Alibaba shareholders likely view jack ma as one of their heroes following fridays successful wall street debut and record breaking ipo. Good morning welcome to squawk on the street. Im david faber with jim cramer. Live from the New York Stock Exchange. Carl quintanilla has the day off. Futures this morning because we are looking down. Perhaps china. Im guessing, jim. Its all china. Its some statements out of china saying, listen, we dont need to stimulate as much. Were willing to accept decline in the growth. Growth. 7 now, some saying in gdp. Keeps coming down. All right. Our road map this morning and it starts not with china but right back here in the u. S. With the iphone. The official initial Sales Numbers just out. Guess what . New record, tim cook says they could have done better. Alibaba setting records. Biggest ipo in the world not just u. S. , we knew that would happen friday. What did push it over the line. It wouldnt be monday without a couple of deals. Weve got two comes from overseas. Well break them down for you. And a lot of talk, as well, speaking of m a about hewlettpackard and emc. And eve dell. A lot more on hewlettpackard emc, what emc is thinking about right now. Very good. Its so opaque. Looks like its keeps being floated and nothing happens. But i have learned from you that, when its being floated, eventually somebody wraps it. Interesting parts of the discussions with h. P. , which h. P. Shareholders should listen up for. Apple, its a new milestone for that company, alounnouncing first weekend sales, topped 10 million mark. That is a new record in apples release announcing the sale. Tim cook said results exceeded expectations, adding, quote, we could have sold many more with greater supply and were work hard to fill orders as quickly as possible. We call that a highclass problem. Right. I think when we listen to this, do we really fret that china is not buying yet . That because it wouldnt matter. There arent any phones. This is now makes it so i feel better about q4. I feel better about q1. The way apple has to get to 120, 130. What you need is a sustained Worldwide Growth in earnings. And i think that you get that from this, which is going to have very big margins. One where we havent heard from carriers yet. Can you imagine . We havent heard from what sprints going to do. Nice that we played the ma interview. I think the soft Bank Interview had a lot to do with apple. Tell me why, though. Talking, of course, about our conversation with mas son, soft bank. Alibaba, that was big for him. What do you mean . I look at sprint and i think that what people dont recognize, sprint is inferior network. Where did i get it from, dan hessy, former ceo. What does sprint have to do to get customers . They have to become the low cost provider of those to you. But i look at tmobile and i think, what is john leisure going to do . Hes said hes going to throw sprint under the bus. Y now two companies literal will give you more apples than you thought. This is how you get multiquarter rollout. Those who trade apple, sell it on friday, come in, have to pay up monday, thats not working for people. The and reason its not working for people, some company has a better product, we can listen to blackberry on friday about their new product and say samsungs got something going on. But the fact is this is taken the world by storm and its just, i think, people kind of yawn ahead of it. Oh, another one. I mean, what does it matter . Turned out to mat air lot because features are great. No ones talking watch. How about q3 for watch . This, from what we thought the watch wasnt available for the holiday season, oh, no, a staged rollout of apple products. Really good. 10 million, and as you say china not a part of it but we dont know how many phones people have been waiting in line for here. People wait in line to sell on the black market in china. Youre kidding. Im not kidding. What is that . New way to make a living . Well, a lot the economys not that great for a lot of people still. Shouldnt you be buying cigarettes and selling them . Im sure thats going on. Jon fortt sitting next to me, later on friday after you left, and he had both the plus and the 6, he took a picture of the huge crowd here behind us for the alibaba ipo. I took a picture with my iphone, difference in quality stunning. Difference between hd and regular where you look at regular and you cant believe its blurry . Yeah. His picture so much nicer than mine. A major, major innovation. What we discover every day, there is one of the things that apple does very right they do the presentation. Its only after you start fooling around with it that you realize its much more powerful. And by the way, the pc does not get more powerful. No. No. The pc just becomes more antiquated. Big iron, e mechltmc or hand. The gulf in the middle without 3d printing, without something thats got pizazz, you end up being stuck. Look at oracles numbers. Their core business, its not oracle one of the companies, at least emc talking to. Is that true . Yeah. Some of that that is big. The journal, and today i can confirm that. It doesnt mean anythings going to happen. Back to h. P. On printers and pcs. But first, lets talk alibaba. Because it does now rank officially as worlds biggest ipo ever, surpassing 25 billion after the underwriters exercised option to purchase additional 48 million shares from alibaba. Its the green chute. Certain sellings shareholders as well. Chinese ecommerce giant surges in its debut friday. Shares up 38 above where the stock was prices at 68. It was stunning. It was yes. We we hype, no doubt, but that thing was actually worth the hype in a lot of ways. I mean, its as big as walmart. At the end when i left the set at noon and looked, it was around 240 billion market value. You think, its 5 billion from walmart. A tremendous number of articles, again this weekend, as on the same day, unsustainable, unsustainable, unsustainable. I listen to jack ma, yes, the rununsustainable, its about to have a leg up. The big mutual funds took it. One of the things people dont understand behind the scenes, david, is that you can to some degree control price. Try to keep Retail Investors out. Keep hedge funds out. You end up just mutual funds that get half or a third of the allocation and then have to come in and buy in the aftermarket at 100, they were released. Anybody who bought tonight the deal was able to sell it, and theres no there was no punishment. I spoke to a few hedge funds who worked extraordinarily hard to get whatever allocation they could and, as you say, underwriters will slap you back if you think about entering the market quickly. But they did. They did. Mid 90s, they were done. Right. They were largely out of their entire position, i wont say obviously who, and i asked, why would you do that . They call it risk mitigation. At the same time, understand that nobody, everybodys attuned to the idea that there is an absurd place for this thing to go. Earnings basis, all that did at 100, get it to where you say its comparable to facebook. Some say ones retail model, ones a proprietary. What about the discount, chinese company, not a great deal of transparency and risks we dont fully understand. Remember when we asked jack, jack, mr. Ma, about china slowing. Remember, this is half of the people half of the countrys on the internet and of that half, only half are customers. And it seems to me we always seem to forget that they just arent stored over there. Remember, when you go down, youll see in our cities and then in our suburbs store after store that dont exist. If china. I think the stock can come down. I believe, david, every time the stock goes into the 0s, buyers will come back, they get the average after 68. This thing, they did not bump and they did not expand. True. That was disciplined. Im sure that was jack ma saying, huhuh, i know that im customer oriented but dont screw it up. Joe sigh went through every allocation. 1700 different accounts, checking each of them. Dont you think of the American Companies that come public, most are not nearly as sophisticated about the way our system works as they were . I doon think they are as attentive to something along those lines and making sure its who with us previously. I will say this, it becomes a way to play macro china, right . I totally agree. Wait 7 gdp, no stimulus, maybe ill short alibaba. Right. Or go the other way. Stimulus, buy alibaba. Youll see the most deep value stocks in the market, the companies that sell into china. They just it just seems like boats arent going in anymore now that the freight, i monitor that, thats been stable for a while at a low level. The day rates, by the way, for oil tankers, have you looked at those . Through the floor, china. China has basically gone offline for imports but not the Consumer Market where its extraordinarily strong. Where they continue to try to stimulate. By the way, the larger story for the market this morning. We forget if you go back to 2008, when the market peaked that was china peaking, too. Caterpillar, by the way, we had a great interview two years ago, it now seems to be coming true. Yeah. Caterpillar, i know you say the market went up big, it didnt go up any more in the market but that group of stocks did well. Those stocks are really under a lot of pressure. All right. Well talk more m a after we take a break here. Emc, of course, in the m about a spotlight, with hewlettpackard, talks between the two, i can give you insight as well. Also big deals from germany. German Companies Buying our Companies Left and right, the trw deal last week, two deals today. And not to mention, also going to speak with david wei, his take on the wall street debut and its future. Another look at futures this morning as we digest, you know, i guess, largely china. More squasquawk on the street after this. You know. Theres a more enjoyable way to get your fiber. Try phillips fiber good gummies. Theyre delicious and an excellent source of fiber to help support regularity. Mmmm. These are good the tasty side of fiber. From phillips i have a cold. I took nyquil but im still stuffed up. Nyquil cold and flu liquid gels dont unstuff your nose. Really . Alkaseltzer plus night rushes relief to eight symptoms of a full blown cold including your stuffy nose. breath of relief oh, what a relief it is. Thanks. Anytime. Big shot, tell you what tell you what welcome back. Reports this morning in both the wall street journal and New York Times, which i can confirm, detailing emc and hewlettpackards efforts at getting together in a what would have been blockbuster deal. Allstock transaction. They were speaking for months. They are no longer talking, jim. Of course, a lot of this comes in light of, as we know, activist investor in shares of emc, arguing that its 80 stake in vmware under valued and a ceo leave in february. Joe tuchy. These predated ownership of elliott, that is, emc and hewlettpackard. And they were advancing, in fact, people familiar with the situation tell me, you know august it did appear they were getting close to a potential deal between hewlettpackard and emc. But they never were able to fully mount issues having to do with price. Sources tell me, emc wanted a big premium, it would have been allstock transaction, whereas h. P. Wanted to do an atmarket deal. It gets back to combined ownership of respecter Shareholder Base of the combined company. And so it did not happen. Meg whitman would have been ceo of the combination, again, as we mentioned, tuchy stepping down, might have been chairman for some time. Right. When they previously, ralph witworth, not executive chairman, shes chairman and ceo, meg is. Didnt happen. But whats also interesting here, i dont want to make too much of it but they were considering as various plans came through and they continued to discuss spinning off psg, personal system groups, spinning off printing as well. So thats core. Right. Well. It is considered one h. P. Still, but it does show you theres a willingness at h. P. Clearly to consider a lot of Different Things now, including something weve talked about many times and the last regime, considered doing or was moving to do, which is spinning off pc. Hewlettpackard is dramatically undervalued, if thats the case. Willing to take forceful actions. I know theyve got 3d issues in the pipe now. I talk about 3d, its for the retail investor. Hewlettpackard has a lot of value. The fact theyre willing to entertain, whether emc, getting ow of printing, out of divisions that lagged, one time we talked about ibm and emc but ibm doesnt want to be in hardware. Storage and cloud make a lot of sense, ups their cloud offering a lot the hewlettpackard. Again, it doesnt appear things are revived at all. Why do you say that . Im watching emc stock. Is that for people saying, listen, if theyre for sale, someone will come in, dell chatter, someone what surprising . I think, a, theyre under pressure from activists at elliott, and, b, they do seem to be from what my reporting leads to exploring a lot of different options. And so i think theres an exp t expectation they may reach either some sort of other sale and or split and or sale of division. Unclear how many theyre looking at a lot of Different Things or perhaps nothing. But theres a lot going on at emc right now. Vmware the driver. Its funny, we see two downgrades of yahoo today. Yes. Bank of america, merrill, serious downgrade. Reads badly. Talking about Marissa Mayer not knowing what to do with capital. People are disrespecting her at a level which is extraordinary. Theyre saying whatever she does its going to be wrong. Remind me of vmware, if you bring out vmware without having a lot of tax, emc is undervalued but no ones able to unlock that. Great comparison you draw of course the remaining alibaba stake at yahoo and something ive talked about here endlessly, how do you tax efficiency sell that at some point. You cant. Well, not necessarily. Ken goldman, their cfo, trying to figure out ways you can. Talking yahoo by the way, if youre following us. Understand if you do the looksee at yahoo you say, wow, look at valuation of all of the different assets. Clearly the companys valued minus two. Look at vmware, back that out, say emc is just it seems like youre getting it for nothing but youre not because theres a giant began tick tax bill no matter what. Well get back to yahoo take a look at stock when it opens trading as well. Weve got more, of course. Hewletts big news. Big they would be willing to willing to consider many Different Things, hewlettpackard. Of course, does it reflect negatively on the view of the business . No, i dont think so. I think they see theyre not doing well, theyre willing to go with it. Thats a meg whitman style, i like that. A lot of deals to talk about. So much more to talk about. The mad dash coming up from the man to my right, to your left. Opening bell next. Later, sarah talks with Jose Manuel Barroso about the challenges facing europe and the economy. One look at futures. Back with mad dash after this. S philosophy is, reynolds . No. Not exactly. To attain success, one must project success. Thats why we use fedex one rate. 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So you can invest in the life that you want today. Tap into the full power of your fidelity greenline. Call or come in today for a free oneonone review. Strike it up this band is going to play my tune strike it up all right. Its a monday. Weve got a mad dash. Opening bell seven minutes away. Start off with a look, rumors on clorox and fact. Like the idea you called it rumor. This is a story in the New York Post this weekend saying its for sale. Donald retired earlier than i thought. New ceo. The companys growth challenge but did fight back a very important incursion buy, karg icon, getting the stock higher. Great dividend play, too. One reason it could be going up, more than the idea there dowel be a takeover. The number suitors, be careful about proctor, the government disallowed that combination 50 years ago. Theyre getting out of venezuela. Anybody who suffered through a clorox Conference Call in the last three years heard them say, charge, charge, charge venezuela, venezuela wont let them play prices. Getting out of venezuela is the bullet that must be bit bin a lot of companies. If proctor would do it, proctor would go to 90. Keep in touch with the idea, getting getting out of the venezuela. People dont understand, this is big market that everybody felt if we hang out after chavez he will become part of the western hemisphere. Again, they havent. You dont want nobody venezuela. Moving on. Now, one of the thingses that been continually misunderstood the decision by cocacola to buy a big stake in monster. Monster uses the cocacola distribution, i think monsters not unlike what happened with Green Mountain coffee where cocacola keeps coming back and back and back. Monster should be dramatically higher if able to plow the distribution network. This is red bull. Wheres monster mostly sold . At Convenience Stores. What happens at Convenience Stores when gasoline goes down, sales spike. What do they buy . They buy tobacco, they buy chocolate, and they buy energy drinks. Monster goes much higher. Much higher from here. Much higher. You believe that to be the case. I do. That was quite a move up, that the market gave credit for when they announced the deal. Its significant, they have nobody else is able t