will be really key here they do this well. >> thank you farmer jim >> alaska airlines i flew last week airports are packed. this one does not rely on business travelers >> the man who threw half the team under the bus today has the last word. quick. >> bank of america >> thank you so much the exchange is next thank you, scott and hi everybody. i'm kelly evans. here is what's ahead today monday's mega media merger two giants joining forces in an effort to take on the streaming kings. will the attempt to combine assets give them the upper hand or leave shareholders holding the bag. the market appears to be treating we'll look at what that means for stocks going forward

maybe that's constructive overall. the dow industrials off about 90 points you can see the s&p down about 1/2 of 1%. 13,313 level for the nasdaq composite off nearly 1% here the under performer. that back and forth between whether the nasdaq becomes an out or under performer continues to play on on the macro side of things, we're watching continued move higher for gold prices we're now over the last few weeks, several weeks about 10% higher than we were at the lows over the course to have last cup of months. watch the gold trade 1868 the last trade there. above its 200 day average price for first time since february. we're at the highest level since part of then watch that particular trade. inflation fears may be playing a part in that discussion. take a look a t real gold and

then digital cold. that's what some people like to call cryptocurrency. we're at naear the lowest level we have seen at one point we were at 51,000 or thereabouts roughly per coin on friday. a move lower there in bit coin prices coin base global now below the 250 dollar reference price from the nasdaq direct listing tesla off about 3% on that particular news and in square, a couple of the larger companies that have bitcoin business exp exposure.

well, the merge erp of discovery and warner immediate w will create one of the world's largest media companies valued at $150 billion, including debt. the deal which is expected to close mid 2022 come bieps b-- combines the two companies with a combined $20 billion in conc content annually the deal aims to unlock the value in warner media direct to streaming consumer business. netflix has the broader streaming about 208 million streaming subscribers. disney plus has some 90 million.

discovery plus has 15 million subscribers. at&t shares moving today they were up about 1% while discovery shares were up as much as 9% earlier this morning than falling down into the red. back over to you >> it was interesting to watch them turn negative when david was doing the interview with the ce ceo this morning was it something they said that seemed to not have gone over well shareholders initially cheered the deal it does make lot of sense for the companies to focus on what they do best >> it does i can't inpoint exactly what it was. i think the fact the dividend is being cut. i think that's the question there and the question of what the future will be for jason he's the head of warner media now. there's headlines he's hired a legal team to help extra indicate himself from the company because there's not going be a role for him at the new kpaep. there are questions about what the new company management team

will look like it will be interesting to see how this all plays out i can't what the comment was the shares down several percentage points. it will be fascinating the see how this plays out it does seem it will be able the move forward without any real challenges >> all right appreciate it for now. let's talk more about the share price reaction and whether the spin off will create the streaming giant that at&t is hoping for he's a corporate media reporter for the new york times and a cnbc contributor

why do you think discovery share h -- shareholders, what do you think are the concerns are >> i think they are probably just responding to the ambition of the deal and the fact that deals of this size, of this magnitude are very hard to pull off. you have issues of culture off an awful lot of debt in the new entity that need to be serviced you have concerns about what's going on in larger streaming land landscape. there's a lot of uncertainty along with the possibility that this represents to >> he thinks it will a free cash flow machine over the next two

years. what do you think are the existing concerns are? what are think still, do you think? ed, go ahead >> he's talking about the money that warner media and discovery spend to create shows by sports rights all the traditional linear stuff. how much of that is really going to be ported over, allocated over to its streaming business because hbo max as well as it started, it's still to most expensive service out there. it hasn't risen as fast as disney plus has.

it's unclear the amount of money they want to spend to devote towards streaming. it's the future which is the linear business. if the reaction is the result of this sort of where the money is go going, i think that's the biggest question >> that's a great point. why do you say in response to this deal while there are some concerns about this new company say netflix needs to do something. why do you think they are now threatened >> because the competition got a lot more intense and it has gotten a lot more intense over the most recent months with disney plus and with warner media now joining forces with discovery. you'll have a lot of pressure on

top talent trying to get the best shows out there so you can reduce your turn and add to subscribers. they want to get in on that bundle having the best content will be more important than ever netflix has some advantages because they were there first. those advantages might not last. >> to that point, as you note here, this company will be a bit combined new company which hasn't been named yet will be bigger than netflix or nbc universal, our parent company. they had $41 billion in sales last year, 10 billion in operating profit this is real competitor. what does it mean for the likes of amazon prime that made headlines with the nfl thursday night package or apple which continues to have tv ambitious

b -- ambitions. >> i'll tee off of brent's point. he made a great point about hollywood talent there's a limit to the talent pool that's out there and they are fighting to do deals with the big players. netflix started locking down people like shonda rimes, ryan mu murphy i think this is a smart move in the sense that discovery with david at the helm, he's an old time media guy he understands media and he will set up his office in a lot on warner brothers studios. he will work closely with talent in that way, it's a positive sign for this new entity that will have not just the muscle but the personality. media is really driven by pers pers pers personalities. he's one of the old guard. that's where they might have some advantages.

>> brent, do you think this could bring someone like christopher no land back on boad if they are able to refresh the culture? >> i think it might. >> jason has hired a legal team to negotiate his departure a lot of changes here. thanks we appreciate it coming up, the market retreating from recent extremes so has inflation anxiety peaked for now? we'll have a closer look at whether we're in a reset it's a key week in court for epic gains versus apple. tim cook is set to take stand. we'll look at the fireworks that's expected. we're back in a moment

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. welcome back it had been a market without the middle ground from key sell offs to over valuation inbounds investors went from the fear of losing everything to the fear of mi missing out on everything. as the rebound slows, the economy of extremes seems to be calming down for now >> seems like things are a

little more in balance but that happens through low r share prices take a look at the s&p 500 this looks like those that began in late january, late february 3 to 6% to the down side and where the s&p is right now a right where it was a month ago except at the same level about a month ago in mid-april, things were looki ing very over stretched. the market was up 8% in you're looking at investor surveys. seemed like people was over aggressive that mostly had opinibeen moderd now. we got so much spengs. the bond market has not really registered a tremendous amount of alarm about the inflation

>> i think it's the most important one that we know about in advance that's the known kcatalyst the employment numbers will be really important that will either restart or calm down the fed taper talk. >> what about washington headlines? part of the inflation concern seem to be this idea that all of the spends, whether it's paid for or not will ultimately become inflationary. in that sense could market that rarely reacts to washington headlines be touchy on that front. >> it would require a fast path to a big new fiscal package. that seems very unlikely now in a few months we'll be talking about the fiscal drag for 2022 >> by the way analogous to the

market as well as soon as you start to look out, it becomes difficult. thank you for now. >> let's talk a bit more about how likely this retreat from extremes is to last. jim, it's good to have you here. let's start where we left off with mike on the inflation situation. you're under weight inflation length bonds why? >> they're pretty expensive now. it's a better way to get some inflation protection but also benefit from growth in the port portfolio. tips don't benefit for growth. >> would it be fair to say you're not expecting 2.6 inflation. are you saying you're taking the over or would -- >> exactly if you think inflation will be about 2.6% over the next ten

year years, tip make sense. you should look further assetings to get your return. >> what you're describing would be more of goldilocks scenario for stocks if we say in that 2, 2.5% range, it will be better than the concerns going around right now on the inflation front >> exactly if you look at the lifhistory of stocks, they can do fine with inflation up and companies have pricing power. they tend to do pretty well in that environment p/es don't get hurt too bad. we're in a 60/40 portfolio 68% risk assets and 32% in bonds because we do want to be positioned for growth. we want to understand the inflation sensitivity of what we own and that's why we would favor national resources for example over tips. >> somebody has the view you do of inflation which is it's not going to be hyper inflation but it will be plrn we have seen recently what do you do with things like

high valuation, tech stocks and tern part of the market more exposed to that trade. can you own that >> you can we're neutral technology stocks and communication services stocks which would be internet names in this environment. they are long term growth characteristics are terrific it's clear that the rotation in the last six months of the value probably has a longer way to go. i don't think it makes sense to make a big bet to go under way technology because the long term fundamentals are so attractive >> do you think the fed has to throw the breakes on. >> unfortunately or fortunately that's not going to lead them to do that. it's the unemployment rate and

it's what we see on the inflation front. even if we have really good growth numbers, if the job numbers come in and they continue slow manner, they are going to be very patient this is one of those interesting times where bad economic news actually might be good market news because it means the fed will be more patient as mike was talking about the fact the infrastructure plans are probably getting pushed out. that's another area where bad news is probably good news for the markets. the converseis on the inflatio front. bad inflation data will be bad for the market >> final question, you sort of put all this together and look at the frothy areas of the market, the spac activity has cooled down this week and will be an interesting test of that i don't imagine that's something you'd have exposure to but would you have advice for inverstinve. >> there's been rolling rotations and deflations that we have talked your program and elsewhere and with our clients

really over the last six to nine months about money losing stocks being run by retail i vnvestors the overall corporate valuations and the stock market are a little bit high which means they probably reduce long term returns. >> jim, thanks for your time a new housing report comes with a warning for home buyers. hotel stocks getting hit today but this travel name in the green. we'll tell you why, next you can watch us live on the go any time using the cnbc app the exchange is back in a moment labradoodles, cronuts, skorts. (it's a skirt... and shorts) the world is going hybrid. so, why not your cloud? a hybrid cloud with ibm helps bring all your clouds together.

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down 26% this mons the worst monthly decline since the public debut some other hotel stocks under pressure mar began stanley saying they should get a boost in the summer months they are saying that china's travel recovery could boost some of these names more than 30%, including trip it's about 4 % lower today. let's get to rahel for a news update >> president biden will announce the u.s. is sharing 20 million covid doses with the world they will come fromexisting u.s. production of the pfizer and moderna vaccine or from the stockpile of johnson & johnson shots. that's on top of previous

promise to share 60 million doses of the astrazeneca vaccine which hasn't been authorized yet. as the conflict continues, biden's secretary of state spoke with jordan's foreign minister take a listen. >> palestinians and israelis, like people everywhere, have the right to live in safety and security this is not an israeli prifr ledge or palestinian privilege it's a human right you're now upto date kelly, back to you thank you. coming up, twitter tackles tears and epic court showdown. italy welcomes americans that's all ahead in rapid fire let's take a closer look at the crypto space

bitcoin having a volatile day. it's lower and down about 33% off of its highs ethereum lower today as well we'll have more on all no in a moment stay with us with on "the exch exchange." what happens when we welcome change? we can transform our workforce overnight out of convenience, or necessity. we can explore uncharted waters, and not only make new discoveries,

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welcome back it's that time let's catch you up on couple of stories that need to be your radar. it's time for rapid fire first up over the weekend, tech blogger tweeted some discoveries about twitter's coming subscription service the upcoming product will be called twitter blue. they are pricing it at $2.99 a month. this will include paid features like undoing tweets. the shares are flat year to date but more than 35% down from their 52-week high i like how wong made a name for herself reverse engineering this

popular apps to discover what features might have been coming. people have said twitter should do a subscription service. >> just roll out the subscription service we have been talking about this new program. it seems like there's been functionality they have been testing. i think it's time for twitter to make the announcement. tl there's a need to boost engagement >> that's kind of my point about twitter. i want to know what you think. are many of these changes innovation is it comes from more of a position of weakness today than one of strength? >> i think it's absolutely position of strength they've got, had a product that came on day four who engineered a total reboot of product culture. they are shipping new products at a furious pace and i would

say user growth is a metric we use for advertising base company pps subscription base companies have different pmetrics we shoul pay attention to people on twitter are hard core. offering these new features for more e money is a great way to boost revenue. >> companies or subscription services like netflix, we still rely on using growth it seems to be about engagement. is twitter at a place where it can afford to put up any walls >> yeah, i think that's really interesting. what is number one thing is a bunch of analysts want you to do, add an advertising business. netflix user growth metric is tied to their one core line of

revenue which is subscriptions >> obviously culture of experimentation like amazon had can foster experiences like the echo dot would you pay 2.99 a month >> sure. that's not much money. i would give it a roll we just mentioning analyst, i spoke to one smart analyst he saw this as another sort of experiment that twitter management has been doing. it's an ad based model there it's improving interesting, this has a neutral on that stock. i asked why and it kind of relates to this. he gives them props for their

cfo. he likes their record of product development but he is still cautious in part because he says their record right now, in his opinion, okay, not great >> seema, i'll give you the last word sd >> if josh will pay 2.99, i guess i will as well i follow his tweets. >> let's move along. it's the third week of the epic versus apple court battle. they are all about apple with the ceo taking the stand i think it's approved in the app store. >> apple is testifying he's a long time apple executive insider. he over sees the app store he actually over saw for 20 years product development of the iphone maker so the testimony will be critical a lot of people will be paying

attention. a antitrust lawyers say epic has a high hurdle here the burden of proof is on the plaintiff. in this case that would be epic. it will say the judge in this case is one who has sided with apple in other cases at tend of the day what epic is asking for here is not money they want to judge to change the app store business model lawyers cho have been following this case is something courts, at least historically have been h reluctant to do. >> we're learning a bit more about what apple thinks of this. we have the e-mails from 2011 with mr. shiler, i believe it's phil, the former marketing chief who is talk about how sustainable their current sort of revenue planner is. the 70/30 split. 70% goes to apple. also you have the issues about sort of epic reliying on expert analysis about what apple's

profit margin is the argument is if it's north of 80% or something like that, it's supposed imply they have monopoly control >> it hinges on a lot of very entertaining esoteric debates about what is game, what is a pl marketplace, what is a metta verse. i think epic knows that the united states government is taking a hard look at these big tell me companies. there's e-mails point to someone that is imagining a more competitive marketplace. what we're really seeing a ton of evidence from inside of apple in their e-mails about how much

control they exhibit over the core functionality of applications on their operating system whether epic wins or losing, that amount of control will come under a lot of scrutiny. >> that's what you have to wonder if regulators will finish the trial this court trial doesn't finish you also have to wonder what it will be like to hear from tim cook himself i think he's expected to testify just shy of two hours. >> i agree the most powerful technology company with $2 trillion market cap. he's known for his patience. what else will we see from tim cook i'll be sure to ntune in. >> do you think investors are flum moxed by this i would seem like a huge deal. i wonder if they will go we're in this for the very long run. somehow apple will figure out a way around this and whether to take 30% or 15 that it will still be profitable for them.

the if squuj says you can't get in the way of app developers and their customers, that will be a big hit to apple will they be able to solve it? yes. they are very, very smart. they are very good at business >> kbha do you think apple would say about that >> the big risk is the judge rules against apple or forced to make some type of concession

this is probably the first round. he thought it would be like asking who will win the super bowl in 2024 >> shareholders are betting down about 1.5% today if you're looking to get away, americans can travel to italy this summer. the country is ropine reopenin tourists >> italy is open to americans. they have to fly on these dedicated flights hosted by delta, american from new york or

atlanta to rome and milan. you have to test before and upon arrival 37 if if you test negative, you can head to your favorite bar. we're going to get lead of this especially as bookings activity on priceline and expedia suggest as more americans get vaccinated, you're seeing them book travel internationally. italy saying let's get lead of that and provide more options to the consumer the american tourist, there's this reputation we tend to be noisy when we go do europe but we're in incredibly popular tourist to get we're the most vaccinated out of any other country. they want us they want us there

>> interesting my parents watch so i shouldn't say this but i was thinking would ta be a great surprise gift for them to say italy or europe after we have been doing so much the last year and a half of taking care of each other and there's child care and you can't go anywhere. would you get on one of these planes >> i like thinking about in terms of supply and demand you have to do things to reduce your demand. i think there's a lot of people who have been at home for a year who have money to spend. they haven't been spending it the way they used to yeah, i think it's great i think the one question i want to know from all these country, the airs, if things start to turn, are they prepared to quickly shift back that's the thing that will actually protect us over the long run so far that question hasn't been

answered >> i would be on a plane to europe in a heartbeat. it sounds fantastic. i know you can relate to this. i have a 2-year-old. i'm not getting on a plane with as i un sydney jane lipton at this time. dr. gotley was on squawk box he said this summer he is comfortable traveling to europe. i wish i was one of them >> that's great point. i can see you as our rome correspondent. maybe we need a special toddler safe flight to get everybody over there >> that sounds good. sign me up >> there's some buyers remorse 64% of millennials say they have one regret about purchase thaer new home most are that main nans and other costs are too high the location is too high and they bought too small or too big of a house >> this one, i'll be interested

to see what they think i don't want to come across as old guy screaming on the lawn. there was a couple of points i didn't understand. you didn't recognize when you buy a house that it gets expensive really quickly >> it's really expensive it's full of surprises >> some of these other surprises. some significant number of people who said they didn't like the new location i thought that was kind of weird too. test some weekends >> the problem is every one was kind of forced to buy in the market the past year or so i saw some of houses they were buying and going they don't know about the backyard or how busy that street is it's better than the alternative. >> is it people were like i can sell my house for twice as what i made and you'll buy another house for twice as much. >> we have to go but i want you

to get the last word >> the millennial always striving for perfection. never happen they got a house and they're a millennial they should be proud >> thank you very much coming up, cannibas stocks have been making a comeback with record marijuana use next year it's been on an aggressive b buying spree a reminder that may is asian american and pacific islander heritage month we're spotlighting contributors, business leaders and our on air and reporters. here is tony zhang >> try not to focus on what others think of you. don't be afraid to explore and establish what your own identity is american culture is so diverse you can really find and be able to take advantage of what makes you unique and per sue what

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welcome back i want to show you what's going on with shares of discovery now at session lows down 5%. these were up 10% this morning after that deal with at&t was announced. 15 point swing for disco right now. at&t going negative in the past half hour. it's now just about flat on a session and it's given up earlier gains. we'll continue to watch it cannibas company columbia cares hit profits. shares up 300% over the past year the pot stocks had a rocky few months could industry consolidation like tilray's recent acquisition get things back.

it's great to see you. thanks for joining me. is there all of a sudden a lot of consolidation happening here? >> there's a lot of consolidation. it's one of the most attractive markets out there. there's a huge incentive throughout the country >> what's driving your record numbers here is it the increase inwe're seei something fueled by the pandemic >> tings a combination of things we had an 89% compounds growth rate for revenue since 2017. we really haven't seen anything but the growth rates increase as time has gone on you've seen a general sort of acceptance of cannibas nationally you've seen a lot of people think about cannibas in a completely did i have light. it's a combination of things

smst something that seems to be ubiquitous across markets. >> sounds like you're wanting to be at the fore front of the consumer's mind of this product. period is this, i don't know if it's a pivot but emergence from specific medicinal product into something that's more mai mainstream >> i think it's a will the of that we spent years trying to find the right name i chose columbia care. we chose it for a very different set of reasons back in 2012, 2013, it was a medically driven industry in each individual state. what we wanted to do was but unapologetic we were the place to go and when people are trying to get into the market for the first time and people interested many the market or have been in the market, where else wrould you

go it was a little bit like calling a shoe a shoe. it was when we finally -- when the light went off it made all the sense in the world >> i wonder where we are in terms of your expectations about legalization federally how important is it for legalization federally how important is that to happen? i believe you have a credit card deal where the financial access for cannabis is challenged because it's still illegal federally speaking what are the expectations around a change in -- >> we have been a big fan of doing things in a way that's sustainable and lofty aspirations need to be tempered by the environment you have a lot of diversity and inclusion policies in the programs and so we've always believed for a long time that

cannabis can be a contributor from tax and jobs but we are hopeful that the federal government thinks about the industries kree created for opportunity to be very hard to replicate with a broad approach. >> please finish so we think there will be incremental improvements but it could take any number of forms. >> right i think this is investors thinking through this, is it like a food products business, a technology business, like a health care business >> it's a great question we grow like a technology business margins like a steady business, health care business but we are an emerging market and in the

most developed market in the world. california, new york, florida. so watching our growth pattern's different than taking -- normally associate with taking with this type of growth. >> it is fascinating. thank you. appreciate it. >> thank you. new housing numbers today why not good news for home buyers we'll tell you why right after this

welcome back broader markets haven't budged take a look at shares of media companies like comcast our parent down almost 6% charter down and disney nearly 3 prs following the discovery/at&t deal and discovery is at session lows this hour. sentiment with the homebiders high in may but this month's report with a warning. diana olick has the latest diana? >> reporter: the warning to die buyers is get ready to wait. traffic is slipping slightly and sales expectations over the next six months rising but

construction up 12% from a year ago not just pushing home prices higher but some builders are slowing sales to manage their own supply chains which means growing affordability challenges for a market in critical need of more inventory say buyers should expect rising prices in this year soft wood lumber falling last week but up over 300% from a year ago steel double price from a year ago. gypsum up 13%. and copper up over 90% this builders say the increase in lumber adds $36,000 to cost of construction and not just prices but delays. we have been using this house as a backdrop for a moth but nobody's out here building a neighbor said they have issues getting lumber. >> we spoke about millennials

that regret the home buying. what are your thoughts on that >> reporter: look. everybody's got a couple regrets. didn't say it was total buyer's remorse but pleased to be in larger homes given thepandemic but everyone's going to have a regret and it is the costs to to be careful about going in especially if they have to upgrade. >> exactly with everything that you just outlined that's a real problem good to see you. thank you. that does it for us today. next on "power lunch" elon musk sending bitcoin on a wild ride again. i'll join tyler mathonft isui bakshed,r you can finish. - [announcer] finish your degree at snhu.edu.

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hi, everybody. welcome to "power lunch. we have a mega media merger. at&t joining discovery both stocks falling intraday elon musk moving markets again bitcoin tumbling and then rebounding a little trying to clear things up. does he have too much power? plus a major spending shift is likely about to happen spending th