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good monday morning. welcome to "squawk alley." i am carl quintanilla, morgan brennan, a brennan. the first story, more than two dozen attorneys general expected to announce antitrust investigation into alphabet. ylan mui has more from washington >> reporter: good morning, carl. we expect that formal announcement from the steps of the supreme court at 2:00 p.m. it is the largest coordinated effort to take on big tech we have seen so far attorney general of texas, ken paxton, a republican, is leading the charge this will be a bipartisan investigation. we have a statement from massachusetts ag maurahealey she said online advertising is everyone this will center on three big

questions. has google engaged in behavior that stifles competition, restricts access, harms customers. we're told the investigation will include demand for google to turn over documents related to the advertising business. hoping to get more specifics on how states will frame their case at the announcement later today. google issued a response help people, create choice, and thousands of jobs. it is one of the top spenders on r&d, making investments that support innovation the company also acknowledges it faced a lot of scrutiny in the u.s. and overseas. google says the justice department asked about past investigations, and expects state ags to do the same back to you. >> thank you very much try to get clarity on this from one of the attorneys general out of florida, but have to wait for the announcement for more. let's bring in kara swisher, recode editor at large cnbc contributor good to see you.

>> hi. >> stock is up how much do they need to worry >> this is something that's been building, they have a slow burn like microsoft and others. the question is they're being hit by the states attorney general, justice department is looking into this, european regulators, the u.s. is just catching up to what everybody else has known which is we don't have competition in search hasn't been a new search engine since forever. same thing with social media and the online advertising market is really a duopoly of google and facebook and there's damage being done to lots of startups. >> seems to me that google and facebook tend to win when you talk about users, who likes to use the platforms. it gets more dangerous when you talk about the advertising market, the power they have, whether they're advantaging their own products over competitive products, things like that. >> right but this is not a new thing,

yelp has been complaining for years. >> they were the lone one crying out, base camp is now complaining about them >> the fact of the matter is when is the last time blank. i wrote this recently, when was the last time there was a new online advertising major power, last time there was a search engine or social media network 2011 for that one. for snapchat under siege from facebook facebook recently announced as they begin to integrate instagram into facebook platform, a version that snapchat already has i think smaller players have a lot of reason to complain about it, and then the question does it hurt customeronsumers, even like it, they're able to provide those prices which is free essentially because they have the monopoly it is a complex time for these companies and they need to be very careful because regulation is coming obviously. >> i realize we'll get more details on the state attorneys

general and probe into google later today at this event. that being said, i mean, you already have federal regulators in the u.s. taking a look at big tech the fact that you have the state attorneys jumping in with a separate investigation, how unusual is that? >> not at all. that happens all the time. there's always these things happening and they come in a confluence, and the interesting thing about states attorney general, it is bipartisan. it has been that same thing in washington the only thing everyone agrees to is big tech is powerful the reason for doing it is different on the federal level, with conservatives saying they're being too liberal, liberals saying they're letting too many russians in, but it is the same theme which is these companies are too big and powerful, too much control the question is what's the remedy that's the big question. where is the remedy. it has to be coordinated among federal and state but they can't

just do consent decrees, facebook violated it, paid a fine they have to have real laws on privacy and competition that will set the rules for the road with these companies, which i need to stress again, there aren't rules for the companies ever, except ones that help it the question is where are the laws >> the camera will get a tight shot of the pin on your lapel which references alphabet. don't be evil. is that a signal that they have more liability than facebook on this >> i think they all do i don't know i think they have more dominance of that particular marketplace so they're all going to say anyone can leave at any time, that's their statements, right, that it is free and this and that, but free ain't free, let's be clear on that >> that's users, not advertisers. >> if you're an advertiser, you can't leave anytime, you have to deal with google or facebook,

chances are both to reach the audience you want to deal with i think part of what's happening here that's interesting to me is that it is bipartisan. but seems like it has to breakdown at some point when it comes to remedies. these companies will try to play one party against the other, talking about loss of jobs in california, which republicans don't so much care about or something on the free market side this bipartisanship won't last forever. >> loss of jobs thing, it is like look, amazon didn't make it here in new york, now they're hiring a ton of people here. how many gimmes do you want to give them. at the same time, they're innovative, but new companies need to come forward the argument they're so great and we love them so much goes only so far. we need new companies to bring new things to be competitive competition is better with more competitors. prices are, everything is better

with more competitors. >> good stuff. >> thank you >> kara swisher. coming up, we are one day away from what some say is apple's most important day of the year the announcement of new iphones, clarity on streaming service and upgraded apple watch, arcade more we'll breakdown what's eecd moowxpte stay with us t's going on. i've done all sorts of research, read earnings reports, looked at chart patterns. i've even built my own historic trading model. and you're still not sure if you want to make the trade? exactly. sounds like a case of analysis paralysis. is there a cure? td ameritrade's trade desk. they can help gut check your strategies and answer all your toughest questions. sounds perfect. see, your stress level was here and i got you down to here, i've done my job. call for a strategy gut check with td ameritrade. ♪

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we are about 26 hours away to apple's highly anticipated product launch just that far away, amid headlines of a potential chinese labor law violation, a report out of the times that apple stacked its app store with its own apps at the top of search results. joining us for more on apple, dan ives has an outperform rating on apple. also with us, shawn harrison, research analyst who has a read on the stock good morning dan, it has been about what, almost 8 years since "new york times" did a story on foxconn and apple and labor conditions in china that first raised all of this to the fore, having to do with safety, working conditions, underage workers apple changed a lot since then

now there's a recent story about potential labor violations is this going to effect stock? >> i don't see it effecting stock but speaks to the broader issue with foxconn in china, up hill battle for apple with issues from years ago. ultimately for them, they bet the farm on that facility, so this is obviously a bad pr situation, but in terms of stocks coming down to china and any sort of turbulence, i view this as background noise nonetheless, does speak to the importance of foxconn china. apple is the poster child for u.s., china trade battle. >> apple says most of the child labor allegations are not accurate looking for more details there how do you expect iphone, apple stock, to act this cycle of the iphone on one hand, analysts i am talking to, a lot expect after launch, up tick of iphone might be weaker, there's a 5g phone

people think is coming then at the same time a 5g phone people think is coming haven't had a major iphone and network upgrade since iphone 5 that could be big. which are investors going to react to >> i view tomorrow as essentially for lack of a better phrase nonevent. expectations are low for the new iphones, it is an iterative upgrade with better camera which is great, battery functionality, a few small upgrades as you said 5g iphone is coming next year. only those that want to be on the cutting edge of new iphone on the upgrade cycle or if you need a new phone is going to be the driver, versus waiting for what 5g represents in the iphone in 2020. >> dan, do you agree, a nonevent tomorrow >> i disagree. fundamentally it comes down to a third of the install base, 900 million with upgrade opportunity, 60 to 70 million chinese consumers. to call it a nonevent, this puts

fuel in the tank in terms that upgrade, key catalyst especially in china missed out on the last upgrade cycle. triple lens will be keyed as putting a fence around chinese consumers. i think for the stock it is important in terms of trying to show some growth going into fiscal 20. >> we talk about 5g as a notion. what features on the phone will motivate you to upgrade, given how expensive some are now >> if you look at where they -- a bit of a mistake on the last upgrade was on the lens. you have triple lens in the back camera is key. that's what cook will talk about tomorrow and talk about ai functionality around video which is going to be key as well as shatter resistant technology built into the hand set >> michelle, what about the argument that yeah, maybe

tomorrow doesn't matter for iphone, that doesn't matter for the stock. this cycle only matters for four or five months then people look to 5g you would be foolish to sell off apple based on this cycle when you've got a big network upgrade coming in a year, right? >> i think that's correct. it will matter short term as long as it is not a mess you had iphone cuts past two years that negatively effected the stock. if they're better forecasting demand this year and that's generally in line, best sign they can hope for, that's more key for stock than short term versus whether it is a few million units higher or lower. >> why the hold? >> the hold is a fundamental -- iphone to me isn't a cat last this year, you have a long period before the 5g launch. until we know up tick grade on services coming in the fall, this iphone isn't a shortfall

which has been the past two years, i don't see a reason to sell the stock at this point. >> dan, meantime you have a head line out of "new york times" how apple top rivals in the app store it controls. we talked about tech lash, regulatory scrutiny, some big tech companies and whether they've become too big, monopolistic, et cetera. how big a risk is increased scrutiny to apple's app store? >> i view it in terms of antitrust spectrum we view amazon and apple more as least risk where facebook and google we put more risk in terms of that. what you're seeing is in terms of the app store, don't view it as a risk. you'll see focus on it, but fundamentally for investors, i view that more as background noise where you view facebook and google more front and center in terms of antitrust. >> shawn, do you agree >> i agree apple eventually has to get paid

for providing the platform for people to use the apps, shouldn't be as front and center as other services being investigated >> all right dan, shawn, thank you. >> thank you a fifth person dying over the weekend of a mysterious lung disease linked to vaping, prompting the cdc to warn against e cigarettes as the agency investigates. aditi roy has the latest from san francisco. >> reporter: hi, morgan. federal regulatory pressure on juul continues to mount. the fda released a warning letter sent to juul this morning. the letter alleging that juul's marketing practices represen that they present a lower risk of tobacco related disease or are less harmful than one or more other commercially marketed tobacco products juul has 15 days to respond to the letter meantime, the cdc warns people not to use e cigarettes as they continue investigation into what's causing that mysterious

lung illness after vaping. they looked at 453 cases five deaths confirmed in california, illinois, minnesota, and oregon cdc investigators believe chemical exposure is likely associated with the illnesses. many cases involve recent use of thc products, some reported using both thc and nicotine containing products, a smaller group used only nicotine products the cdc says no device, product or substance is linked to all the cases, and in response, leading e cigarette maker juul is monitoring closely. to be clear, our productsdo no include any thc, compound derived from cannabis or vitamin e compounds like those found in thc products some say it is in black market, copy cat products. the cdc is looking into that, adding people shouldn't be

mixing products. juul has until next may to submit fda application for premarket approval of its products back to you. >> thank you coming up. is the vision fund starting to show cracks? and former chief strategy officer imran khan joins us omfr verishop woman: my reputation was trashed online.

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welcome back deirdre bosa joins us with more. >> it is a major task for moasa son and two new reports indicate it may push out ipo at valuation of 20 billion, less than half

the 47 billion last put money in could raise doubts about the play book which is invest in companies right for ipos throw hundreds or millions at the company, taking big stakes at big valuation, take said company public for a higher price. finally, reprofit for vision fund one use it as evidence to raise more money for vision fund two, except that's not the way it is happening with two funds biggest, highest profile investment uber is trading well below ipo, and level where softbank got in, putting that investment underwater could lose more money on a wework ipo, or be required to put in more capital. the aggressive rate plans requires another capital raise stands to miss out on $10 million if it shelves the ipo. that's up to $6 billion in debt that's contingent on the ipo

there's another option could potentially raise more money from softbank to buy time. masa son said he expects to keep backing wework in the future the question now is will he do so, even if it means showing cracks in the vision fund strategy let's get to sue herera for an update. >> hello, everyone here is what's happening the coast guard made contact with four crew members trapped inside that overturned cargo vessel off the coast of georgia. it overturned sunday morning there were 24 crew members aboard the ship, 20 of whom were now rescued. firefighters battling a wildfire burning in utah the metal creek fire broke out sunday officials say sparked by a lightning strike probably. it scorches 1200 acres. no homes or buildings are threatened by the fire.

the party of vladimir putin suffered big losses in moscow elections as candidates endorsed by his opponent won almost half the seats. sunday's vote grew in prominence when authorities refused to register a dozen independent candidates, including well known kremlin critics. pope francis arrives for the final stop of his african tour he was greeted by a large crowd that lined the streets outside the airport. you are up to date guys, back downtown to you carl >> sue, thank you very much. the meeting with prime minister boris johnson talking brexit hours before the leader once more asks parliament for permission to call a fresh election willem marx has more. >> reporter: he wants to suspend parliament later tonight, not before he calls for the second time in one week for a fresh

general election he says that's the only way to break current deadlock yet found himself in dublin earlier talking to his irish counter part about alternative arrangemen arrangements known as the back stop she negotiated with the european union. as you imagine, big concern for investors and businesses remains a possibility of no deal brexit. legislation is to block that happening end of october should be approved by the queen in the next couple hours at that point it will be down to boris johnson to persuade opposition lawmakers to give him the chance at national poll between now and october 31st, if it is to be easy for him to take the uk out of the eu on that date >> so much brexit drama we are watching in the states as you are there, thank you when we come back, ceo of

polaris is here on how trade and tariffs are impacting his business, brought models outside that you've got to see dow up 84. back in three minutes. it was sophie's big day. by the way, she's the next mozart. as usual we were behind schedule. but sophie's enthusiasm cannot be dampened. not even by a run-away donut. we powered through it in our toyota prius.

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welcome back to "squawk alley. polaris is the largest power sports company, celebrating a 65th anniversary here outside the new york stock exchange with quite an array of new products lineup i am joined by the chairman and ceo, scott wine. thanks for joining us. >> thanks for having us out here exciting day celebrating the 65th anniversary as a company, 24 years on the stock exchange fun day to ring the bell. >> in terms of ringing the bell and meeting with investors, what's the message >> the message is how well the company is positioned. the portfolio of products as the world largest water sports company, investment in productivity, technology, 30 brands we have, covering so many different parts of the power sports industry, we're excited

about the future. >> and in terms of future, stock is up something like 5 or 6% today. you have this lineup to begin as being very well received by wall street investors and analysts. i notice you have one of the newly designed raisers out here, there were fires and death related to it. your response? >> it was a one sided, i wouldn't call it investigation our commitment to quality, and i am proud of that how much advancement we made in safety and quality, i am not commenting on ongoing litigation, but we're extremely confident in quality and safety of our vehicles. >> in terms of the new razr, is it newly designed? >> it is an all new product. i think if you look in the interior, you'll see refinement in the cockpit with performance.

that's what we're known for, unbelievable command technology, dynamics technology, we bring the best to consumers in a very, very safe vehicle. >> in terms of this new product lineup, the fact that you are a major manufacturer and consumer facing trade, tariffs, it has been focused for the company you talked about talking to the trump administration to lobby for exemptions what's the update on that? >> it is a dynamic, fluid situation. i'm proud of what our team has done to mitigate tariffs to a great extent one of the things that helps with discussion, we already moved $30 million of product out of china to some u.s. sources and other places we'll continue to work on that as we look for relief. our commitment for relief, we want to protect the american work force the unintended consequence of tariffs is we pay them because we manufacture in the u.s. if we manufactured in mexico

like competitors do, we wouldn't pay tariffs. but i don't want to move jobs to mexico i want to keep jobs in huntsville we put a new distribution center in nevada. we're making commitment to american work forces have 9,000 employees spend $3.5 billion a year in the u.s. it is a good message to carry to the administration, working closely with them to reach a resolution. >> in terms of investments, given that we have seen tariffs, higher tariff rates and another round of tariffs to go how are you thinking of trade regulations and are you optimistic to seeing resolution? >> what the administration is trying to accomplish to get better behavior out of china is certainly something we fully, fully support. we know it takes tough negotiating stance to get there. and i think the latest round of tariffs as the president talked about, new round of negotiations, we feel comfortable it will come to a

better place we're going to continue to push for relief now because we can't wait for that to happen because we want to protect our american work force. >> i mentioned some data around manufacturing has been weak, ism number last week the flip side, consumers seem to hold up. has that been your experience? >> so far power sports industry has performed well we drove price increases more than anybody else. we saw pricey last 'tis tee of consumers are strong talked about the new products, we're encouraged heading to the second half of the year what the summer remaining strong, interest rates remaining low is helpful. so we balance. strength to consumer is helpful to us. >> you entered the marine market over a year ago, the miami boat show couple years ago, folks mentioned moves in the stock market tend to coincide with

boat sales is that actually the case? if so, given the fact there's volatility in the markets, has it had any impact? >> boats are more cyclical, but when we bought boat holdings, we have premium brands in the industry and we manage the business extremely well for our business and dealers. we keep inventory low. when we bought the business, it was returning invest to capital over 100 well run company, premium brands it is more cyclical. we head into an uncertain economic cycle, those brands perform better than most. >> will you see some automated and be self driving? >> the razr, we have a market share of military vehicles for the military they're transportable. we're leading in competition, making those optional unmanned, much safer for the war fighter if they don't have to be in the

vehicle if they don't want to. doing a lot of advances there. the gem vehicle, that's a six seater, we're leading the industry providing autonomy for inner-city transition with that. we don't provide the autonomous solution but the platform for it that's where we see the future nobody wants an automated motorcycle or razr or other products but there's a role for it and investing a lot. >> what about electric motorcycle >> we'll be fast followers there. we like to make money. haven't figured out how to get range and performance and cot to get that trifecta to have a product that will sell a lot we'll be fast followers in that space. >> scott, thanks for joining us. ceo and chairman of polaris on the 65th anniversary outside the stock exchange back to you. >> thank you. when we return, at&t surging after elliott announced a $3.2 billion stake in the company, urging restructuring, while saying the stock is worth

60 bucks a share more on that still ahead. first, imran khan's new venture, verishop, taking on amazon with free one day shipping he joins us here on post nine after the break. event. help people find their way. fastsigns designed new directional signage. ...and got them back on track. get started at fastsigns.com. but when i started seeing things, i didn't know what was happening... so i kept it in. he started believing things that weren't true. i knew something was wrong... but i didn't say a word. during the course of their disease around 50% of people with parkinson's may experience hallucinations or delusions. but now, doctors are prescribing nuplazid. the only fda approved medicine... proven to significantly reduce hallucinations and delusions related to parkinson's. don't take nuplazid if you are allergic to its ingredients.

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i am scott wapner. we have a big show at the top of the hour

we're going to debate the state of tech from ipos that are hot and not. what it means to your money today. also looking to apple's big event tomorrow with dan niles. put a new position on the stock, tell us where he is placing his bets now, noon on the half carl, good to be back here, taking the temperature of tech see you in a few >> can't wait. see you in a few minutes. as you know, elliott is taking a stake in at&t, sending a letter calling for restructuring, sent the stock higher julia boorstin has more on why elliott might be getting in now. julia? >> reporter: carl, at&t struggled with industry wide issues like cord cutting as well as its own specific unique issues based on its big m and a deals. before getting a lift from today's news on elliott, at&t shares lost 13% since june,

2016, over the same time period, s&p 500 gained 46% four key challenges weighed on at&t shares along with roughly $170 billion debt load first, at&t directv acquisition in 2014 came as the pay tv market was starting to decline gave at&t an albatross with shrinking subscriber base for $67 billion, including the company's debt second quarter this year, at&t lost 800,000 video subscriptions. second, the time warner deal for $109 billion, including debt push it into the challenged media business, more competition than ever from stream players, and puts pressure to ramp up spending on original content third, at&t's mobile business faces pressure of industry wide price wars while at the same time bearing weight of the high investment necessary to build

out a 5g network and fourth, management upheaval. the unexpected departure of at&t chief john donovan announced last week follows reports of misconduct, and hbo announcing departure in february. at&t responding to elliott's criticism about all of the issues saying it is already executing many of elliott's recommended actions. back over to you >> thank you and verishop, online retailer started by snapchat's former technology officer announced free one day shipping through end of the year. get your favorite fashion and beauty products fast, no membership fees, no subscriptions, no minimum purchase joining us, the ceo and co-founder, imran khan >> thanks for having me. >> your co-founder worked at

amazon seven and a half years. >> yes, my wife. >> also your wife. can't leave her out. she has expertise of retail. >> she has everything. >> what's the theory of verishop retail is a punishing business, investors are aware of that given what's happening in the markets. why are you going to succeed where others have failed and where amazon is? >> great question. when i told my friends that hey, we're starting e-commerce business, they thought i am having mid life crisis that makes me more excited i think the key thing is internet has a trust problem fake news that you hear about is not only limited to media, there are fake products. all this e-commerce marketplace are full of counter fit and fraud. as a consumer, if you want a product with trust, categories like fashion, home, beauty, there's not a lot of places to go we wanted to build a platform consumers can find the brands they love, discover new brands in one place

for every youtube, there's a netflix. for every sam's club, there's -- >> you think recent stories of third party amazon products that are harmful and so forth, dangerous, is there concern with amazon >> it reminds me of a conversation with evan in 2014 i was thinking of joining snap the conversation was internet was built on the premise of open platform consumers can do anything. it was a global public square. by connecting people, you do good things. problem is when anybody can go and say whatever they want, creates bullying, misinformation anytime there's marketplace where people can post things, you can distribute counterfit products you need a place for platform where consumers find trusted products. >> why one day shipping? is that because amazon made that move and reset the button?

that wasn't a thing you would expect a new company to be doing a year ago >> i think consumers shop for a few reenasons, price, quality, convenience. we want them to have the best convenience. we start with free two day shipping, now one day free shipping we have returns, put the consumer phone number on the top of the site. you can find the phone number. most people don't give you the phone number we want to win convenience, quality, selection >> i want to go back to the counterfeit concept and concept of quality control sounds great as a consumer i had things show up not as advertised how do you regulate quality control, how are you able to do that when other companies like amazon or others can't. >> we source inventory directly from brands, buy inventory, and

take inventory risk. and by doing so, you can guarantee quality. this jacket i am wearing, i acquire it from our site bought it from the brand. >> how do you win? there are costs involved with keeping inventory, costs involved with one day shipping, especially if the stuff is heavy. is there a technology advantage? where's the advantage? >> so i think, you know, first of all, e-commerce is a very large market only 10% of retail sales is e-commerce in next decade will be 25 to 30%. the market can sustain multiple players, and so i think there's a lot of opportunities on that in terms of one day free shipping, you know, over the last 20 years, one thing i learn, you need to focus on customers. rather than focus on profit or

spending money on stuff, we focus giving money back to customers, giving them delight -- >> focusing on profit is not fancy stuff. are you profitable now >> i am three months old in business i think the key thing is if you deliver the best service to customers, they'll keep coming back by driving frequency, you can drive tremendously profitable business it is about creating loyalty we want to make it easy for consumers to shop our site. >> i wonder what you think about the fact that big tech is under the aept trust le-- anti-trust. whether it is amazon or facebook you have roots at snap you've seen that company basically be kind of copied by facebook over the years. do you see that as an opportunity, the fact that big companies are being more closely scrutinized or do you see it as potential draw back if it has wider, broader ramifications

>> i don't spend too much time thinking about antitrust if you look at over the last 60 years of technology industry, there are always big companies ibm, microsoft, then came google and facebook one thing i learned going back last 20 years ofhistory, if yo stay focused on executing and maniacally deliver value for customers, you will win. >> is the market stacked against you in a way that's unfair do you feel you have to pay too high a toll online to reach the consumer, for example, through facebook or google, or is amazon too powerful for you to succeed in e-commerce? >> i think if we fail it will be our own fault because i don't think odds against is is not as worse as it was for facebook amazon got started, against walmart was not easy either. the key thing, i believe when i

was at snap also, if we focus on build great product, great services, help make customers happy every day, you will win. that's why you start with two day shipping, moving to one day shipping in three months put our phone number on top to call us. >> can i ask you a snap question >> sure. >> stock has nearly tripled since you left is this less management churn, app redesign why has it worked in the past year >> marked in general is very emotional. i think look, snap was a product company, focused on product and consumers as we execute. i always talk about it, when i left i talk about evan and his team built a great product team. i can't take credit for the product they build, and continue to build, they'll do well. >> imran khan, good to see you again. >> thanks. major indexes coming off the

first back to back positive weeks since july, dow back in the green. up 72 points, trying to make it three. here are names leading the index higher ckn miten. cat, goldma ba ia nu ♪

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jillion tet. thank you so much for joining me. let's get right into it. i personally think negative interest rates are a new virus in the financial system, but yet the number is growing. and i guess my question to you is, how do you think wall street and the financial centers around the globe will be dealing with negative interest rates when and someday a recession will hit. it's going to make them a lot more unique than recessions of the past. >> i have to say i agree with you that i am not a fan of negative rates. just this morning the financial times published a survey of the biggest bond managers in the world. we're talking about vanguard, fidelity, jp morgan. what this shows, this should be required reading for anybody in the bond market right now. seven out of eight of the world's biggest bond fund managers say they think this can continue without a crash. i guess that's partly because they assume that the economies

are slowing down and central banks are going to just have to keep easing, easing, easing. it's very striking how much consensus there is right now amongst the people actually managing bond funds that this is okay. to me, that flashes alarm bells. but you know that's what they are saying. >> there is a sell side. nowadays, for example, we have banned certain types of lard and grease in cooking. i used to like the cookies with the bad stuff better. they tasted better to me. isn't this just a case of selling product that may not taste as good as it used to, but that's what is on the shelves right now? >> no. i think this is actually mostly buy side fund managers who are saying this. what makes me concerned is that a whole paradigm has come to dominate the investment management world where everyone kind of assumes that rates have been ultralow therefore will always stay ultralow. if you think back to what the

mood was pre-2007, you probably would have had seven out of eight of the big fund managers saying this credit bubble is fantastic. it can just go on and on and on. and the reality is whenever you get the consensus that it is in one direction, investors should wake up and ask questions. >> absolutely and to the point it seems like the sell side wants to sell them and buy side wants to buy them. wall street journal today with strategies on how to benefit from them. but they're cropping up in many publications whether you use forward rates or use them to safe harbor, i guess my question to you is this. with so many wrong way above the price of par that what you have described turns into a riot with regard to how these positions unravel, does it not >> absolutely.

i mean, i'm in the camp of thinking that when money is free, essentially markets do crazy things and that eventually always comes back to haunt you. so at some point i think there will be a shakeout. the problem is as long as central banks are the only game in town keeping the economies going, they are likely to keep easing and investors are likely to keep betting on bonds going higher and higher. there is the old phrase. the market can stay irrational longer than you can stay solvent. do you recognize you can't beat them or do you try to take the stance based on fundamentals and say no. negative yields are not. >> we will find out over time. the next several central banking meetings in europe ought to give us a clue to the next chapter. >> thank you very much. we are seeing the dow up 70 points and financials leading as we are getting some of the

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attorney general jeff landry of louisiana on today's antihfs trust investigation into alphabet as states crack down on big tech. of course, guys, we will continue to watch these markets as we eke out gains and move ever so slightly closer to those record highs we saw during the summer. >> let's get to the judge out west. >> silicon valley, the heart of the tech world, turning out trillions of dollars in innovation and wealth, a wave of big ipos hitting the market this year and more getting ready to go public, but it comes at a time of big tech under fire, the rising risk of regulation and back lash over valuations and diversity in the valley, adjusting to a new reality and finding the next great opportunities in tech. a special edition of halftime report in san francisco begins