Monday and mild upside in the markets this morning. Our road map with market highs, record close for the s p, futures pointing to that higher open. Caseshiller the data point today. How the sausage gets made, deals lost and launched. The latest, pilgrims pride unveils a 6. 4 billion offer for hillshire brands. And rosie the robot meet mac the computer. Apple set to unveil jetsonlike software for a smarter home. Your iphone coming soon as a Remote Control for your life. But first up, futures on the rise as each of the three major indices did enter the shortened trading week for the year. S p set to open at an intraday high closing above the 1900 level on friday as the u. S. Markets turned in their biggest weekly gain in over a month. After all the nashing of teeth this month, jim, dow and s p are on track for four straight months of gains. Were hanging on by a thread. Many people who came into this month thinking the earnings werent that good, a lot of fear built up, there were many sizable gurus with following saying listen, be very careful. Dave tepper, a terrific guy, i think ive now parsed his words again, saying get off margin, somehow that became sell stocks. Tepper wanted you to have fear which is never wrong after a very big run. But whats happened is that there was even though the vix didnt jump, there were a lot of people who said this market is not that good. In the interim you get a hillshire brands getting a bid and thats been a theme throughout may. M a has certainly been important. Well talk more about the specifics of that overbid, but it has added, it would seem to me, to the positive. Yes. Tone if you will. Finally, and ive been saying it, m a is back. Theres no doubt about it. Whether its Companies Seeking an inversion or simply seeing value, or willing to actually take more risk, it is back and that certainly redowns to the positive view of the market. Its amazing youve had the run with 17 of the s p not participating at all which is the banks with china clearly not doing much at all and theres a lot of export companies with a very limited group of people, group of stocks taking the market up here but its the transports. They look at fed ex, have you seen the rails here. These are commerce oriented. With the durable goods and also been a selfcorrecting mechanism. Interest rates have come down. Were not talking about it enough. The Home Builders are saying it was a late spring but it is happening because Mortgage Rates are coming down. Are you on alert for a breakout given that transports and teches have had to carry the water by themselves. A vacuum this year has meant positive, not negative. When you dont have a lot of earnings and you do i think that, you know, i think this year was summed up by hewlettpackard. You have a 330 release by surprise. People look at the headlines and say hewlettpackard looks like its not coming together. Looks like the pcs arent doing well. Then meg whitman comes on our show, i did not see anything else that occurred, goes and tells a very positive story, convinces people you know what, its not nearly as bad as you think, next thing you know you have the number one performer in the s p 500. That was that was surprising in a way friday. I dont know reassuring. I dont know if people were misreading the afterhours movement which might have been based on small volume. I dont want to ascribe too much significance to our interview. The only thing out there. People were saying what happened, what went up . What occurred . And i go back over the interview and with david, correctly, i thought, tried to poke some holes in the story and the story was iron clad. Layoffs, coupled with a little Revenue Growth is going to produce some pretty good leverage to the numbers, not as bad as it used to be. Other stories similarly. Foot locker puts it to dicks and i thought that was important. You saw a kind of suggestion followed up by auto zone today that retail is not nearly as bad as you thought. I come back and say, when you have a couple of retailers telling a better story, lets use fresh market against whole foods, but it started to seem like last week was some retailers arent getting it right, other retailers are getting it right. Dont write off the consumer. Mortga mortgage is coming down. Consumer stronger. Personal stuff for hewlettpackard was better. Bring it together, best buy and gamestop werent bad. Lets move on to deals. Sure. Shall we . The biggest of which this morning another hostile or ill call it that, they never do. Pilgrims pride offering to acquire hillshire brands for 45 a share in cash. Just a couple weeks after hillshire agreed to buy pinnacle foods. That deal worth about 4. 3 billion. I think that including debt. Pfizer has withdrawn its multibillion oh, yeah, hundred plus billion offer to acquire astrazeneca. Lets start off with the hillshire overbid if you will. Yes. Again not just deals but unsolicited deals are back. In the case of pfizer which well talk about in a minute, didnt quite work out that well. Perhaps because they werent willing to go hostile and didnt from the very beginning. Obviously Allergan Valeant still out there. This one now, they come over the top, 45 a share, hsh stock going to be up sharply, seem to be trading in the premarket around that 45 level. These two companies together would produce on a last 12 months 1. 4 billion in ebitda, match up fairly well. They were there, that is, pilgrims pride was there in february and came around and said would you guys be interested, hillshire, in doing a deal. Would you be interested in perhaps letting us acquire you. Sitting down and negotiate. They were told no. They did not at that point, i am told, come with a price of any kind. They sat back, the question we dont have the answer to is, did hillshire move ahead with the pinnacle deal to avoid the clutches of pilgrims pride or simply knowing they might be there to say well f they still are there, we might be able to get more out of them with this in hand because they do have section 5. 4 of their merger agreement will allow them to contemplate the hillshire board, the exercise of its fiduciary duties a superior proposal essentially and a law pilgrims pride to talk to management, negotiate do diligence and if the board believes is superior we really this deal not the deal that we were previously doing. This was important because if you remember the day it came down, hillshire stock was going up almost as much as pinnacle. Then there was a Conference Call where people felt very let down by hillshire which happens to have a rock solid Balance Sheet and cash position and a takeover candidate. Jpmorgan downgrades them saying you know what, we expected more from hillshire. Clearly jpmorgan had an inkling there must have been someone else. Mr. Gamgor, the ceo of pinnacle, i thought got the bums rush. Almost as if guys, this deal hell or high water is going to happen and i think it was one of the great defensive offerings by hillshire. I took away a niche company, the old sara lee, made it so it was an unwealding conglomerate with birds eye and duncan heinz being the next level of growth. These guys are willing to pay the termination fee by the way. If you follow the scenario where they say it is superior and have to break the pinnacle deal, it would be 163 million. Theyre willing to pay it. They come with a fairly strong case here. Well see what the ultimate price may be if they do enter negotiations. Obviously the shareholder vote is another way that they could win, so to speak, that being pilgrims pride, they missed the annual meeting, but they are relying on the section 5. 4. For pfizer real quickly, now its all dead, mostly dead as they said last week. Six months, right, for a new yes. Unless they invite them which 90 days. Three months if they invite them. Astrazeneca perhaps getting some pressure from its shareholders. Stepping back, the strategy employed by pfizer and its advisors has led to many questions. There was a strategy . There you go. What was the strategy . Either you why not come hostile out of the gate . Then you would be in conversation with astrazeneca shareholders which is the way it works under uk law. You might even have a deal by now. Then the final back and forth which didnt include astrazeneca where they went to 55 pounds or it seemed, but they only went 53 something in the press release. Ga if them a day to own the news cycle. Questions about pfizer strategy, none of which matter at this point. They said so long. All the stories about deals either not happening or might not happen, right . Pfizer, ge, hillshire, allergan, is that the function of a regulator market or Something Different to it at this time . I mean each of them is their own scenario. France, for example, in the case right. And but i think it is more a case of a vibrant m a market than it is anything else. Were starting to see deals of all types. Obviously inversions continue to play a very Important Role here. Not just for pfizer but in the case of valeant which already has that great tax rate and allergan perhaps not going to be able to find a white knight because they wont be able to find the same cost saving ability because they wont have an inversion, whoever might, but yes, in answer to your question its more that. Although it is interesting to note, carl, each of the different issues. You know, i had dr. Cook on friday, the ceo of isis. You asked me to look into the pipeline, the cancer pipeline of astrazeneca. Its largely isis pharmaceutical. I think thats interesting because isis is an American Company on par the isis formula, which is an rna therapeutics, its novel i think is terrific for cancer. Its so interesting that they would rather pfizer hundred billion to get astrazeneca, but it is youre spending a fortune and really what im saying it really was decided by tax. Because if its the isis cancer product, you really wouldnt you could go buy isis and save a lot of money. But isis is located here. Thats too bad. Yeah. At least for now. Too bad just a great country that has great scientists. I wish we had a tax rate. Thats a great point, jim. When we come back, Nobel LaureateRobert Shiller will break down the caseshiller home price number and offer his outlook on real estate. Squawk alley 11 00 a. M. Eastern, the reverend Jesse Jackson, why is he showing up at google and facebook shareholder meetings. Hell discuss his push for more diversity at Technology Companies out west. Dow hanging on to a 25point gain for the month. Four sessions to go left in may. More squawk on the street live from post nine in a moment. Nine. Lets get back to the key housing data. The latest s p caseshiller number showing u. S. Home prices rose slightly month over month. 19 of the 20 cities showed positive returns in march. On the cnbc news line is Robert Shiller, cofounder of the caseshiller index, Nobel Laureate and professor the economics at yale university. Good to have you with us again this time i think from korea . Yeah. Im in seoul. Good to have you. Interesting report, you used the word substantial slowdowns in price gains. And the easy takeaway is that the Housing Market is losing momentum. How much of this is due to the fact that comps are getting tougher year over year. Well, i dont know exactly know why the numbers you know, its not a big slowdown. The year over year is still up 12. 4 . You know, im a little puzzled by it because but it isnt a big change. Mortgage rates are down. And that ought to be spruring the market a little bit. But we dont see a big its not a big change this month. The market is still on the up, at least looking at price data, you know, theres always been a lot of momentum in the Housing Market and it still looks up. And it still looks optimistic. Every month we talk to you about these numbers, we talk about the dynamic of cash investors, people who are either investing for institutions in housing or paying cash for homes and then exiting the market later on. How much of that do you think is at play here . I think investors remain a very important force. One thing that was different, you know, back in the early back in the boom years it was individuals buying their own homes or their own second homes that were driving things. That was a different psychology. That was a time i cant completely explain it, but now, the psychology has changed. Homeowners seem to be losing interest, investors, at least until recently, have been very excited by the upward momentum. They seem to have learned about momentum. Robert, its very interesting to see that new york city was the only city to decline. I know that new york prices had really skyrocketed. Are we starting to see resistance literally on price in new york city . It sounds that way, but it isnt only new york that declined seasonally adjusted basis. A couple other cities. Right. Dallas and denver. Last week, frank light, the co of home depot, was talking about how that rates went up so fast that maybe the real issue with Interest Rates they never should have been where they are. Implication being that dont be surprised to see rates down to 2, 2. 25. What do you think that would do if we saw a decline of that magnitude . Well, recently the tenyear treasury was at 2. 5, so it wouldnt be an enormous surprise. But i think that yeah, i think that these declines matter. I think people are watching Mortgage Rates. You know, they remember back when Mortgage Rates were 3 got down to 3. 35 in late 2012. That, i think, has a big psychological impact and now the Mortgage Rates are down to latest number from freddie mac is 4. 14, thats getting back down there and that might stimulate the market. Finally, robert, big story in usa today about home equity lines of credit. Up 20 in the past year. Thats the fastest increase since the crisis. Do you think the Housing Market will be an engine for Consumer Spending in the year ahead . That is a distinct possibility, yeah. I think it is on the way up at this point in time. When they learn to respect momentum. I think other people are respecting it too and might affect their purchasing behavior. So things are still looking positive, despite some bad news we had on housing starts. I think that its still looking up. Robert, great to see you. Safe travels home. Well talk to you next month. Robert shiller. Great. Caseshiller home price index this morning. When we come back cramers mad dash, count down to the hoping bell and disneys blockbuster frozen living up to its name with an ice show as they milk that franchise. Oh, boy. Well talk to the shows producer later on. 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Deutsch bank upgraded cisco hold to buy. New product ramp is stronger than expected and the actual new products are revealing some very solid booking trends. You know i felt that was the quarter turner. Ive been waiting for cisco to reveal the few products and to see how theyre doing. Ciscos ad campaign apparently doing well. John chambers more fired up than ive heard him in many years visiting the 100 largest accounts and examining through with a very good depiction of business. U. S. Business is back on track. I like cisco. Now, you know, you followed this company relatively closely for many years. Since 94. I kept an eye on it. Feels like every time we think they have wind at their back and real momentum Something Else comes along and then we have to reassess. Im not going to disagree with that. Its been a fits and starts situation. I like to see that the u. S. Is doing well. I mean, is china doing we dont know china. We know that china is pushing back because of nsa considerations. But this is a north american story, could be a turnaround. Again, john chambers, its been a little hit or miss. I think its hit and i think its more than a one quarter phenomena. Because new products have a long tail here. The company is back. Its inexpensive and i also like the dividend. Lets move on to bank of america. All right. Bac. Were beginning to wonder, was bank of america the problem with that 4 billion error, is that a tempest in a tea pot. New capital plans submitted indicating its a very, very minor issue. Who knows what the fed will do. However i would tell you this killed the stock. It absolutely killed the stock. Because the quarter was fine. I understand the company to be having som