Transcripts For CNBC Squawk Alley 20151231

On wall street. Squawk alley is live. Good morning, and welcome to squawk alley on this new years eve. Im kayla. With me simon hobbs. Good morning. Joining us from one market in San Francisco, founder and editor in chief at the information, also a cnbc contributor, jessica lessin. Good friday to you. Or good thursday to you, rather. Its not quite new years yet, but soon. Its a short week, so its easy to get a little bit confused. First, jessica, microsoft says it will now inform customers if Government Agencies are trying to hack into their accounts. It comes after a reuters report that the company chose not to tell thousands of hot mail users that their accounts were hacked by the chinese government. Reports say microsoft found evidence of these attacks back in 2011, but, rather than informing users, it simply asked them to change their password. It was reuters that reported this originally and reached out to the company for comment. Is there precedent for Something Like this . How do Tech Companies normally approach this . One of the first times this happened with a company identifying a statesponsored actor was google back in china several years ago which actually precipitated them pulling out of this market. 6. Obviously i think signals and political posturing as well. These are always tricky topics. I think its very Interesting Companies are going to blame other governments more, and i think it probably reveals there are some tennings behind the scenes in terms of negotiation. Weve already got this those within social media are not beholden to Big Government contracts in the same way as a microsoft or which will be absolutely, simon. I think theres a different set of issues and less about the contracts and more about filtering or blocking or sensorship or some of these other issues. I think thats probably only part of the calculus. I do think signalling to customers whats going on is very top of mind as well. People are antsy about their privacy and security and no Company Wants to look like they fall for that. The incident that reuters first said happened in 2011, and at that time privacy and security will still be utmost of importance. It really wasnt in the public conversation the way it is now. Im wonder if anything you think theres a statute of limitations they wont necessarily feel the need to address it. Is that fair . Definitely, and so i think we can assume ions in tech time, so i would suspect theres more to the story. Microsoft also up 20 for the year, jessica. Nodella has been able to notch gains year after year. What do you see for the companys turnaround continuing into 2016 because were expecting them to make a big play into Virtual Reality with hollow lens and even a bigger push into the enterprise. What does that look like . I think its too soon to say. I mean, the hollow lens looks awesome. Fun demo. Im not sure if that is a great Consumer Product yet, so that is a big question hanging over the company. I think the mobile strategy will also be interesting. Nadella moved just from microsofts old suite of products to getting more of those Microsoft Apps on the iphone, caring more about the overall user base than lockin. I think thats a really interesting trend. I think theyve done a great job on that. Whether it needs to growth and helping the bottom line i think. Theyve been criticize it for major performance issues, and that might be because twitter didnt actually build it. According to the Verge Development of the app was its not a big deal in and of itself, but it does highlight potentially some continued struggles at the company. The stock is down about 38 in 2015. Jessica, we first learned about the app being out sourced by an employee tweet that was very harshly worded, so there was a long and sorded tale behind this. What do you gleen from the fact that they chose not to build this in house . I say good for triter. Focus. This company has bigger problems than, you know, one app for the mac. Not that the app isnt important, but it had weaker than expected guidance. Its got an anemic user growth. Jack dorsey wants to focus on the company, and i think thats a good thing. These days the Development Process is changing. I think lots of Companies Use contractors. I think this tweet was blown out of proportion, if will you. Jessica, theres also obviously an issue about the new head of diversity twitter and whether he is going to be able to redress2 of the work force actually africanamerican. Where to you think dorsey will be this year coming . Do you think he will have turned around twitter . I didnt realize its more than two years now since the ipo. This has been on the market for a long time and clearly trading below the 26 which it was priced. I think its an uphill battle. I think jack has done a nice job in rallying some of the team internally. A lot of people that we talked to there at the company the execution is tough. I mean, luckily the monotization seems to be working well, and Revenue Growth is good. That doesnt seem to be appeasing investors. 2016 and it needs a different owner and a different distribution. Its one of the big wez. I mean, my belief is its just not a massive one. You know, i think the expectations are a bit out of whack. I think theres a question of is there a sort of smaller more streamlined profitable but not hugely valuable twitter . Then what would it be worth to someone else . You know, i think the ship has sailed for Companies Like google and facebook being interested. It may be at a far lower price, but not now. I think the path for twitter is to be a great twitter. It still has a 15 billion market cap. At the rate in which you could reinvent technology or streamline your own into an existing platform, i mean, would anybody pay 15 billion for twitter . Right now i dont think so, but actually, you know, anybody is a broad word. There could be lots of fires beyond the ones we sort of are thinking about. Maybe in the mobile space and the telecom space, but i think its clear. Sometimes our expectations for it are just out of whack. This is a company that has 300 million plus monthly users and, you know, meaningful revenue. I think some of its getting the expectations back, but thats hard to do when you are in the public spotlight, and dorsey is going to continue to learn that lesson. Certainly we in the media get a lot of value from it, but well continue to see whether it can gain that mainstream traction. Finally, jessica, as we look at the year that was, think about some of the big tech headlines. The apple watch, mobile payments, the space race that really came to a head in december. What do you think some of the top stories were and will continue to be in the new year . With information were really focused on some of the late stage private financings, and i think that was a big story. Not just are valuations out of whack, but looking at the deal and how they came together and the markdown that is mutual funds have made on Companies Like snap chat, zenefits, drop box. I think its something worth following very closely. Were also very excited about new areas like hardware space is heating up again. I think we made our up and comer of 2016, frank wong, the founder of dji. I think weve been hearing a lot about drones and think of them as nice little gizmos, but i think next year is the year when were going to see more of them in the enterprise or see go pro battle dji headtohead. Were very excited about dji. Thats the ipo market, of course. I think snapchat is maybe closer to an ipo than some people realize. I dont think its any time imminent. Obviously, the company has some ways to go on the wisconsin fro Business Front still. Thats another thing were watching for in particular. How quickly can they get their business growing so that they can be public. We start the year in vegas at the Consumer Electronics show which has a lot of news. I know you and the information will be keeping busy. Loved having you, and we want you to have the happiest new year. Happy new year, kayla. I dont want to depress you, but lets have a look at where we are at the markets. Positive for the s p for the year. Up just over four points. Weve now lost that, which means that the s p, the broad market is negative. Dow jones is negative. The nasdaq is the only major index thats up for the year so far. Up 6 . Lets have a look at the nasdaqs leaders, the nasdaq 100 leaders. There you can take victory laps clearly, and the nasdaq losers are like an awards ceremony. It is. Micron fairing the worst. Big china exposure. Chipmakers have not faired well. Coming up, despite lower volume, it actually was a big year for ipos. Big names like shake shack, square, fitbit all going public. Well take a look at the year in ipos and what to expect going forward. Plus, netflix was the top gainer in 2015, but amazon and hulu continue to make strides in streaming video. Well look at some of the new offerings from all three in the new year. And shocking comments about star wars from creator george lucas. What he said and why its causing such an uproar. Squawk alley will be right back. Its hard to find time to keep up on my shows. Thats why i switched from uverse to xfinity. Now i can download my dvr recordings and take them anywhere. Ready or not, here i come whispers now hideandseek time can also be catchuponmyshows time. Here i come cant find you anywhere dont settle for uverse. X1 from xfinity will change the way you experience tv. 2015 say big year for ipos. Bob pasani has a look back. There have been a lot of winners and losers. There have been an unusual amount of losers, and well focus on 2016. Fit bit had a great close to the year. I put shack page in there as well. That was up about 90 . Big name winners. There were a lot of particular segmented losers that were out there this year. Univision. Neiman marcus was floating out there. Never happened. Well see if that happens in 2016. The big trend is 2016. I think its going to be tech stocks. We did already get some filgsz. Business storage companies. This was a big cnbc disruptor in 2015. If they make it to the finish line, they would be the third. Pure storage is on the list as well. Secure works. Thats a dell subsidiary. They also filed about two weeks ago. We mentioned equity stage bats. Thats already filed. Nutanics and secure works could go public in the first two weeks of 2016. They may be the first alumni of the new year. Others that have not filed, but are floating out there. Adaira and student loan refinancer, social finance, also a potential ipo. If the conditions are right, you know, if the markets lift in the first half of the were, a lot of those unicorns are waiting out there, and this is going to depend on the market conditions. Drop box, snapchat, and uber and air bnb and pinterest, spotify out there, and a lot depends on things like your burn rate. Drop box, for example, burning through cash very fast. There may be certain pressure to go public. Others may not have that particular problem. Its going to be a very interesting year, and tech is going to be the ipo sector to watch. Guys, back to you. Lets bring in david menlo, president of ipo financial. Com. I would like to be around danny myers dinner table. I would like to hear how he sees the world after the shake shack ipo, which really was the star. It clearly was the star. It opened up 123 from its ipo price, and it is the best performers as far as the ipo openings. I dont want to say anything poor about the stock, but if you take that universe of, i guess, food stocks and shake shack at the top, theres no way to look at anything else other than purity of what that deal was about, the strength from, virtually every compass pointed. I would not say that is going to typify what were going to see. Because of the performance of shake shake in particular, the investors, the insiders were able to cash out so much of their holdings in this company. They continually came back to market. Many of private equity sponsored ipos that are coming into the marketplace, are doing that very thing, and everybody seems to look past it. Its almost like, i guess, Donald Trumps hair. Everybody sees it for the first time and its, like, what is that, and then after a while they get used to it, and they just figure thats the way things are going to be. Theres no question about it. Thats the best conclusion that you could bring to this particular topic. Weve got basically three different sets of investing that are going on. You have the insiders and the people that are getting these ipo price shares. They are having a ball with that at the opening when they get into the right ones. I guess 123 on shack shack and many others. Thats great. Then you get the Retail Investors that got shut out, and theyre buying the dregs from way at the top. You see a stock like etsy. It drops, and then everybody waits for the institutions to say, well, its a good value here. Down 60 . So it is a very mixed bag. Bomb also mentioned the leftovers. Albertsons, neiman marcus, soul cycle. They filed for an ipo and werent able to to it. Whether it was concerns of laboring concerns by the sec or a stubbornness of the price the market was willing to pay. Does 2016 pave a way or do they get sold . The last example is what this is about. You have insider that is are saying fair market value via accounting standards is x number of dollars, and that is what were going to do. When a market is very clearly saying, as we saw with square, extent matter what the funding rounds are bringing in. Its what the Public Market is going to dictate. They are saying lower. And its an balancings. Insiders, management team, investors saying not on my watch. That certainly leads to us a discussion or comment as were out of time on uber, which i think recently raised funtsdz that valued it at 64 billion. The highest valuation in the private markets. Looking to raise 12 billion in debt. Can they come to market . They can, and i would say the only parallel you can make with that company with any other situation, its not the 800 pound gorilla, the 800 ton gorl wra, it is the Aircraft Carrier in the bathtub. It is going to push people to do stupid things, and one of those is going to be valuations. I dont know that all the analysts are going to have sufficient enough information to really come up with something that is do we have a six to nine, 12 month good investment here, or are we going to see the pop and then the drop . Just to cut to the chase, are you suggesting they can risk coming to market and kicking the tires on that 64 billion valuation . Management could do that at uber or no way it could do that . They can do it. The problem is at what value . I dont believe its going to be at the other ball or whatever their last funding round is. It is going to be lower, and its going to be a small percentage just so they get their foot in the door. Well leave it there. Have a great new year. Always good to talk to you. David menlo from ipo financial. Up next, much of europe on alert ahead of the new Year Celebrations there over the next few hours. Well look at the preparations. Plus, shocking remarks from george lucas on the new Star Wars Franchise that he sold for 1 billion. When we come back. Zirchlg the war of words between t mobile and youtube heating up. Julia borstein live in los angeles with that story. Julia. Kayla, youtube and t mobile are facing off over the way that t mobile is handling youtube traffic. A wlikt which raises some questions about the secs mandate for net neutrality, which means treating all internet traffic equally. Now, heres the thing. T mobile has a new service for binge on for all of its customers paying for at least three gigs of data. It does count youtube, which is not participating. The company caps the walt of all video streams, both those participating and those that dont. Last week youtube accused t mobile of throttling its video stream without user consent, telling the wall street journal that reducing data charges can be good for users, but it doesnt justify throttling all video services, especially without explicit user consent. T mobile ceo john ledger responding to youtube criticism in a tweet saying, our customers heart bingeon streaming video who hitting their data bucket and complete turning it on and off at will. The word throttling, they say, is misleading, and that youtube videos are mobile optimized or downgraded, which doesnt sound quite as bad. The fcc explicitly banned throttling of content. Well have to see if google decides to file a complaint. Google would prefer this would be opt in rather than opt out. Back over to you. Okay. Thank you very much. In the meantime, wrurp is on high alert ahead of its new years celebrations. Russell brussels cancelling fireworks and other festivities as six people are arrested there in connection with an alleged terrorist floth plot. Nbcs chapman bell is live in london with more details. Over to you, chapman. Simon, well, as the clock ticks closer to midnight here, its a high security along the river thames where the fireworks will be this evening. Police are arriving by the busload. We are seeing sniffer dogs checking everything. Its very mythed methodical search here. Police even taking the covers off of lamp posts and checking inside of those, and police going through the trash cans as well. High security here as the threat of terror is high on everyones mind. As you said in brussels, the fireworks have been canceled. Six people detained there related to a possible terror plot on new years eve in the belgium capital. This is in addition to two other people arrested earlier in the week related to this as well. Also, no fireworks this evening in paris. A very muted new years eve celebration there. Heavy police presence. 11,000 police, military, and other personnel keeping the area in paris where the festivities will be under close surveillance, so high security all around as People Get Ready to ring in the new year here in europe. Simon. Hope its a safe one. Thank you very much. The london celebrations, or preparations there. Normally at this time we bring you the European Market close, but markets on the continent for today began their new years Holiday Hours ago. London, paris, and madrid all falling in their respective abelievated sections. Germany and italy were actually closed today. For the year italy, germany, and france among the big gainers because of qe and the fist half of the were. Europe stock 600 index has outperformed the s p 500 in this year up 7. 5 posting its fourth Straight Year of gains. The important thing there is to see the lift in the first kwurt of the year. Swrir still out. George lucas making headlines to disney. Heres what lucas told charlie rose. I love them. I created them. I am very intimately involved in them, and, obviously and you sold them . I sold them to the white slavers to take these things and look whereas didnt complete that thought, but he did say he would have taken a different approach to the new star wars film. They wanted to do a retro movie. I dont like that. I like every movie i work very hard to make them different, make them completely different with different planets, with different spaceships, with different make it new. Simon, he did say that when he was discussing the sale, he had already brought on a couple of writers to start plotting out what the sequel would look like, so perhaps he already had in his mind what he wanted the movies plot to be, but, of course, when you decide to change control, pass go, and collect a few billion dollars, you see that effectively. I guess he is concerned that the name the brand is going to be stuck as some sort of retro forever and its not going to move on, but thats the price you pay when you sell out your children. The quote there is he is talking about his children, and charlie rose says you sold them. Yes, he sold his children for 4 billion. I would just say star wars fans dont really love the prequells, which were some of the more recent you mean the flops that he made. Yes. Ill let you say that. All right. When we come back, a strong year for netflix and amazon. Both stocks up more than 100 in 2015. Well tell you what to expect from both companies in the new year in just a moment. Dont go away. Squawk alley will be right back. Im here at the Td Ameritrade trader offices. Ahh. Steve, other than making me move stuff, what are you working on . Let me show you. Okay. Our thinkorswim Trading Platform aggregates all the options data you need in one place that lets you visualize that information for any options series. Okay, cool. Hang on a second. You can even see the anticipated range of a stock expecting earnings. Impressive. Whats up, tim . For all the confidence you need. Td ameritrade. You got this. Good morning. Im sue herrera. Heres your cnbc news update this hour. Bill cosbys attorney is accusing the prosecutor who brought charges against the comedian of playing political football. In an interview this morning on the today show, Monique Presley defended her client and said there would be no plea deal. My client is not guilty and there will be no consideration on our part of any sort of arrangement. Cosby has been charged with aggravated indecent assault. Get used to this crazy weather because nasa says el nino will only get worse. The new satellite image shows the current weather system on the left. It looks a lot like the worst el nino on record which is on the right. Almost identical, actually. The mother of the socalled affluenza teen back in the u. S. She arriveed in los angeles overnight. Meanwhile, her son, ethan, is still in mexico awaiting a deportation hearing. And 2015 was a cheap year for gas. Tripleas yearend gas report says that drivers paid an average of 2. 40 per gallon. That is the second cheapest price in ten years. That is the cnbc news update this hour. Back to squawk alley, guys. Have a great new year if i dont see you. You too, sue. Pleasure working with you. Sue herrera there. In the meantime, the streaming wars expected to intensify in the new year. Netflix alone expected to shell out 5 billion on original and content in 2016. Amazon now aiming to create 16 original feature films a year and, get this, all three Major Streaming Services amazon, hulu and netflix garnering an unprecedented 14 globe nominations. A latest sign of how online tv is changing the tv business, and of course, jeff bezos saying he would like an oscar. Joining us now at post nine is jason lynch, tv writer for ad week. Good morning. Good morning. Where we go any further, as a matter of public service, you were telling us in the break on netflix there is something you can stream that you can count down a fictitiousal new year with the kids. You can go on to netflix today and fool the kids into thinking the new year has happened whatever time you want. You can stream a new years countdown just like you would any other are they actually fooled . Depends on your kids. Some will catch on, and some will just be happy to celebrate at any time. You can celebrate before mommy and daddy go out. What is 2016 going to hold in general for streaming, do you think . Netflix is still far and away the big streamer, but both amazon and hulu made major strides in its last year with new original content to really position themselves as viable on thetives, interesting content on both of the services, and were going to see even more of that as we go into 2016 with all three services expanding the amount of original content they have. Sfroo are you able to gauge who is winning . Amazon put out a press release in general and said the man in the high tower, which is the nazi film the man man in the high castle. Forgive me. It was the biggest debut theyve had. Thats meaningless because we have no figures. Theyre all guilty of this. You they wont release ratings. All we know is the subscribers and netflix has 43 million southwest, 69 million worldwide. We dont really know how the man in the high castle is doing relative to a house of cards. We really just have to go on buzz. Four and a half times zero is still zero, right . Right. A lot of the networks and the premium content Companies Know that they have to figure out a way to go direct to consumer. Weve seen them tiptoe into that arena. What does that look like this year . Do we see a skinny bundle . Its interesting. Especially tazz relates to netflix. They give their content to netflix, and also now, theyre kind of encouraging people to come. Now they have to decide, well, do we hold on to that content and kind of encourage people to not cut the cord, or do we still sell to netflix and make money and direct content there . Do you have an appreciation of affordability in a creative sense . With everybody trying to buy every script they can, are they getting value for money . Right now they say they are, but at the same time netflix is going to spend it could be as much as 6 billion on original content this year. Theyre pretending everything is successful, and its really not. Its hard to know how that is a staple going forward. Netflix brags about being cash flow negative. They think its a badge of honor. You see the last Earnings Report that the subscriber broke has started to theres finally maybe these huge gains. Theyre going to finally, you know, its going to be plateauing next year, and everybody else will try to make their play to stay in the game and also make a gain. When jeff bezos says he would like to win an oscar, is he going to achieve in a . Are they in the right ballpark for that . Do they create at the right level . This is the fist year in the movie game. They were already winning emmys. Oscar will be a tougher role for them. Because of the act my and whether the academy will give it to them . Zi think in tv its a little ease wrer to break into the club as theyve done. If the quality is good enough on tv, are you in the club. Movies, its a little bit harder, i think. Most of the Academy Members will look at amazon and netflix at arms length. Were on the tv side and theyve been welcomeed in a bit. See you, jason. Jason lynch there. Up next, a rough day for the markets. A make or break session for the s p on this new years eve. Currently slipping to the down side of half of 1 brsh first, Rick Santelli, what are you watching today . Well, of course, im trying to think about what type of economic horsepower were going to have for 2016. Not just domestically but globally. After the break, were going to be talking about horses and saddle bags. All coming up. Looking for 24 7 digestive support . Try align for a nonstop, sweettreatgoodness holdontoyourtiara, kindofday. Live 24 7 with 24 7 digestive support. Try align, the undisputed 1 ge recommended probiotic. Coming up on the halftime report. 2016 here we come as we close out the trading were. This gives you their number one trading whered for next year. Plus, in 2014 he said oil would hit 35 this year. Almost exactly where it stands today. What does he see ahead in 2016 . Tom clover will be joining us. Our old friend Herb Greenberg told you the best and worst ceos of the were. Is he back with us for a look at who will have a challenging 2016. Those things and more, simon. Back over to you. Thank you very much, mandy. Were still down 98 points on the dow. Negative of the s p for the year. Lets get the market flash from seema. Were keeping an eye on apple in the last trading day of the year. Its on track to turn in a negative year since 2008 when am lost 56. 9 . Apple currently down 4. 1 this year trading over 20 below its 2015 alltime intraday high. Whats behind the selloff . Analysts pointing to concerns over its iphone pipeline and Earnings Growth in todays trade by 1. 2 . Simon. Thank you very much. Lets send it over to Rick Santelli at the cme for the santelli exchange. Thanks, simon. Final one of the year. I hope viewers and listeners enswroi these spots as much as i enjoy doing them and being the last session of the year. I think we are going to call this horses and saddle bags, and theres a lot of economic horsepower, and i think when we look at economic horsepower, the united states, obviously, swrumps right out in front of the pack. Now, there are issues, the dollar, multinationals. We had alsandra discussing chicago pmi today, the weakest since july of 2009. One of the special questions was regarding what the outlook for 2016 is. I also found the transportation costs moving up. A lot of merger and acquisition, a lot of consolidation because with few prices being so low, i think amazon, think manufacturers in general, that these things are going to get passed along. Part of that is the dollar, but forgetting the dollar for a minute, diversified economy, and i think thats a big plus. Now, its not to say there arent issues, but i think the bigger issues are lets take a look at japan. I know that cnbc has been pointing out there are close to 9 in dollar terms in year. It wasnt a lot of movement, actually, this year between the dollar versus yen relationship, but all things being considered, the japanese are moving in so much qe, and much different than the u. S. For example, i know that the s p, the futures contract, down here from the equity index, is one of the big players. Bank of japan. I think that a saddle bag in the instance outweighs some of the horsepower, so they have the best of the nikkei since 1995. Well, whats your number . 1989. Here we are a whisper below 20,000. They close a whisper below 40,000. Now, i understand theres been improvement, but its easy to get stocks up if are you buying things that directly push stocks up. We know qe translates into a form of equity horsepower, but they have gone beyond, and i think that saddle bag works against them. In terms of europe, well, i think in europe its easy to handicap whats going on. Look at some of the Interest Rates of the weaker economies. Way too close to bund yields. Competitive, if not lower than u. S. Yields. There has to be some type of balance and an over tying market force wills work their magic. If march yoer draghi tries to prohibit that, thats going to be extra saddle bags. If we wanted to summarize, the saddle bags of death will lows in, and ultimately you can only use test tube so far. You know, if we talk about cleanest shirt in the hamper, all those analogies, and i have my criticisms of the u. S. , but normalization by the fed is a great thing, and the fact that were normalizing will inhibit some of the broken bubbles, things to watch out for in 2016 in hi opinion. Watch out for the gses, government sponsored enterprises. They continue to operate in a capacity, and this is dissimilar to precrisis. Have we not learned our lesson on the optimistic side . Simon hobbs, back to you. Have a safe and prosperous new year, sir. Have a good night. See you monday. Rick santelli there in chicago. Coming up on the program, selfdriving cars and Virtual Reality. Just a couple of areas that could see major growth in 2016. Well look at some of the tech trends you need to Pay Attention to in the new year when squawk alley returns on cnbc after this break. Bring your family and friends together to discover the best shows and movies with xfinitys winter watchlist. Later on, well conspire as we dream by the fire a beautiful sight, were happy tonight watching in a winter watchlist land, watching in a winter watchlist land xfinitys winter watchlist. Watch now with xfinity on demand your home for the best entertainment this holiday season. Announcer for the new mattress models during sleep trains huge year end Clearance Sale. For a limited time, save hundreds on tempurpedic mattresses. Get the most highly recommended bed in america at closeout prices. Plus, get interestfree financing and sameday delivery. Why wait for the new models . Sleep trains year end Clearance Sale is on now superior service, best selection, lowest price guaranteed sleep train [train horn] your ticket to a better nights sleep 2015 was the year of the drone. The faa producting more than 700,000 were sold during the holidays alone. 2015 was all about the drone. Just what will be the top gadget for next year . Joining us here at the nyse and gadget managing editor dana. Its hard to imagine the drone wont capture our attention next were. What else will join its company . Im. Im sorry . I said what else beyond the drone . What will capture our fascination next year in the gadget land . Oh, great. First of all, thanks for having me. I think next year were going to see a lot of well, were going to see more move towards driverless cars. I think tore certain in several years until we see proper fully autonomous cars, but i think this were well see even more steps for cars taking some of the dirty work out of driving for us and perhaps making us that much safer on the road. There are potentially a lot of very splashy announcements coming our way next week at the Consumer Electronics show, which i read is devoting 200,000 square feet. More than three football fields just to showcase. What are you expecting to see . Will any of it be closer to the road than what weve seen so far . Its going to be a sprawling selection. Its going to take quite a few days to comb through all of it. I think that the two of the biggest themes are going to be cars like we spoke about, but also a selection of really smart home gadgets. Really wifi, internet connected everything. Refrigerators, dish washers, laundry machines, doorbells. You name it. Running the gambit from big to small. Thats the job to go through all of the smart home objects and if going to figure out what do people need and whats useful and more superfulous. What do you think will gain Critical Mass there . Is it going to be the individual application, or is it going to be the platform, the system through which its delivered next. Obviously springs to mind. Google. Will we say yes, i want the doorman, or will we say i want everything that comes through nest . Absolutely, the platform. I think we have no shortage of smart objects. I think what we need is a way to make it ease wrer for average folks to use, and if its not easy to use, people wont use it. The interface needs to be simple and there needs to be an allowance for all of these gadgets and smart home objects to communicate with each other. I think if they can communicate with each other, theyll behavior that much more intelligently because theyll learn more about the persons habits at home. Happy new year to you. Happy new year. Up next, a huge new milestone for uber. What it means for the company. Plus, make sure you tune in on monday. Well have an exclusive interview with San Francisco fed president john williams. Right here on squawk alley. Dont go anywhere. Looking for 24 7 digestive support . Try align for a nonstop, sweettreatgoodness holdontoyourtiara, kindofday. Live 24 7 with 24 7 digestive support. Try align, the undisputed 1 ge recommended probiotic. Just reported a short trip in london marked the companys one bill yont ride since 2009. Are you looking at some of the new Year Celebrations across the world, which we have been bringing you all hour long. Meanwhile, uber had the million ride a day mark, and in september ceo travis told fast company it was up to two million rides a day. Lucky passenger marvin won a years worth of rides from uber. It happened overnight. Five pound sterling. 7. 41. Uber x ride in london was number one billion. Simon. Perfect. Its fun, and its new years eve, and everybody around the globe there you go. Just as we look at that, theres actually we could have some celebration down here on the new york stock exchange. We are about to close the gap for the losses that we had earlier in the session. Remember, to be break even for 2015 the s p has to close at 2,058. Now, we came in four and a half points ahead of that. We dropped. We are now cutting those losses, needless to say, were able to close flat on the s p, all positive. It would be a huge help for people who have to sell stocks as a living to other people in the streets. Down year is kind of difficult to argue, though. Bed, bath telegraphing worse than expected sales. We know whats going with the e. Coli outbreaks. A couple of stocks to watch. A lot to watch in the year to come. Thanks for being with us all year long. Thanks, simon, for being here with me today. For now lets send it over to mandy drury and the halftime report. Going to be seeing you for the rest of the day. Its already many my head. Welcome to the halftime record. Im sitting in for scott whopner. We have josh brown, jim, and michael block of rhino trading. Hello, guys. Good to have you with me today. Domination ends tonight. Our front runner is currently mr. Josh brown. He is going to break down his winning strategy. Also new years resolutions. We all have them, right . We all