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tv   Squawk Alley  CNBC  September 14, 2016 11:00am-12:01pm EDT

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♪jake reese, "day to feel alive"♪ good morning. it is 8:00 a.m. at uber headquarters out west. it's 11:00 a.m. on wall street. and "squawk alley" is live. ♪ ♪ all my friends know the lowrid lowrider ♪ ♪ the low rider is a little
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higher ♪ ♪ welcome to "squawk alley." i'm carl quintanilla. jon fortt and kayla tausche at post 9. mike santoli is here along with confide's president and co-founder john broad. good morning to all of you. our top story is apple moving higher again today, the top gainer on the dow. stock's the number one winner on the dow this week, up 6%. it's been a big few days for tim cook and company, rolling out the latest ios yesterday. sprint and t-mobile reporting historic preorders for the iphone which hits store shelves on friday. cook was on "good morning america" this morning talking about his vision for the future. >> wireless is the future. and so, when you decide on what the future is, you want to get there as soon as you can. you know, why put it for the consumer? well, that plug, that jack takes up a lot of space in the phone,
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and there's a lot of more important things we can provide for the consumer than that jack. we can provide a larger battery. the stereo speakers i mentioned, those were also enabled because the jack is not there anymore. >> mike, someone said this morning, it's been a while since it's led the dow two straight days. it's true. >> well, flight to safety, maybe, i don't know, in a tough market. what's interesting, one week from today is the fourth anniversary of apple stock first getting to $100 on a split-adjusted basis. so, that kind of shows you, it doesn't take a lot of incremental good news just to get the stock moving, because it's essentially been working in kind of a choppy way sideways for a long time. also obviously shows you low expectations for this iphone version. the bold case has been, the installed base of old phones is getting pretty big, maybe upside surprise. so i think that makes sense. the backlash to theback lash on the headphone jack, didn't it come quickly? people saying, hey, look, they're nudging us toward the future here. >> well, i mean, apple is pushing back pretty hard on that. we'll see if people really
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embrace it. i mean, i think we've also got to be careful, keep in mind, the market's not going to get preorder numbers and first weekend sales numbers, as usual, so they've got to react more strongly to stuff like this, these carrier numbers. remember, this is u.s. only. north america made up just over 40% of apple's overall sales in last year's september quarter, a little less than that in the holiday quarter. a lot is going to ride on how asia, particularly greater china, embraces this new phone. and thus far through the year, it hasn't been a good market for premium phones. so apple's going to have to push through that over there. >> of course, they go on sale. the first weekend begins this friday, the 16th. jon, i'm wondering how big a deal you think ios-10 will be. you get snazzier messages with new stickers, you get to delete the original apple apps, but some people are already having problems with that today. >> yeah, i think ios-10 is actually quite a big release. if you pull back, ios has not been a very permissive or
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opening operating system. they started to lay the groundwork for that in ios-8. ios-10 makes massive leaps. you have the maps product open to third-party developers, and siri. not as big as google and android, but i think it's moving in an open direction and it has a lot of benefits for the consumer as well. >> implications for confide, for example? >> yeah, well, we just launched confide for imessage, right, so now you can send and receive confide messages all within imessa imessage. encrypted, privacy protected, disappearing without leaving imessage. you don't have to set up an account, completely frictionless. and for a quedeveloper, to expo our product to thousands of new customers who are already engaged in a messaging application is incredibly powerful. >> easier than getting them to download the app. >> exactly. >> moving to the broader markets, major averages extending gains.
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dow is up 39, although it was higher a half hour ago. one of the theme at top of the minds of investors at delivering alpha was of course the return of volatility. listen to this. >> i think volatility as an asset class is unbelievably underinvested in. how many people sitting here really own volatility rather than worry about volatility? and usually you don't own it because it's expensive. it is inexpensive right now . >> i think there are tremendous risks. but i think anyone that's going to tell you it's going to go down tomorrow or next week, even next month or next year, it's sort of a guessing game. but you could look at the environment, and i think it's very dangerous. in other words, you're walking on a ledge, and you might make it to the end, but hey, you fall off that ledge, you're going to really see trouble. and i think that could well be. >> this morning on the "squawk on the street" with cramer, he said the script was to use the word dangerous, which he argued isn't necessarily what ordinary
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investors have in mind when you think about how specific the situation is to an icahn or a miller or dalio. >> you're talking about people who have a lot to lose, people who have been invested in stock and bond markets that are up a lot, depending on how you measure them. i do think it's the prudent-sounding thing, the idea of removal of central bank accommodation, whatever that's going to mean. it makes sense to point to that but it's hard for me to kind of look at that type of conversation and say we're going to get blindsided by these things that everyone's been watching for so long. and the idea of owning volatility as an asset class, by the way, the public's kind of on to that. if you look at these exchange-traded products that basically let you do that, they've been some of the most popular recently. of course, it's not a core holding of everybody, but it's out there. >> jon, your thoughts? >> i actually -- word for word, i agree with michael on that one. >> one of the other themes at delivering alpha was this end of central bank effectiveness and what happens if the efficacy of
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these central banks is already here, or it's already over. but mike, there are some central banks, bank of england, for instance, hasn't even begun its corporate bond-buying program. so they might not be effective anymore, but they still want to throw more easing at the problem. >> if it's the beginning of the end, then the end process could last a long time. i do think this is latest bit of anxiety in the markets in general and this lift in yields globally is this sort of dawning sense that maybe the central banks themselves don't have the appetite for further kind of experimenting or basically kind of doubling and tripling down on what they're already doing. that doesn't necessarily mean it's over, it's off to the races and the markets are on their own. i do think that, you know, you see the markets of today, the stock market of today, well, why? because yield's calmed down. for now, i think we're going to trade in that way. we're going to trade on the bond yield story just like we traded for oil tick for tick in the early part of the year. >> all this discussion about low-volatility etfs and the risk that brings overall, too much
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discussion? >> i don't think it's too -- no, i think in terms of the mechanics of it, i don't think too much discussion, but it's a very easy thing to grab on to. it's kind of to look for the malfunction in the machine as suppo opposed to saying this is the way the market metabolizes right now, but i don't think it's anything you can handicap or say it's a tremendous kind of spring-loaded problem that we have to be focused on all the time. >> a lot of things are going to be hard to handicap in the next eight weeks, that's for sure. mike santoli, jon brod, thanks. as always, good to see both of of you. check on the markets in terms of oil today. crude was down in the early trading and then went positive after the eia inventory about half an hour ago. now those gains are lost. it's gone down about 2% on quite a roller coaster on crude. that sudden reversal coincided with stocks coming off of their highs, although the averages are still the green. among sarah palin sectors, energy's gone from worst to
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first and back to worst again. talk about 99 problems, streaming service title posting big losses as pandora inks a major music deal. we'll talk with tim western again in an exclusive. then, from the city of bridges to driverless cars, uber launching a driverless program in pittsburgh. we'll speak with the mayor. and then apple with the rollout of the latest mobile operating system. we'll get details on that coming up. the launch window. we have to be very precise. if we're not ready when the planets are perfectly aligned, that's it. we need really tight temperature controls. engineering, aerodynamics- a split second too long could mean scrapping it all and starting over. propulsion, structural analysis- maple bourbon caramel. that's what we're working on right now. from design through production, siemens technology helps manufacturers meet critical deadlines. i think this'll be our biggest flavor yet. when you only have one shot, you need a whole lot of ingenuity.
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pandora announcing new music licensing agreements with sony and universal, still working on one with warner. the company's expected to unveil an ondemand streaming service to compete with the likes of spotify and apple music. joining us now on a cnbc exclusive is founder and ceo of pandora, tim westergren. tim, good morning. >> good morning. >> so, tim, break down for us exactly what the difference is between then and now, as far as how these new licensing agreements position you, especially when it comes to profitabili profitability and your projections for the next three to five years. >> so, it's a world of difference for us.
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pandora has historically been a lean-back radio experience. we've been tremendously successful there, 80 million people using the service, very engaged, 24 hours and more per month per listener. and what the deals we've struck essentially allow us to do is substantially expand that product to address every consumer need. if you want leanback, you have that, if you want to lean forward, be more engaged, have more interactivity, up to a completely on-demand service to give you all of the feature sets any consumer wants. so, we'll be able to address the entire demand curve for listeners and bring to bear on that, you know, a great product and an enormous existing audience, about which we know so much. >> you are literally up against the biggest and most powerful names in technology in apple, amazon and google, also trying to push in this music space. describe what gives you the confidence that you're going to be able to create this virtuous cycle, this funnel where perhaps people come into your free product and then are willing by percentages over time to expand their payment up into that $4 or
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$5 tier and then eventually that $10 tier, where apple music and some others reside? >> yeah, so, we're no stranger to competition. we've been here before, and we're very confident about our ability to execute. and if you think about what we bring to bear on this -- so, we have this core product right now at pandora. listeners are very engaged. they've been thumbing on pandora, giving us an enormous amount of precise information about their preferences. so, we have this huge foundation of listeners that are very engaged about which we know so much. and not just about their preferences, but also about their usage of the service. so, owhat are the pain ponts on pandora? and we'll solve those with the higher paying products, subscription services, and then we can provide options for them when they're hitting the pain points to upsell them. so, we're perfectly positioned and we also bring to bear the enormous personalization engine. when we talk of interactive, on-demand services, we're not talking about 30 million songs in a search box.
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we're talking about a completely personalized experience that's going to understand you, that will curate for you and be effortless and sort of as intuitive as the core radio product. and i think to win in this space, simplicity, ease of use, personalization are the keys, and i don't think anybody's got that right yet, and pandora will. the product we're seeing inhouse right now is very exciting. we can't wait to get it into the hands of consumers. >> one of the products your competitors are trying to get right is nonmusical content, podcasts, original content and the list goes on and on. what is pandora doing and what licensing deals do you have in the works for that? >> we've done some experimenting there, had some really good results, actually, from podcasts. we recently launched quest love supreme, hosted by questlove, had over a million station downloads already. this american life serial, we've had great success there. i wouldn't say that sort of content is hop priority for us. the first priority is, of
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course, pushing out these incremental subscription products, but we're well positioned if we want to add incremental content, talk, weather, sports news and the like. i think they'll see that on the service over time, but we'll focus on one thing at a time. >> tim, are you saying in effect that the reason we haven't seen more growth in pandora subscribers is because people want these services that are going to be offered now as paid, more specific control over what song they're going to listen to when? is that your contention? >> yeah, we've heard that loud and clear from our listeners. and if you look at our numbers, it kind of speaks volumes. we have a little shy of 80 million a month, about 100 million every three months on pandora. and really, what you're seeing there is for some portion of time, pandora listeners want to have more interactivity. you discover a new song on pandora, you want to rewind. you can't on pandora, so you go someplace else. that's the problem we're solving on this. we've seen this for a while so we began building a product and working on these deals. by the way, i will say these
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agreements with labels are true win-wins. we sat across the table to find a solution that works for both parties and i think pandora's uniquely positioned to do that because our incumbent business is very profitable, ad-supported business that gives us a great market, and our ability to kind of introduce what we think will be attractive, midtier products for the mass consumer that i think no one else can really do. i think it's a watershed moment. for listeners it will be, and for the industry as well. >> tim, maybe the most important question of all, are you pro headphone jack or anti headphone jack? >> like my headphone jack. i haven't tried it yet. i'm curious to try it. but look, you know, apple has led innovation. you know, i never underestimate them. they seem to make one right decision after another, and we've been the beneficiaries of a fantastic platform. the iphone smartphones have been a catalyst for us in many ways, so i'm rooting for them, for sure. >> we had keith meister, an
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investor in your company, on the air. we've asked you about the prospect of a sale. obviously, he's in favor of it and thinks the fact that you've hired centerview is a positive sign. what process is centerview running and what is the end of the year deadline you've previously given yourself? where is the progress there and how likely is the sale? >> we don't set any deadlines. as the ceo, my job is to look after long-term shareholder value. mine and the board. we're very focused on that. i think this milestone we've come across that we've just passed, signing direct deals with the labels, not only on terms that work for us and in a timely fashion, but that give us the flexibility to deliver all of the features that we had hoped for. i think sort of a real validation of the strategic choice that we made to expand the business, and we think that's really the key to opening up the biggest long-term opportunity for our shareholders. so we feel good about that. we talk to all investors, listen to everybody, and then we make what we think is the best decision in the long run, so i think we're on a good path. >> all right. well, tim westergren, founder, ceo of pandora.
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looking forward to seeing that new product and service out later this year. thanks for joining us. >> you bet. my pleasure. still to come on "squawk alley," uber launching its first self-driving pilot program in pittsburgh. how are users taking the news? the city's mayor, bill peduto, joins us next. and 4quarter co-founder dennis crowley on apple's latest operating system. all that coming up in a couple minutes. [chains dragging]
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if you hail an uber in pittsburgh today, it could arrive with no driver. uber is testing out its autonomous vehicle program, and joining us now is the mayor of pittsburgh, bill peduto. mayor, it's great to have you on cnbc. and it's an exciting technology. i'm wondering why you think that this technology is consumer-ready for pittsburgh right now? >> well, i think pittsburgh is the most logical place for it to be launched.
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it was back in the 1970s when carnegie mellon created the first robotics program in the world. and in the 1990s, back in i think '94, they actually had a minivan travel from pittsburgh to washington, d.c., and then back without the driver ever putting their hands on the wheel. and in 2007, they won the darpa challenge, the first time an autonomous vehicle traveled from los angeles to new york. so, we've been running autonomous vehicles in pittsburgh through carnegie mellon for years. over the course of the past year and a half, we've been partnering with uber, and now it's time to take it to the public. >> an uber engineer in a quote called pittsburgh the double black diamond of driving. is that a good thing or a bad thing? >> well, i guess it's if you like a little challenge, it's probably true. yeah, it's not just the topography. pittsburgh's a very hilly terrain. it has all four seasons.
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but you know, it's a city that was built in the 19th century, and it wasn't really designed for automobiles. so, as one of their engineers said to me, if we can prove we can do this in pittsburgh, we can prove we can do it anywhere. >> so, mayor, my understanding is that there is going to be a backup driver in each car and that these initial rides will be free, once people agree to actually try out these autonomous car routes. but how do you see this evolving over time? and what's really in it for pittsburgh? because one might argue, hey, there used to be a job actually driving people around now. that's a job that's being taken away. is it lack of congestion? is there an environmental benefit? when you look at this on paper, why is it good? >> check all the boxes. so, it's a great question. the first part of it is the timing of it. and if you talk to experts from around the world, they'll say anywhere from 10 years to 25 years, people will be able to purchase and utilize autonomous vehicles. and i think a lot of that is
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predicated on what the amount of red tape government will put in place, because the technology is already there. now, for pittsburgh, what it means is being at the forefront of a new industry again. and this is an industry that we helped to create in robotics. so, the jobs we're creating, over 600 so far with uber, their global innovations center, are jobs that are bringing people not only from around the world to pittsburgh, but two young graduates today were in the front seat of the car from carnegie mellon that were driving me, one who we brought back, one who we got to keep. i expect the numbers to be over 1,000 employees in the next few years. at the same time, uber's still going to be hiring human drivers throughout the world, and that number will continue to increase. there will be a pivot point at some point in the future when the job question will be more relevant than is it is today, but at that same tipoint,
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hopefully, we'll be able to show that the 1.3 million people who are killed every year around this world because of automobiles, that number can be reduced by hundreds of thousands. so, one other point of how this connec connects. the issue of urban mobility is moving at a very rapid rate towards autonomous, shared and electric, those three areas, and cars are being designed with sensors in them. so cars will be able to speak to cars. the public will invest in sensor detection on telephone poles, traffic signals. we already have the most forward-thinking traffic signals in the world today in pittsburgh. traffic signals that can actually learn. and they'll be communicating with the vehicles, much in the same way you use waze or google maps, you'll be able to communicate between all of the other vehicles to move traffic more efficiently and lower the carbon footprint. >> mr. mayor, isn't just the legal questions, the enforcement questions -- does a cop give a
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ticket to the engineer, to the driver in the back seat? i mean, isn't that going to be a huge drag on the innovation over the next five to ten years? >> there's really, if you look at what's happening around innovati innovation, it's hard to put regulation before innovation. if you do, you basically just guarantee that it's going to happen somewhere else. innovation doesn't stop. but innovation, if you allow pilot programs to occur, will create better regulation because you'll have a better understanding of what is needed. there will be cities around this world that we'll compete against. we're competing against gothamburg, sweden, singapore, san francisco, austin, texas. and if we were to say, let's wait and get regulations in place for something we don't understand yet, then what we'll be doing is just guaranteeing it will happen somewhere else. there are two drivers in every car, by the way. there's one person behind the
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wheel and then there's an engineer next to them who's monitoring the vehicle and the person driving the car. >> in pittsburgh -- >> behind the wheel. >> pittsburgh residents have been put on notice. it will be certainly interesting to see how this goes. mayor bill peduto, we appreciate your time this morning. >> thank you. >> pretty fascinating. when we come back, foursquare co-founder and cnbc disruptor dennis crowley, he'll weigh in on apple ios-10, the rollout and his take on the next watch. but first, it's the biggest deal of '16, bayer acquiring monsanto, a $66 billion deal. the ceos of both companies talked to us earlier today. we'll tell you what they said. >> we're really pleased with the deal. it took a long time. the board thoroughly evaluated the whole range of options, and this was the strongest option. it's an all-cash deal. it's a 44% premium. it's 18.5% multiple. so as we looked at the
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opportunity, it's a very strong deal for our shareholders. at
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good morning once again, everyone. i'm sue herera. here have s your "cnbc news upda update." north korea held a mass rally in pyongyang on tuesday to celebrate that country's fifth nuclear test. thousands of people gathered for the rally at the kim il-sung square. south korea says the north is ready to conduct an additional nuclear test at any time.
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sinna mark movie theaters has dropped its request that aurora theater shooting victims and their families pay them thousands of dollars in legal fees after the victims' unsuccessful lawsuit. james holmes opened fire inside that theater in july of 2012, killing 12 and injuring 70. u.p.s. says it expects to hire about 95,000 seasonal holiday employees, about the same as last year. the seasonal positions, though, have long been an entry point for permanent employees at the company, including current ceo david anny. and pope francis says that killing in the name of god is satanic and has called on all religions to join him in that declaration. the pope was speaking at the vatican during a special mass in honor of father jacques hamel who was killed by extremists in northern france earlier this year. that is the news update this hour. back downtown to "squawk alley." carl, i'll send it back to you. >> sue, thank you very much. let's get the european close at this hour. seema mody's back at hq as well.
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>> hey, carl. european stocks snapping a four-session losing streak but mixed overall when you look at overall picture, despite data showing eurozone industrial production down 1.1% in july. that includes a 1.9% output decline in germany. but interestingly enough, one of today's big winners is germany bayer, agreeing to acquire monsanto. the stock fractionally higher in today's trade. on the flip side, a pretty rough day for the european luxury good makers. hermez saying it's scrapping its forecast next year, citing an uncertain trading environment. and then cartier parent richemont, looking for weaker demand in hong kong. and jean-claude juncker says the
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european union faces the danger of an unprecedented rise of p populi populism. if was raised as a concern at delivera alpha yesterday, but he insisted they will stay intact. >> translator: we expect and regret the uk decision, but the european union as such is not at risk. >> also today, the european commission's competition commissioner margaret vestager made the case for slapping apple with a $14.5 billion tax penalty. >> the rulings, therefore, allowed apple sales international to pay very little tax on its profits. in fact, the effective tax rate of apple sales international was as little as 0.005% in 2014.
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it means apple paid less than 50 euros in tax for every million euro in profits. >> clearly a story that continues to keep on going. guys, for now, back to you. >> seema, thank you so much for that. apple rolling out its newest operating system, ios 10, bringing big changes for users and developers. our next guest's app is leveraging the new operating system releasing new features specifically meant for it. dennis crowley is executive chairman of foursquare, joining us from out west. always good to see you. >> great seeing you, too. thanks for having me on the show. >> we've been taking the poll about some developers about 10 and the degree of openness it allows. what's your verdict? >> yeah, i mean, the thing that's been fun for us is, you know, we do lots with notifications, pushing messages to people's phone' alerting them of great things that are happening nearby. so, for us to have the rich notifications and be able to use photos and other interactsive elements, that's a lot of fun for us. it's also been fun to see what
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you can do with messages and using stickers. our swarm app, people earn stickers and unlock stickers, so that's fun for our users too. >> can you give us an example through a foursquare lens and sort of put into perspective how 10 is different from 8 or any prior versions. >> yeah, it's all subtle tweaks, right? i mean, there's like a little bit of a visual refresh. everything gets a little bit faster. i think different developers find different value in different things. the thing we've been really excited about is the notifications and being able to use some of the messaging features with the swarm stickers and being able to put that in the messages app. you know, there's also some changes that came to the watch os that will make it more interesting for both of our products to exist on that platform, so that's also a lot of fun, too. >> dennis, traditionally and up to this point, android's been far ahead of apple on notifications and the way you're allowed to customize those, but apple has tended to have better
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engagement of the user base overall. do you see that balance shifting overall? and how do you see foursquare users platformwise shaking out? >> yeah, actually, i don't know what the split is these days between ios and android. it's different around the world. it's different in different countries. what you're saying is right, like sometimes you see stuff come out on android first, sometimes on ios first. you know, both apps are pretty much in parody now. i think a lot of the catching up has been done. it's fun to see, like, where the hardware goes and what some of the more interesting stuff that comes out is. we're always looking at how can we push the boundaries of what we're doing with interesting geofencing, and a lot of that stuff we haven't been able to get from ios or android. we have to build a lot of that on our own, which is why you see foursquare doing things with notifications that a lot of other apps aren't doing because we've had to build this technology. it still doesn't come for free with os. >> you mentioned the watch just a moment ago. we're on the third watch operating system now. >> sure. >> how much of a priority is
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that for developers, or does it take a back seat to developing for the phone or for other technologies? >> i still think it takes a back seat just because, you know, it's limited interaction. you're not seeing everyone with them. everyone has got a smartphone. everyone's using these devices, so it's much easier to build a giant audience i think on a phone than opposed to the watch. it's still a lot of fun to build things for the watch, because like, you know, you get a glimpse of the future. we look at what apple's doing with the earbuds, right? like, will we be able to build a version of foursquare that whispers things to you, you know, if people are actually going to wear those things around? so, we'll do experiments there and see where that goes six months from now. maybe that's something we end up launching. but every time there's new hardware and software to go along with it, it's fun for us internally because we get a little bit closer to being able to build this version of the future that we've been so excited about at foursquare. >> the headphone jack has been beaten to death for the better part of a few weeks, dennis, but i wonder whether or not you take it as a comment about apple
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truly being forward thinking, or was it a more practical solution to real estate within the device? i mean, how much of a comment is it about their ability to control the pace of innovation over the next few years? >> yeah, it's -- you know, it's funny, because i was around when they got rid of the floppy disc and when they got rid of the modem jack and the ethernet jack, and there was a similar uproar every time. you know, i think this stings more than most, just because, you know, hey, i still use headphones. i don't have wireless headphones yet, so that's like a version of the future that people have to adapt to. but i get what they're doing. they're trying to, you know, push the devices forward. and i think as much as it's about making room in the phone, it's also like, hey, let's have this world where, like, you have other audio cues, apps that talk to you. there's a different way to interact besides just looking at the screen all the time. i think this gets them baby steps closer to being able to do some of that stuff. >> yeah.
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i guess we'll see if apple is ahead of the curve here and able to push people toward this wireless future or if people are going to push back. you've been watching the space for a while. do you think a guess? is this like what they've done in the past, getting away, doing away with drives and people followed, or might this be different? >> i think people eventually end up adapting, right? and you know, in order for things to get pushed forward, someone has to lead people. and sometimes, you know, people aren't always bought into it initially, but it catches up over time. you know, i think all the best technology companies have to do this. i was just watching the segment you were doing on uber pushing self-driving cars, and it's fascinating to watch. you know, like, we have our own technology agenda at foursquare, like we try to invent stuff that's a little bit crazy. it's our version of the future. you push it out, see if people like it, and if they do, you double down on it. all of the technology companies are doing this all on their own, like certain unique ways, and it's fun to be a part of it. >> dennis, always good to get your point of view, for sure, and we look forward to playing
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around with foursquare yet again. we'll talk to you soon. >> great. great seeing you guys. >> dennis crowley out at one market. when we come back, a giant step forward in the marriage of health care and technology. how alive corps is trying to become a major player for heart health. the ceo's going to join us next. first, rick santelli, what are you watching today? >> i'm watching all these really cool phrases that many in the markets are coming up with -- generational lows when it comes to treasury rates. hey, i think it was a generational low at $26 for oil, but does that really matter? maybe what matters more is the range it's currently trading at, and that's what we're going to be talking about after the break. the lights go out. people get anxious and my office gets flooded with calls. so many things can go wrong. it's my worst nightmare. every second that power is out, my city's at risk. siemens digital grid manages and reroutes power, so service can be restored within seconds.
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today on "the halftime report," the man with one of wall street's most bearish calls. jpmorgan's u.s. equities strategist is with us and is calling out one sector in particular he thinks will drop hard, but he sees opportunities as well. apple bulls back in business. the stock up more than 8% since just monday. is there more room to run or did you miss it? and much more from carl icahn from delivering alpha. he has a lot to say, top of the hour on "the halftime report." carl, see you in about 15. >> that was good stuff yesterday, scott walker. thank you. now to the cme group, rick santelli, "the santelli exchange." hi, rick. >> hi, carl. there are a lot of cool things being written about the treasury markets, and indeed, there should be.
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i'm not sure if we're making a generational low. it seems like a safe bet, but do remember, you know, if you look at 2012, a whisker under 140, look at the recent low this year around $136, there's not a big path in between those two. so, arguably, you could argue that we've made a generational low a couple of years ago, but is it really important? it sounds great. i think it makes people look smart, and indeed, maybe you have to be smart to draw those types of conclusions, but that's not in my opinion what's the most important thing. and i think there's a good example. let's look to the oil market, okay? there was a close to $150 trade, and then there was a $26 trade. does any of that put money in your pocket? because the current range seems to be $40 to $50, and it seems to be pretty comfortable in that range. that's the money range. that's what you need to know, how many times you can buy it against the low or sell it against the high range. now, what makes that range important? well, regard to energy, what changed the dynamics in large part was fracking. it changed the scaling, so to
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speak, it changes the costs and all of the variables, it changed all the inputs, so you're changing all the outputs. we could make a similar analogy to treasury yields, because the fracking to treasury yields is central banking policy. large portfolios of securities on the balance sheet of the federal reserve or different banks with regard to the eurozone or an aggregate to ecb. that makes a huge difference. so, to me, what happens on a historic front when we look back ten years from now isn't necessarily what traders should be paying attention to. they should be paying attention most to ranges. and this year we've had a pretty tight range that we just broke out of. it was basically for a ten-year in the $150s. let's make this real simple, shall we? this is a chart starting in 2015 for treasury yields. here we are roughly today, okay? and this is the end of the year, beginning of this year. for the most part, this year is a mirror image of last year.
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let's make it even more simple, okay? 2015, you had a high yield on a closing basis to 248, this year 136. the average of those is around 192. i don't know what the rest of the year holds, but i think it's a pretty safe bet, whether you call this the generational low or not, what you have is this area to make money, and this area to make money, most likely, is going to be in a range somewhere above 160 and somewhere right below 2%. that's probably where we're going to be. that's the money trade. jon fortt, back to you. >> all right. thank you, rick. it is an education. we appreciate it. and when we come back, the maker of a device that delivers an ek sgg on your smartphone partnering up to give you deeper insight into your blood pressure, too. the details on alive core coming up next. ♪ i'm still alive like coffee. but there's one thing you do. you guys okay?! it's called predix from ge.
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our next guest makes a heart monitoring device that connects to your smartphone and recently releetsd an ios app that allows them to monitor their heart rate and blood pressure together on the same screen. the former head of social at google joins us now. good morning, vick. >> hi, john.
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good morning. i have an on-line blood pressure monitor. i'm getting close to 40, and i worry about those things. it's interesting to me that you want to combine what you can do with just that with the ekg that you are delivering with cardio. tell me, what's the thinking behind giving people that information in one place? >> it's responsible for more deaths than all forms of cancer combined. we're allowing you to check the kind of heart issues that's very serious. when we talk to physicians, the second thing they wanted to know was if the patient was hyper tensive or they had high blood pressure. it was very natural for us to bring these things together. really for the first time you can monitor your ekg, things like atrial fibrillation and
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combine that with blood pressure and really bring those two measures of physiology together and then share that with your doctor. it's pretty exciting. we're the first ios app to be able to do that. >> vick, a lot of people who follow tech will remember you from heading social at google, google plus, google photos. a lot of the sharing and cloud initiatives that customers got to interact with. what led you from there to here, because some might not get the connection. >> well, you know, the reality is i have a deep passion for technology, software and machine learning. that and the fact that my father had two heart attacks really drew me into this space. the ability to use technology to be able to diagnose and potentially prevent someone else from having a heart attack or to be able to get help quickly was something that i couldn't resist doing, and in a live core we're building technology that might be able to save, you know,
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someone you love, your parent, someone's life by being able to detect an arrhythmia early. the device is less than $100, and what it can do is just amazing when paired with your smartphone. i just felt it was an opportunity i couldn't miss -- i couldn't afford to pass up, and i have really been having a great time. >> it is a noble cause, but it's certainly a very serious one as well, vick, and one of the images on the website of the alert on the watchband says this result is not a diagnosis. only a possible finding. is there a risk that you unnecessarily spook people about something? what's the margin of error on something like this? >> well, we are about 98% to 99% sensitive and specific when we give you a diagnosis. particularly when we say that you have got possible atrial fibrillation, we want the patient to seek medical help. it can be a life-threatening condition. we're very, very careful, and
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most importantly we've actually done the clinical trials and we're fda cleared, and i think that's a pretty important distinction. our product is in the fitness product. it's a product that's clinical grade and been cleared by the fda. we stand by our product and are excited about the impact that it's having on people's lives every day. >> vick, that brings up an interesting issue for me. when you look at android wear and what apple is doing with the apple watch, i have trouble with both when it comes to heart monitoring. i don't know if it's a skin pigmentation issue or what, but it's just not accurate with me. how are you different, and what age -- at what age do you think people ought to be using products like yours? are they mainly for older people, or do you envision a day when everybody is checking their ekg on a daily basis? >> so, john, that's a great question. you know, consumers sometimes
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get confused between what is a heart rate, which things like the apple watch or android wear can do, versus what is the ekg? most consumers have never seen their own ekg. in fact, we're the first product cleared by the fda, and electrocardio gram is dramatically more accurate than the watches provide you with just simple heart rate. we strongly encourage you to go get an ekg, not just a heart rate. in terms of what age? you know, i'm in my 40s, john, and i really care about my heart. especially given my family history. we encourage anyone who is concerned about their heart, given that it's the number one killer of men and women, in fact, in this country more women have died of heart disease since 1982 than men. five times as many as breast cancer. we think if you are -- if you are concerned about your health at any age, particularly if you have any palpatations or irregular heart beat, this is a tiny investment to make to purchase an alive core, have it in your purse or wallet and keep track of your heart.
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>> well, vick, very interesting power that this mobile and technology revolution has shifted in the hands of consumers. well see how people end up using it. thanks for joining us on "squawk alley." >> thank you. when we come back, big news for "star wars" fans. >> chewy, we're home. >> chills every time. disney inking a multimillion-dollar deal to bring the franchise to cable. the details after a break. ♪ [engine revs] ♪
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we're drowning in information. where, in all of this, is the stuff that matters? the stakes are so high, your finances, your future. how do you solve this? you don't. you partner with a firm that advises governments and the fortune 500, and, can deliver insight person to person, on what matters to you. morgan stanley. what's that? the number of units we'll make next month to maximize earnings. that's a projection. no, it's a fact. based on hundreds of proprietary and open data sets folded into a real-time,
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actionable analytics model. nine. eight. three. five. two. you're not gonna round that up? you don't round up facts. powerful analytics driving decisions for the world's most valuable brands. hewlett packard enterprise. there's an awakening coming to cable. turner striking a deal with disney for basic cable rights to ten "star wars" movies including the farce awakens and the upcoming spinoff rogue one. turner agreeing to a deal with fox for the original "star wars" film. numbers on that deal not confirmed. estimated to be worth at least $250 million. runs through 2022. remember, disney bought lucas
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film for $4 billion in 2012. a deal that got laughed at at the same time. not so much anymore. >> at the time the franchise seemed to be pretty much dead, and killed in a way by its own creator. a lot of people didn't think it was possible to revive. >> let's get over to headquarters. wapner and "the half." i'm scott wapner. delivering warnings. why so many big investors say there is danger lurking in these markets and how to protect your money as volatility returns. with us for the hour today steven weiss, jim, john and pete. also with us on set today, dubrasko lakos. stocks steady this hour. trying to come back. there's the dow up 64 points.


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