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CNBC Exclusive: CNBC Excerpts: Billionaire Investor Mark Cuban Speaks with CNBC’s Brian Sullivan on “Power Lunch” Today

WHEN: Today, Friday, November 6th

WHERE: CNBC's "Power Lunch"

Following are excerpts from the unofficial transcript of a CNBC EXCLUSIVE interview with billionaire investor Mark Cuban live from Dallas on CNBC's "Power Lunch" (M-F, 1PM-3PM ET) today. Following are links to the video on CNBC.com: http://video.cnbc.com/gallery/?video=3000441737, http://video.cnbc.com/gallery/?video=3000446790, http://video.cnbc.com/gallery/?video=3000446862 and http://video.cnbc.com/gallery/?video=3000446864.

All references must be sourced to CNBC.

CUBAN ON OIL

I think people understand that it is on the margin. It's going to vary and it's going to go up and down. As long as the intrinsic economy continues to grow, I don't think we're an oil-based economy like we used to be. I think it's more generally based.

CUBAN ON MARKET ISSUES

You're going back to the flash crash. October 15th the Treasury crash. I mean there are so many market structure issues that no matter what you think in terms of the market, you've always got to be hedged. To me that's terrifying. I mean literally we're having conversations about lack of liquidity in treasuries. I mean how is that even possible. And it there's lack of liquidity and there's market structure issues in treasuries, what happens if there's a flash crash in treasuries.

CUBAN ON THE SEC

Cuban: The first question is what's the purpose of the stock market. And then the second question is what is the purpose of the SEC. And if the purpose of the stock market is to enable capital formation then the SEC should be making sure it's safe, making sure people trust it, and making sure that corporations can go to the market and do it. Well the number of enforcement actions is not related to any of that. Right. If you want to go out and survey investors and say do you trust the stock market more today than you did five years ago?

Sullivan: They'd say no

Cuban: Of course. So that means the SEC is not doing their job.

CUBAN ON TECH VALUATIONS

I like catching a cold stocks, right, where when that stock catches a cold, a whole industry feels it. So I think public tech valuations are fine. On the private side, there's two worlds. I like to play the arbitrage where I invest in companies outside of Silicon Valley and then try to sell them inside of Silicon Valley. And I think inside of Silicon Valley they are very insulated and I think they are going through a bubble…It's very difficult because you don't have an outlet. So if they're going to grow their company. 20 years ago when we did broadcast.com our intention was to go public. Now what are they going to do? Unless they get to an Uber size and dominate, the outlets are tough. Like you mentioned with Square, Square's going on a down round. When going public is a down round, then you know the valuations are out of whack.

CUBAN ON TWITTER

I broke about even. I mean I didn't buy it that long ago, so when they brought in Jack Dorsey, I though ok, so it's going to get a little bit of a bounce. And then they're going to do moments and that should help it. And they're bringing in other things, that should help it trade up…If they were in a vacuum and there was no Facebook, we'd be thinking this company is amazing, right? The problem is we compare them to Instagram which is part of Facebook. And Facebook is eating the world. So it's not so much what Twitter is doing wrong, it's just relatively speaking it's a tough market.

CUBAN ON CONTENT

There's still 98 million television homes, right? It's not like its shrinking dramatically. If you look at the net ads, I mean, I think between cable, and telco and satellite, they're about flat. So I think what's happening is those traditional companies that are in distribution have got to respond. If we don't, then you might see an acceleration in cutting the cord. But until then, I think my biggest guess on Netflix is you're going to see them try to sell content on traditional distribution and compete with HBO in HBO's home turf.

CUBAN ON NETFLIX

So if Netflix is creating so much original content to compete and control their own destiny, which they are, why wouldn't they just pull an HBO and go to Time Warner and say ok you sell it for 25, we'll keep 12, you keep 12.50, right. And we'll both be happy. And that opens up a whole new market for Netflix. And kind of starts the path to maybe destabilize what HBO and some others are doing.

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