i think it's going to be really hard to get the voter behind the issues of data privacy. it's not a priority for lawmakers or for the base. >> eric, what are your thoughts? especially when senator john thune comes out and basically says recently that the mounting controversies have fed doubt that tech companies can regulate

themselves and safeguard privacy of our data. >> the first was the realization as to some of the abuses happening with the data that we supply these companies, starting with the cambridge analytica scandal and others as well. iss others as well there's a political movement that started in europe with the adoption of the stricter privacy laws of so-called gdpr and now what we're seeing the states, while the federal government is discussing it and not doing anything, the states are starting to move starting with california. and now they're talking about it the federal government is under pressure now to come up with a law. otherwise there will be a patchwork of laws which will be really unworkable. >> we sort of have that now with cannabis, right? federal law collides with state law in some cases. that can go on for a while, can't it >> it can. except i don't think that you're going to have the ability to

move data, move information if the state laws are different from one another the federal government has to come up with an overarching rule >> stephanie, we talk a lot about regulatory overhang and the problems of big tech, but at the same time m&a has been hot, adobe, pandora that deal got bought by sirius xm look at survey monkey today. what's your sense for the feeling among entrepreneurs and even big companies about growth at least from the numbers it looks to be pretty healthy >> yeah, and i think companies love to complain about regulation and, yes, it is a burden but i think the bigger problem for companies is uncertainty. i think that, you know, if they have a regulatory framework they can work within and they can help shape, which is why i think you're seeing so many of the big companies say we are in favor of some sort of regulatory framework because they want to be part of the rulemaking process. they don't want something hoisted on them. if they can at least understand

what the framework is, i think that's favored over uncertainty, but in the meantime, as you say, the markets are really strong. the environment for m&a, the environment for growth seems to be very strong i think these are almost two things that are happening on separate tracks. >> i apologize for the hard left turn but survey monkey a 60% gain after pricing above the ran range. what's going on here with the ipo market >> well, there's a little bit of a return to the late 1990s where smaller companies, companies that are going to be worth a billion, maybe $2 billion, maybe less, companies that are still losing monkey. survey monkey is still losing money. find a receptive market with the public and that's really encouraging because so far in the past few years it's been those mega ipos, the facebooks of the world

there's a huge pipeline of companies in that range of survey monkey that could be encouraged to be public. we need the public market to continue to grow these companies. >> despite losses, you don't see any danger in companies with operating losses going public? >> they have a real business sometimes back in the late '90s -- >> when you said late '90s that got my attention >> in this case they actually have a business. the top line is growing really fast the investors will have to make a determination as to when and if the companies can become profitable >> stephanie, the other news of the week, more changes at facebook reports today that the founders of instagram left because of tighter oversight or clashes with zuckerberg and others at facebook how should we think about that and the changes roiling that company right now? >> i think the reports coming out seem to reflect what we've been hearing for a couple of months as well which is the

founders' hearts weren't in it quite frankly. we have a couple things at work. founders of companies facebook have acquired have also left these are entrepreneurs. i think these are individuals, unless you are the ceo like mark zuckerberg is of facebook, if you're sitting in a division, you're a couple layers below the ceo and you're somebody that had that entrepreneurial instinct that led to you start a what's app or instagram, i think they're restless and want to do their own thing. the fact they were clashing with the powers above them made it an easy exit for them >> the state of new york tech, silicon valley, entrepreneurs outside of silicon valley, how is it looking? >> new york is booming in tech, doing very, very well. we continue to see a growing number of startups pretty much all fields that you can possibly imagine including advanced technology such as ai and robotics and block chain and others it's a great environment to build a business

huge diversity of everything, people, cultures lots of things to do. people love building businesses in new york. >> guys, thanks for joining us today. eric hippeau and stephanie mehta. the waiting game continues ahead of the fed decision in a few hours. equities not moving around a whole lot. p aos7.is up 42 s&uplmt

former telecom ceo connects with the ceos of the hershey company on "squawk box" tomorrow a cracked steel beam closing down san francisco's sales force transit center causing some commuting chaos. our aditi roy joins us with the latest >> reporter: hi there, carl. the brand-new tower, transit center, has been shut down and is creating a logistical mess in the city it's been dubbed by some as the grand central of the west. the $2.2 billion center was shut down after some workers discovered a major crack in one of the steel beams here. it took two decades to build it and spans several city blocks. the closure comes amid a city building boom here in san francisco. more than a dozen high-rises have been built in the last five years alone.

they include the sales force tower, the tallest in the city, sits adjacent to the transit center and is next to the millennium tower which has been sinking since it opened in 2009. we've been reporting on that the infrastructure issues lead a lot of people to question whether the city is growing too much too fast. this morning commuters are being diverted to a temporary transit center causing traffic jams across the city during one of the busiest weeks here keep in mind green force is taking place that brings 170,000 people into the city transit officials are urging people not to drive into the city and to allow extra time for travel within the city we're not sure now when that transit center will be reopened. back to you. >> structural integrity is important. aditi, thank you very much some news coming in on uber. the ride sharing firm has reached $140 million settlement with 50 states and the district of columbia over the 2016 data breach that breach impacted about 57 million riders and drivers,

exposed their names, e-mail addresses, and their phone numbers. that was one news development in the past year or two that uber does regret obviously. and another speedbump, problem behind uber. fed decision in a couple of hours. a busy day tomorrow on the hill with kavanaugh bed and bath tonight to the judge i'm scott wapner is the blue chip breakout a sign stocks are poised for an even bigger bounce in the months ahead? this is "the halftime report." the theme of the hour is big. a big run for big caps as we close out the quarter with stocks like pfizer and apple up 20% or more in three months. what's going to lead in q-4? plus a big call on big blue. we're talking ibm. and get ahead of the fed with two hours before the big decision "the halftime report" starts right now.