CNBCfix

[CNBCfix Fast Money Review archive, August 2009]
[Monday, August 31, 2009]

Fast Money Review: Key CEO
says Obama plan still unknown

Featuring: Jon Najarian | Melissa Lee | GS | Karen Finerman | Guy Adami | Pete Najarian | Joe Terranova | Craig Berger | INTC | MRVL | FSC | MSCC | Greg Troccoli | CAT | Mandy Drury | PDE | RIG | OIH | MHS | David Snow | "We don't know what the Obama plan is yet" | AZN | BSX | WPI | JPM XHB | DWA

Apparently Charlie Gasparino isn't the only CNBCer accused of going easy on Goldman Sachs.

"Everybody says 'Oh yeah, you're always screaming for Goldman, you're a cheerleader for Goldman," Jon Najarian announced on "Fast Money" Monday. "No, I'm not."

Rather, he said, he thinks GS is the "canary in the coal mine" for the entire market and continues to show strength.

"They cannot push this stock down," he said. "That's why I say, I don't need to play defense right now."

As a result, he made the semi-rare "Fast Money" move of declaring what would happen in tomorrow's market.

"September gets started tomorrow," he said, citing data that says "70% of the time the first day of the month is up about 4/10 of a percent. I think we'll be better than that tomorrow, based on the close today. ... I think you can get ready to play some offense."

Actually, offense isn't the specialty of the Najarian family; both Jon and Pete were linebackers.

But Dr. J's call on the banks way back in late February or early March (something about "if they relax mark to market, these stocks will double in no time") was better than any TD pass Vince Evans could throw.

Jon Najarian wasn't the only one on the show Monday talking about canaries and coal mines. Craig Berger of FBR, a reliable guest analyst, came on the set and said, "One canary in the coal mine, is, is, Intel preannounced last, last week, but a lot of their revenue upside came from chip sets, and not the CPUs. Chip sets are bought generally a quarter ahead; that suggests good continued momentum in the fourth quarter.

"I remain constructive on chips," he added, citing several bits of evidence. "All of this bodes well for continued chip shipments in the fourth quarter." He said a previous recommendation, MRVL, is "still cheap; I continue to like it." As for INTC, "I think there's other more attractive names," perhaps FSC and MSCC. On a July 13 appearance, he mentioned MRVL and FSC but also BRCM.

Chart guy Greg Troccoli also visited the "Fast Money" set as part of the day's theme, is the Chinese market an indicator of the U.S. stock market. Zach Karabell and Jon Najarian are on the record (see "Halftime Report" below) as "no," while Mandy Drury sounded like a yes. Troccoli sort of took middle ground, saying there really isn't much of a correlation, but people tend to view it that way, so it's a "self-fulfilling prophecy." He added a bearish note on CAT, "if China is cooling off, that will certainly affect Cat."

Guy Adami definitely sees things the Mandy Drury way here. "Everybody wants to discount the Chinese market, blah blah blah...You can't discount the fact that it takes commodities down, commodities go down, S&P goes down, they do have a lot of correlation."

You also can't discount an opportunity for Guy to predict the market's demise, today's catalyst being the 47-point Dow drop. "You know I think we're on the beginning of something here ... " he said, and really do we need to say more?

We were excited about the return of Karen Finerman, who wore magenta but more importantly looked to have a haircut. Karen indicated any trough in stocks won't be terribly deep, employing one of our least favorite cliches, unfortunately. "Lot of cash ready to be deployed," she said, "so that makes me wonder how much will the market ... pull back if there is a lot of money on the sidelines, which there is. ... On anything that moves easily, I'm gonna be out there buying."

A couple names she mentioned were PDE ("they are I think right in the sweet spot") and RIG, around $72 or $73, "I would be a buyer there."

We really wanted to hear Karen talking about the dash for trash last week, but she disappointed on that subject by really not offering an opinion. She said of AIG, "this is a name I would just stay away from on either side."

Adami sounded another warning on the OIH. "I still believe it's headed down to 97, 98."

David Snow, CEO, of Medco was very soft-spoken and articulate in a visit to the "Fast Money" set, but, aside from saying he favors some kind of health reform, he wasn't exactly prescribing very many specifics.

"I think net-net, we don't know what the Obama plan is yet," he said. "Everything's on the table. I believe that something meaningful will get done. So what's meaningful? Um, I do believe that we will get a pathway for a biogeneric, and yes that's fantastic for Medco. I also believe, uh, that we will do something for the uninsured, probably not to the extent the Democratic Party originally intended."

Interesting.

After the president spent two years of campaigning and six months in office telling people how important it is to do something on this subject, the CEO of a very important player in this industry says, "We don't know what the Obama plan is yet."

So people around the country, congressmen, regular joes in town hall meetings, are all arguing about a presidential "plan" that is either 1) a secret, or 2) doesn't exist.

In other words, there never was a "plan;" there was populist rhetoric during a tight campaign, floating various concepts and waiting to see which if any would manage to gain nationwide traction. This administration being the Dennis Gartman of Politics, they have no problem whatsoever cutting losses ASAP and will gladly go wherever the market tells them.

What a waste of time debating a problem that amounts to "it costs too much."

Guy Adami said the market is undervaluing MHS. "I don't think it's priced right, I think it should trade higher," he said.

Snow has a bachelor's in science and econ from Bates College and a master's in health care administration from Duke. He joined Medco as CEO in 2003.

Pete Najarian discussed the impressive results of AstraZeneca's clot-fighting drug Brilinta against its chief rival. Najarian called study results "very, very comparable, maybe even better than Plavix." This Bloomberg story seems to indicate the results are better than comparable.

"They've got 140 different drugs presently in their pipeline," Najarian said of AZN. "This is a stock that has plenty of upside."

However, Pete said an "enormous number of puts" were being bought in BSX. He did mention WPI as his "Final Trade."

We haven't heard much from Joe Terranova in recent days that we consider highly quotable. One thing he did say Monday was that he found a price he liked in JPM. "I bought it today, 42.06 is your stop," he said. Of the broader market, he said to hang in there in September, then you'll see a "massive chase" for performance into year-end.

Guy Adami predicted the XHB is going to go down again after a huge run. But there was something besides MHS he actually liked: Dreamworks. He said he doesn't like recommending stocks at highs, but "Sometimes today's highs are tomorrow's lows."

Final Call, Halftime Report: Why
the TrimTabs report is irrelevant

You know what they say about poker — you can learn a lot from watching other players' faces once they get their cards.

Likewise, you can learn a lot about how seriously media professionals — people well-trained to evaluate whether news is significant — take certain subjects by the way they introduce them in their reports.

On Monday's "Fast Money Final Call," Scott Wapner asked Zach Karabell about insider transactions.

"Interesting fact I saw from TrimTabs," Wapner said, "in that the ratio of insider selling to buying was some- something astronomical, right, like 30 to 1 in the month of August. What does that tell us ... it certainly says that the people in the know seem to be selling stocks! So if you're an investor, what do you do?"

If this question had led off the segment, there might be reason to worry. Actually, Wapner began the interview by noting "semiconductor sales (are) up for the fifth month in a row." Then he said it feels like "real momentum" in tech given recent reports from Dell and others. Then he mentioned video game sales being down, then he asked Karabell about whether the Nasdaq's 100's 50%-or-so run since March was the sign of a bubble.

Eventually, we got to the TrimTabs report. This is the equivalent of newspapers running articles about supposedly promising cancer treatments that work in mice — which should either be on Page 1 or not run at all — at the bottom of Page 14 because editors don't really believe them but figure they belong there because the long shot potential is so startling.

Anyway, this was the highly expected response from Karabell:

"I'm not so fond of the people in the know these days, given how people in the know did over the past year. You know, they were, they were, buying up shares a year ago thinking that the market had dipped and would do well."

"I understand but 30 to 1 is a pretty big ratio," Wapner countered.

"Because they made a lot of money in the past year," Karabell responded, though we think he really means "since March" rather than "past year" or else it defeats his previous sentence. "So fair enough, they took their profits. I think a lot of us took some profits in the month of August. ... But I don't think that augurs some sort of 'Oh my God, you know, we're about to enter a retest of our March lows, or that the fundamental story is so broken. I mean look this is not a great economy, and it's not going to be a great economy, but it's a really good economy for global companies playing to strong aspects of global growth." (Translation: IBM)

Karabell recommended BRCM, ATHR and NVDA as semi names with a specific story. He didn't seem too concerned about a repeat of March 2000. (Unrelated, he recommended Charles Schwab on the "Halftime Report," which notably was not mentioned as a "Fast Money" sponsor after, you know, that Melissa Lee porn-documentary thing.)

Wapner asked about the Nasdaq 100, "The last time it had a six-month stretch like that was just before the tech bubble burst. How concerned do I need to be?"

"I don't think you have to be worried about a tech bubble, because we are still so far off of our lows," Karabell said. "We've got another decade or so before I think you've gotta worry about a tech bubble."

Perhaps Wapner's questions knocked Karabell off his game in the humor department:

"People assumed widely and I probably assumed, we'd have more of a summer pullback than we did," Karabell said. "So, you can't put a lot of stock — huh! pun intended — in uh, in these kind of motions."

On pullbacks, Karabell concluded, "I am among those who think you should be prepared to see one. I'm not so fond of trying to make an absolute market call because I think, given what's going on the past year, and the anomalies, that's almost impossible." But apparently not for Greg Troccoli.

Wapner continues to pack something of a punch in his "Final Call" segments. But don't tell Patty Edwards we said that.

Wapner could've noted the Shocker of the Day: Incredibly, AIG, Citi, Fannie, Freddie and CIT all went down. Someone investigate, the system must be rigged.

On the "Halftime Report," Melissa Lee — even though she looked great in black and chic belt — misquoted Dennis Gartman on the Chinese market.

"Dennis you're seeing a hundred-plus more days — down days, specifically.

"No no no, not a hundred-plus more down days; I wouldn't be surprised to see several more down days. I wouldn't be surprised to see several hundred points more on the downside. A hundred more down days, oh my word, that sounds like something Mao would've said."

Gartman said a correction in Shanghai should be expected. "This is not an institutional market ... The Chinese are notable gamblers," he said, but he noted that whenever Shanghai might fall 5% overnight, it's hard to imagine the rest of the world not also struggling.

"The mawket is no longer rallying on good news," Joe Terranova said. If that continues, "then the impending October correction will be coming." Jon Najarian slightly disagreed, saying money is coming into the U.S. market despite the Chinese crumble. "I see that as a positive, right here, in our markets. ... The Chinese market's down 22% in the month of August, we're up about 3 or 4% in the month of August." Karabell also agreed with Lee, contrary to a theme suggested recently by Mandy Drury, that the Chinese market should not be considered a barometer. "I will join you in the pooh-pooh chorus," Karabell said. "It is probably the only uncorrelated market — stock market — left in the world."

We've noted before how Mike Khouw tends to have trouble with decisiveness on the "Fast Money Halftime Report." Monday, he briefly discussed energy and said: "I probably have a slightly longer view, and, and my own, uh, longer-term view is actually fairly bullish remaining on the energy space in general and I still like some of the integrated names. So uh, I wouldn't necessarily be selling, but I'm not trading the oil markets specifically, I'm just taking a look at some of those stocks."

Got it.

" 'Longer term,' Mike, is till Friday?" Karabell asked.

"That's right, all the answers will be available then," Khouw responded.

[Friday, August 28, 2009]

Fast Money Review: Troccoli’s
quiet, under-the-radar GE call

Featuring: Greg Troccoli | General Electric | Goldman Sachs | Guy Adami | Paul Miller | WFC | AIG | C | FNM | FRE | MSFT | HPQ | DELL | BNI | PALM | Melissa Lee | Joe Terranova | Jon Najarian | Steve Grasso | AAPL | China | TIF | Laura Tyson | NOK | CBRL | Michael Woodhouse | SU | WFT | Pali | PSUN | John Paulson

Greg Troccoli apparently keeps his thoughts on CNBC's parent company a secret.

Troccoli Friday on "Fast Money" didn't have much to offer in the way of S&P forecasts ("the momentum, the bullishness is still there"), so he opted to tell us about a couple of Brag Trades.

Goldman Sachs, "I recommended it on November 21st, when it was trading down around 53, four days later it was 80 and it hasn't looked back," he said. (Actually, four days later it peaked at $74.50 and didn't hit $80 for a week, but who's counting?) If you're long it, "protect your profits" now, he said.

Here's where it gets interesting:

"We look at another recommendation that I put out on July 8. And that was General Electric," he said. "I recommended buying it at 10.75. I said it would go to 16, it's gotten up to 14.90. ... I would put a stop under 13."

Apparently this was an under-the-radar recommendation. Troccoli happened to appear on "Fast Money" on July 8 in a "weather forecast" segment that certainly looked prerecorded. According to the official "Fast Money" site as well as our own review, Troccoli said nothing about GE. He talked about the S&P 500, saying "close below 874, we have full rain conditions." He said gold is "cloudy" until it breaks out above $950 and said Treasurys will stop doing great if the S&P can hold at 874.

In fact, it was Guy Adami who said on the show July 8 that GE was worth around $12 or $12.50. "Anywhere around 10, you wanna get in GE," Adami said.

A day later, on the "Halftime Report" July 9, Troccoli said the S&P 874 level was "extremely significant" because the market had been hovering. "I'd like a few more days to hold that level before I become a buyer down here," he said.

So he was saying on TV that he needed "a few more days before" he'd become a buyer of the market, but off the air — and not listed with the show's official disclosures at CNBC.com — was telling people to buy CNBC's parent company at $10.75 because it would go to $16.

CNBC.com doesn't list any positions for Troccoli on those days, so it's unclear whether he actually has stock or option positions or whether he does not have said positions and merely recommends strategies to others. His bio at the Opalesque Web site doesn't explain either. It says he "holds the position of Executive Head of Sales for Structured Investment Management." It also says he "was solely responsible for publishing in-dept analysis..." (we think they mean "depth"). Strangely, some of the bio is in past tense.

This episode, on the heels of numerous other situations we've flagged this year where trader comments on the show don't match the online recap, is further evidence that "disclosures" at CNBC.com are basically worthless, the timing of the positions (according to the Web site, they could've sold before talking about it on the show, or could sell after the show airs) offers little clarity, sizes of positions are not disclosed so someone could own one share of Citi and apparently have it disclosed as a position, and whatever "Fast Money" is spending on the legal team that observes the show and puts the occasional disclosure tag on the bottom scroll is money down the drain.

Troccoli, we've noted before, is one of the show's better performers. Aside from the occasional Brag Trade, he's got a sense of humor, speaks clearly and gets to the point with specific calls.

But evidently not as specific as we thought.

Not to be outdone, Paul Miller of Friedman, Billings made a couple of jaw-dropping comments Friday on "Fast Money."

"You're not gonna see a reverse stock split in Fannie and Freddie," he said. "The issue is the government doesn't need it. The government doesn't want a lot of value here because the government knows that there's no value here at Fannie and Freddie."

So first, even though the government has a massive stake in these names, it "doesn't want a lot of value here."

Second, "the government knows that there's no value here."

So investors are actively buying — and buying up — shares of companies that the government "knows" have "no value," and the government is allowing this to happen unchecked.

Sounds like the government should be investigating ... itself.

We weren't the only ones dumbfounded.

"I didn't think what Mr. Miller, I mean, uh, I respect the guy, but I don't think his argument made sense as far as, 'Well the government doesn't care if the stock goes up'," said Jon Najarian. "The government owns 'em! What do you mean the government doesn't care?"

"There will be a lot of constituents out there who will be really angry with their congresspeople if ultimately these stocks go to zero when we poured all that money into it," agreed Melissa Lee.

Miller, who called himself "one of the big bears out there," insisted that for Fannie and Freddie, "there's just no value here," and "a lot" of the recent interest in the stock "is caused by the AIG type of situation." He said the reason the government hasn't fully digested the companies is because "They don't wanna put all that debt on the government's balance sheet."

Miller in April famously called WFC a short while Jeff Macke took the other side and Whitney Tilson disagreed.

Curious rationale aside, Miller is not alone. According to the official "Fast Money" site at CNBC.com, analyst Bose George of Keefe, Bruyette scoffed at the dash for trash, saying, "People have done well by trading them (in the short term), but when it gets to the end of the road, these stocks are going to be worth zero."

Saying a $50 stock such as AIG is "going to be worth zero"? One of the boldest short calls we've ever heard.

Guy Adami mostly deferred questions about the metoric rise of C and AIG. "The best bank trader for the last couple weeks has been Steve Grasso frankly. He's been all over it."

Grasso, who spoke recently of buying C at $4.05 and then buying more, offered, "Are they going to zero? Possibly. But when?" Melissa Lee questioned if it's completely short covering. "Oh, they're getting long the stock," Grasso insisted. He explained that "the stock becomes hard to borrow, then you have longs getting in."

Jon Najarian said, "There's rumors everywhere that Citi is going to do a 10-for-1 reverse stock split. If they do that, this is a $50 stock. That short squeeze that Mr. Grasso talked about all of a sudden becomes a monster — if you'll pardon the pun — of a short squeeze. It will. Because, again, AIG, it fell off a cliff after their reverse stock split, and then it went back to work, I think you see the same V in Citi."

Grasso said "there's no fundamentals to support it ... a long-term story, no, it's not that bullish."

Actually, give us a shot at this one.

We're not stock pros by any means. We'll just offer this: There are fundamentals behind all of this, because it's clear the government is not going to let any of the above (AIG, Citi, Fannie, Freddie) fail, and those businesses are going to "normalize" faster than people thought, and people have seen what happened to Bank of America since it was trading around $3 and want a little piece of the action.

Calling AIG at $50 actually "worth zero" has to be the prediction of the year, no matter how it turns out.

Really, the person we want to hear from regarding this subject is Karen. But she's on vacation. For a whole week.

Guy Adami added this: "You know what the FDIC though, again, you can't discount certain things, 416 banks now on the problem list in the second quarter. That's up from 305 in the first quarter, delinquent loans of 90 days or more up to a record 4.35 percent. You can choose not to listen to 'em, that's fine, or you can choose to look at that and say you know what, maybe things are a little bit scary in bank land, and get out. I would choose the latter."

Melissa Lee responded, "One could argue that too many bank charters were given out in the first place, and with the closing of some of these banks, that could benefit some of the other banks."

"You read that on the beach, didn't ya!" Adami said. "All I'm saying is, a lot of these stocks have had a monster run. Again, I think Wells Fargo goes lower, I think it trades down to 24."

Joe Terranova recalled government rules against short-selling and said maybe intervention like that is the reason stocks such as AIG could be posting unwarranted gains. "I want a short-squeezer investigation," he said/joked.

Melissa Lee, who somehow despite not being on vacation for a year was not even able to take a full week off and had to return for what usually is a slow Friday episode, mentioned spending vacation on the beach.

Unfortunately, even though she looked great on the set with straight hair and black dress, she did not supply viewers with a photo of herself in her swimsuit.

Steve Cortes was not around to carry the bear torch, so Guy Adami went that route mostly alone. "The market should've rallied strong today ... It didn't. Scares me," he said.

"I'd rather own Hewlett Packard over Dell here," he said. "But I wouldn't— I don't think you can really own anything at this point because I think the market's going lower."

"I think the BNI run is over," he said. "We're a little long in the tooth here."

Palm, he said, is in "no man's land."

He said TIF "was a $24 stock a month ago. $24 stock." He said it might continue to go up, but "It'll do it without us, or at least without me."

Steve Grasso said, "This rising tide is lifting everything ... the smart guys continue to buy it."

Joe Terranova said the week's activity is important because, "You have to look at this week as validating last week's price action." He declared, "When Goldman Sachs finally breaks down, that's when the market itself is also gonna break down." (The only problem is, that'll all probably happen at the same time.)

Normally a Laura Tyson appearance on "Fast Money" would top our day's review. Greg Troccoli and Paul Miller preempted that.

But to be honest, Tyson wasn't very exciting Friday anyway.

She defended the time-delay elements of the stimulus. "Right now we're at a point in time where we're getting the biggest effects. and uh, you know I think that's one of the reasons the economy is gonna be so strong in the second half of 2009," she said. "We have inventory rebuild going on, we have strong fiscal stimulus coming in, and we have the monetary authorities essentially standing pat on a very accommodative policy."

Then we got an extension of this sorry excuse used by White House advisers and officials a few months ago when there was talk of a second stimulus — the idea that somehow George Bush's administration hadn't provided them with enough information about the health of the economy.

Friday, Tyson said, "We really do have to get more information about how the economy is performing. And we just entered a period where it looks like we are beginning to recover. Let's get some more information from the real economy about what's happening."

The president not getting information? You've gotta be kidding. He eats with CEOs all the time. Jeff Immelt and Caterpillar CEO James Owens are on Obama's Economic Advisory Board with Tyson.

The translation of what Tyson said is really "let's not change anything until we start getting some bad data."

Joe Terranova, who is good at asking questions, tossed Tyson a doozie that she wasn't expecting, and we weren't expecting it either. "Don't you think it's time for Wall Street and Obama to bury the hatchet?" Terranova asked. "How come Obama has not come to Wall Street and visited us yet? And do you think he should."

Tyson, as she is prone to do, chuckled. (At least this time she wasn't laughing about the stimulus.) "I did not know there was a hatchet. I, uh, am involved in Wall Street, and I certainly would not say there was a hatchet. ... We have brought private capital back into the market. ... Maybe we should just examine whether there's a hatchet or not."

"There clearly has been a problem between Wall Street and President Obama's administration," Terranova said. "That is what it is."

Maybe so. But the image of Obama coming to "visit" people on Wall Street is rather ludicrous. Isn't the reappointment of Bush's guy (Bernanke) enough concession of sorts that the country's problems maybe weren't all stemming from eight years of failed policies of George Bush?

One thing Melissa Lee wasn't doing on vacation was preparing for her Friday guests. (We know that she was at the beach, even though she didn't offer viewers the courtesy of a bikini photo.)

Michael Woodhouse, CEO and overall chieftain of Cracker Barrel restaurants, came on the show and discussed expansion. "We're only gonna open seven stores next year," he said, saying "in this environment, we've gotta be cautious," and the "new stores next year are gonna be in fairly traditional cracker barrel sites."

Lee asked, "Where will you be opening these new stores? Are you going to go out of, sort of, the I-95 corridor that you have been in?"

We knew that didn't sound completely right.

"Well, we're in a lot of corridors, we're in a lot of interstates, that's really the history of the company," Woodhouse said.

Basically if you've done a driving vacation east of Denver, you've probably seen a sign for a Cracker Barrel somewhere. But don't take it from us, take it from the company's Web site, which, had Lee only looked at it for about two minutes, would've prevented her embarrassing suggestion that the company only operates along I-95. The company has about 50 locations in Tennessee, 20 or 30 in Texas, Illinois, Ohio, North Carolina, and it is opening new stores in the next two months in Texas, North Carolina and Kentucky.

Guy Adami was actually semi-bullish on CBRL. "Benign tape, I think this stock can continue to go higher," he said.

Woodhouse, by the way, majored in physics and earned a bachelor's and master's in natural sciences from Queens’ College in Cambridge, England. He joined Cracker Barrel in 1995 after previously working for TGI Friday's, among other places.

When it came to a prominent tech pick, it was time to hit control-alt-delete.

Three weeks ago, Friday, Aug. 7, Joe Terranova said, "You can Fast Fire me every week; I'm not getting out of Microsoft."

Today, Terranova said, "If you look at the price action today in Microsoft, it was so discouraging that I actually got out of my long position. ... The tape tells me what to do right now."

Jon Najarian said even though things look good now for technology, "The upgrade cycle is still several months out into the future." Terranova, while ditching MSFT, said "I got long Apple today," citing in part Dr. J's rationale yesterday for Apple's potential in China.

Melissa Lee asked why Apple would be able to do better than Nokia in China when Nokia already has brand recognition. " 'Cause Nokia doesn't make any money on their damn phones. That's why," Najarian said.

Terranova said "I am long Suncor, I'm long Weatherford." He returned to a recent "Fast Money" subject. "Who's the best commodities trader right now in 2009? The Chinese government. Absolutely."

Guy Adami said people need to take reports of John Paulson and other "whale" purchases with "a grain of salt" because no one knows if they still have those positions or how they've hedged them. Melissa Lee insisted "we talk about that" all the time on the show, but in fact they don't always, and if so, why bother to make such a big deal about the whales anyway?

Adami says he respects Pali Capital and thus you might want to look at PSUN.

[Thursday, August 27, 2009]

Fast Money Review: Why isn’t
Bob Pisani the guest host?

Featuring: Rick Santelli | Bob Pisani | AIG | Steve Cortes | Guy Adami | Pete Najarian | Joe Terranova | XLB | PHO | VE | China | SPY | TLT | EMN | HPQ | DELL | MSFT | ERTS | Shane Kim | COL | Andrew Hall | C | Phibro | Charles Gasparino | Stephen Luczo | STX | AAPL | Jon Najarian

"Fast Money" gave viewers four days of Rick Santelli this week, and about four minutes of Bob Pisani.

Anyone know why it wasn't the other way around?

But more on that below.

There's no shame in being wrong.

But don't you wish the folks on "Fast Money" had persuaded you to buy AIG a few weeks ago rather than universally condemning it?

Yeah, (sigh), we know ... sometime in the next couple weeks, the Chinese market will implode overnight, the S&P will drop about 100 points or more, the "new normal" will set in, Wal-Mart will kick everyone's butt, etc.

Meanwhile, AIG goes up about $79 a day. (OK, that's an exaggeration, but...)

Thursday, up $10 to $47.84, marking a 50% gain in a week.

To recap: In July, Adami called the AIG reverse split "sort of the death knell," Tim Seymour deemed it a "sign of weakness," Pete Najarian declared we'll see the stock "in the pennies again," and Jared Levy recommended the $12 puts in February.

Before that, Guy Adami famously scoffed at Dick Bove's prediction that Citigroup, then just over $3, would eventually get to $12.

The show's name is "Fast Money" — how about some trades that work now, not maybe 10 years from now.

Apparently we're not the only ones noticing. Steve Cortes reported Thursday that even his mother is tired of Steve and the "Italian" guy sounding like "grumpy old men" every day. Hey, we don't care if you're bullish or bearish ... how about just being right?

Cortes said he sees a negative in Thursday's markets in that his two favorite targets apparently underperformed. "China lagged ... Nasdaq lagged," he noted. He recalled his short-XLB trade that he admits he hasn't put on yet, which was good because it "would've been a loser today," but says we're getting closer to it. (What was that old saw about "trading the market you've got, not the market you want"?)

Yes, the show is called "Fast Money," but instead of other hotter commodities or materials, Cortes touted water names PHO, VE because they represent a "secular play that can last for years."

Cortes called the Treasury bond auctions "astounding ... staggering." He predicted the SPY and TLT "will meet in price ... probably just below $100."

Bob Pisani made a rare "Fast Money" appearance (maybe that's a trend this week with Larry Kudlow doing a guest spot; could Joe Kernen be in the pipeline?) on Thursday. He waved his arms around way too much, but his zeal for the markets was entertaining, maybe too entertaining (more on that below). We're sure a couple of the panelists took note of this comment: "The trend has been up. Anybody who fights that is, is crazy at this point."

Guy Adami wasn't fighting much of anything Thursday except a pay cap for Andrew Hall (see below). Instead, Adami was actually finding some stocks to be bullish on.

"I love EMN," he said. He also pointed to COL, noting Rockwell Collins CEO Clay Jones was on the show recently and "said great things," except Jones really didn't have much to say because the segment was cut short. Adami did say he thinks the DELL trade is about over and MSFT, "around here it's probably dead money." But he thinks HPQ is not so bad and that ERTS is a superior video game trade than MSFT, perhaps because someone will buy it.

Microsoft was in the news for the Xbox price cut, which landed "Fast Money" a damage-control interview with MSFT VP Shane Kim, who had nothing but corp-speak to offer. "We wanted to provide more value to our customers," he said.

Charles Gasparino took up the Andrew Hall/Citi/Phibro fiasco and discussed how "pay czar" Ken Feinberg is digging into this. "There's a very good likelihood that this thing is gonna be spun off, so, uh, you know, they don't have to deal with this anymore," he said. Guy Adami ranted and raved about people being criticized simply for wanting to be paid for making money for their firm. "There is no solution to this story," Gasparino agreed.

Steve Cortes asked about the future of Vikram Pandit. "I go back and forth on this," Gasparino said, noting that Pandit, in his efforts to unwind the behemoth that used to be Citigroup, overlooked Phibro as an asset he might want to unload. Nevertheless, "Layin' that one on him is a little too much."

Pete Najarian, who is rapidly emerging as the "Fast Money" trader of the year despite not pushing anything extraordinary, has smartly avoided clinging to macro calls that have proven irrelevant to stocks this spring and summer. Thursday he said of AIG and the "dash for trash," "They might be trash, but you're getting your beta."

Pete suggested Seagate Chairman & CEO Stephen Luczo's purchase of 100,000 shares might be a bullish sign, except we've come to believe that's a horrid indicator, given that we're among those who bought a few shares of Chesapeake last year right along with Aubrey McClendon and did the same follow-the-leader with SandRidge's Tom Ward, another exec singled out by Najarian a year ago.

Pete also said Goldman Sachs elevated three sectors, coal, oil and chemicals, to "attractive." (This writer is long ANR.)

Pete's brother Jon made a late appearance to talk about iPhone potential in China. (Steve Cortes was given no chance to rebut, but in case you missed it, the Chinese stock market is lagging and turned down before the U.S. did and look out below.) Jon Najarian said "the Chinese people are very brand-conscious" and hold prestigious international companies in high regard, and he predicted the iPhone would do very well there. He started to explain why China Unicom would be the play on this before the segment kind of abruptly came to a close, though someone noted that AT&T was supposedly going to be a big winner on the iPhone play when in fact the trade is to continue owning AAPL.

Joe Terranova talked about one of his favorite subjects this way: "Oil market dips, you buy it. ... You're seeing the contango come out of the market."

Terranova said Electronic Arts "is a buy if they come out with a 'Fast Money' video game." Um, no thanks.

We were surprised to hear that Melissa Lee apparently won't even take a full week of vacation but will return Friday. How to describe the four-day week of Rick Santelli?

Clearly, hosting an hourlong show is a different operation than opining a few times a day from the pits. Santelli was very raw in his timing and relied way too much on the script. This isn't his thing. CNBC should've given Bob Pisani a shot at this; Pisani seems like an excellent choice; he's well aware of all the day's stock activity, he's very comfortable interviewing people about stock movements and pushing for specifics, and doesn't mind adding an editorial comment here and there.

The obvious answer for this casting decision is the perception that Santelli is someone with "traction" and built-in viewers, while nobody watches the channel to see Pisani. That's the wrong mentality here. "Fast Money" needs a traffic cop, not an accidental pundit who is going to be talking about tea bags for 10 years. This is one trade that needs to unwind.

[Wednesday, August 26, 2009]

Fast Money Review: Is China
a better oil trader than U.S.?

Featuring: Steve Cortes | Joe Terranova | Rick Santelli | Guy Adami | Pete Najarian | Bill Fleckenstein | gold | silver | Maynard Um | DELL | PALM | WFT | SU | XOM | Gary Kaminsky | C | BAC | XLB | GS | JPM | BKE | Greg Troccoli | FXB

Curiously, there was no "Fast Money" commentary Wednesday on health-care legislation in the wake of Ted Kennedy's death, even though Karen Finerman suggested Aug. 11 (see below) that such an event could prove decisive.

Finerman this week happens to be on vacation.

However, we did get a dandy little discussion of China on Wednesday. Unfortunately, once again, the show's leading expert on China, Zach Karabell, was not around.

(Note: Tim Seymour is undoubtedly an expert on China also, but given that Karabell has a book in the pipeline and writes about the subject frequently for WSJ, Newsweek, etc., we're giving him the nod for now.)

Steve Cortes was first to take the plunge. Regular viewers already know where he stands. He declared, "This idea ... that Beijing can be this omniscient, uh, architect of an entire nation's economy to me is somewhat ludicrous."

"China is tightening, de facto," Cortes said. "Central command does not work."

Guy Adami said "it wouldn't surpise me at all" to have a day when the Chinese stock market is down 8% to 10% overnight. "I think that day is coming frankly," he said.

Joe Terranova said to forget the Chinese stock market. "We are talking about economy," he said. "How come when oil pulled back to 40 bucks, the United States was not a buyer? We were not filling our SPI. I'll tell you what — China was doing it. They were taking the opportunity at lower prices to stock commodities..."

On every corner," said Rick Santelli.

"Every corner," Terranova agreed.

On every corner," Santelli repeated.

"China basically has us in the position that they want economically," Terranova continued. "They will squeeze commodities higher."

"Joe, I have to take the other side of that," Cortes said. "Do you really believe that a command economy can overcome American entrepreneurship and innovation?"

"No," Santelli interrupted, "but during a time when you need to stockpile..." he said, going off on a tangent on solar, windmills and alternative energy, saying it's "great 10-15 years down the road. We have boatloads of natural gas, what's the price ..."

Then Santelli offered this head-scratcher: "See, sometimes central command is better because of the political inefficiences of bureaucracies, but we are capital market guys."

Which is apparently one way of saying, China doesn't mess around with windmills.

Terranova was even in clapping mode. "You have to applaud the Chinese for recognizing when commodity prices got so low in February and March, they stepped in, they were buyers, and you know what, they were right. They weren't like the United States who a couple of years ago, as oil was going to $140, the United States was buying it at 120."

Another reason to dislike our government: It's not a good enough oil trader.

We keep saying here that the market will top once "Fast Money" stops running its "Bull Market or BS?" segment, or at least finds someone to take the "Bull Market" side, which we're not sure has ever happened, despite stocks being up about 7,000% since March.

Gary Kaminsky took a spin at it Wednesday.

"You're in a relative performance game right now, which I think is very dangerous," he cautioned, saying money managers are fueling the dash for trash by believing "we have to own these names" and creating "closet indexes" in chasing hot performers, "basically doing the same thing they did in '99," and we know how well that turned out. He said he bought C and BAC a while back, but now, "I wanna be very concerned, very cautious."

Steve Cortes asked when we'll know the dash for trash is over and crumbling. "As soon as it becomes apparent to market participants that the economy is not gonna grow, is not gonna have any real growth in the first quarter of next year," Kaminsky said, so it's basically an opinion that the economic consensus is off.

Joe Terranova pointed to 2010 as the end of this. "Asset allocation stops when you turn the page on the calendar," he said.

Cortes wasn't nearly so cavalier. "The game of chasing performance is incredibly dangerous," he said, and the ending is a lot closer than Terranova thinks. "My guess is, it's not at the end of the year. ... I think it's next week. I think we are, we're very, very close."

Maybe all the White House needs to do is cut capital gains. Cortes said this post-recession recovery will struggle because in 2003 — and this is the second day he's mentioned it — "the fuel that really got that rally going was the Bush capital gains tax cuts."

If Cortes and Adami have been leaving you with the impression the S&P is about to drop 100 points, you're not alone. Cortes declared that the "leaders of the bulls army have been shot." He then re-explained his months-long thesis, which is also "Pimco's thesis that they've been promulgating," (we included that because that's the second time he's mentioned the thesis Pimco is "promulgating"), that the "consumer is in for years of restraint."

Our take? Cortes is a lot more educated on these matters than CNBCfix, but the idea of American consumers restraining themselves for anything more than, oh, a few days, a few weeks, maybe a few months in some cases died around the time President Carter was calling for sacrifice while wearing a sweater in the Oval Office.

Rick Santelli opened the show with a dreadful cliche — "deja vu all over again" — and Pete Najarian noted it was almost impossible to draw conclusions from Wednesday's market because of remarkably low volume, particularly in options. "Today, we barely broke 10 million," he said.

Adami said "clearly the market's got me perplexed," and that recent comments from China, Meredith Whitney and Mohamed El-Erian were very negative but not being regarded as they should. Then he pointed to Hartford Financial around $23, "may still go higher, but I'd be taking profits."

Joe Terranova was not so pessimistic. A lot of people say "the correction is coming," he said, but "be careful." He pointed to three reports coming out next week, ISM, FOMC minutes and "unemployment on Friday." He said "all three of those set up potentially to be very positive reports," leading to a rally into year-end.

"I bought Exxonmobil, I bought Suncor, I bought Weatherford," Terranova said. But then, continuing his daily roller coaster of oil opinions, added, "Oil is not a commodity that you can pick a top in."

Cortes said "Selling XLB makes a lot of sense here" and offered an "Odd Couple trade," which is just the basic pairs trade that "Fast Money" always tries to suggest is such a unique way of managing money. Cortes owns GS and doesn't want to sell it. "I sold today JPMorgan against Goldman Sachs," he said. Adami said, "I'd rather be short JPM outright" and buy Goldman at a lower price.

Bill Fleckenstein for some reason has made two appearances in less than a week. Rick Santelli sensed some Fed gripes coming, so he pointedly asked Fleck, "Tell me a trade to make money."

"I'm a big fan of yours," Fleck said, and before giving us a trade that makes money, he added, "Nobody believes in central planning, but everyone believes in the Fed which is just central planning about printing green pieces of paper." But there is a trade: "I'm long gold, I'm long silver, I'm long gold and silver mining stocks." But when Guy Adami asked about stock direction, he said he is "kind of agnostic ... I'm long money-printing and I don't care about stocks."

UBS analyst Maynard Um talked about Dell and said "I'm not a buyer here." Um did fine, but honestly, it wasn't a very interesting segment about a stock that really hasn't been interesting for about 10 years. "I still anticipate more gross margin pressure," Um added. Pete Najarian asked what it would take to make him more positive. "I think they have to do a transformational acquisition," Um said, singling out Perot Systems. "I'd like to see them do something on the M&A front."

"Let's not beat around the bush, the name is PALM," said Guy Adami.

"I don't think that's actually a good acquisition," Um said. "I don't think it adds any value to them."

Greg Troccoli delivered one of his weakest weather forecasting segments in recent memory. He said the "1123 area is very critical" and that the risk area would range from S&P 1,040 to 1,090. But he's not throwing in the towel by any means. "For me to try to sell into strength would be a futile endeavor right now," he said. "We are in summer markets right now, this week, next week ... obviously we're overbought, I just don't see that we're extremely overbought," he said.

For a "Final Trade," Terranova wished Karen Finerman and Tim Seymour a happy vacation and offered BKE, saying "I don't know about K-Fine, but I know The Ambassador's shopping there right now." Cortes said "I am short the British pound."

[Tuesday, August 25, 2009]

Fast Money Review: Bush guru
decries expansion of government

Featuring: Edward Lazear | Rick Santelli | Guy Adami | Pete Najarian | Joe Terranova | Steve Cortes | OIH | AAPL | BNI | NSC | GS | Howard Dean | HOC | SUN | TEVA | IPSU | CCL | WYNN | LVS | AMR | swine flu | Dani Hughes | Christopher Zook | Lloyd Blankfein

Celebrated economist Edward Lazear said something Tuesday on "Fast Money" we could barely believe.

"The problem is the huge expansion in the size of the government, and that's going to be the major problem the economy faces in the long run."

The chief economic adviser to George W. Bush says the problem is the "huge expansion in the size of government."

Is this for real?

"Either we're going to have to tax our way out of it, we're going to have to inflate our way out of it, or we're going to borrow, uh, and then eventually have to tax or inflate our way out of it," Lazear said.

And remember when Larry Lindsey got the boot for publicly estimating the cost of the Iraq war between $100 billion and $200 billion?

Yeesh.

Despite misgivings on the size of government, Lazear nevertheless endorsed the architect of recent monetary policy, recently reappointed Ben Bernanke. "I think it's a good move for two reasons," Lazear said, because Bernanke is a "very capable economist ... but more importantly, he's been there," and the Federal Reserve in the last 12 months "got it right."

Steve Cortes, always highly prepared, extended the discussion by saying "government policy really matters to markets." He cited two examples, steel tariffs in March 2002 and capital gains tax cuts in May 2003. Gut feeling here? That's a reach.

Guy Adami said of Lazear, "he's probably spot on." And on a day where Adami sounded ready to recommend shorting the Yankees, he even took the opportunity to suggest Lazear's long-term warning as a short-term sell signal. (We don't necessarily disagree with the frequent "down the road we're in big trouble" theories heard on CNBC, but we gotta wonder why so many people with money apparently aren't buying it, sending the S&P up about 5,000 points in five months.)

"It's a fine line, right," between admitting you're wrong and sticking to your guns, Adami said. "I've been wrong, but now I'm sticking to my guns. I think we're heading a lot lower this week, maybe next week."

"People are getting a little too complacent," he added.

According to Adami, when it comes to shorting stocks in this market, it's not a question of where to start, but where to stop.

J. Crew "might be the one," he said, but only after earnings. And, "oil services names may be shorts as well. ... I think the OIH is in for a big move down." He dislikes BNI, "nice run, think it's over," even though Pete Najarian likes NSC. And because mighty AAPL tends to trade with the S&P, he said "I think Apple's a short here."

And he's shorting people with bad health habits too. "A lot of this (push for health care reform) is people getting sick because of their lifestyle," he said.

He does, though, actually like Gilead.

And Lloyd Blankfein. And Lloyd Blankfein's firm. "Leave the guys alone," he said. "I know Lloyd Blankfein personally," he added, and said Blankfein wouldn't stand for things being alleged about Goldman Sachs in some quarters.

Then he said this about Goldman and the TARP: "They never wanted that money, frankly." He said Goldman's most dangerous moments were around the time it converted to a bank holding company, when $5 puts were trading, and if critics want to single that out, fine. (He didn't mention that Goldman also got an indirect bailout via AIG, something it didn't exactly refuse.)

It's time for some straight talk on Rick Santelli, guest-hosting for a second straight day.

We've been speculating if Santelli was given this job to boost the exposure of himself ... or "Fast Money," in other words, does he need the show or does the show need him.

He is clearly not a natural at this type of work and needs polish. He tends to work from the script and either inadvertently cuts people off or doesn't interrupt them when he should. He also leads the league in posing and changing his expression for the camera.

He "introduced" Lazear by failing to mention his name other than saying Hi, Ed.

On the other hand, there are positives too. He brings a healthy enthusiasm to the set. And those who can't stand him for the famous rant might be satisfied that his turn on "Fast Money" has been low-key and mostly nonpolitical.

Former presidential candidate Howard Dean came on for a "Street Fight" of sorts with Santelli and apparently the others, but it was among the more genteel debates on CNBC, to the point Dean seemed to lament the lack of shouting.

Dean said a couple of interesting things. There is "no provision to allow immigrants, uh, to be, to be insured. None. Zero," he said, and one wonders what definition he means for "immigrant." He used the term "undocumented," so presumably he means illegal immigrants, but there are plenty of distinctions, green cards, etc., and then Dean said if it were up to him personally he would insure the kids anyway. So if there's an undocumented family, the 7-year-old's sick and is covered on the health plan, the dad has to go to the emergency room on the non-plan, evidently.

Guy Adami said he's fine with the "kum bah ya," but who's going to pay for this. Dean said that funding would be helped by "squishing down the costs."

Pete Najarian said there is a trade to be found here in TEVA (not a surprise). Then he took serious issue with Joe Terranova's comments on the swine flu estimates. "A lot of that's very unrealistic," Najarian said. "Let's not blow this out of proportion."

Terranova said swine flu is a reason he's "bought some puts in Carnival Cruise Lines," and Steve Cortes reiterated his point from yesterday that he thinks travel names are a short, such as WYNN, LVS, AMR.

Terranova had new trades going all over the place. He said for hurricane season you might want to try refiners "away from the gulf" such as HOC and SUN. He touted IPSU as his "Final Trade." He now says of oil, a day after saying oil is going higher, "that market is topped out." And he said he thinks data will confirm the "housing bubble unwind has reached the bottom."

The latter comment was challenged by Steve Cortes, who asked a question in response that Santelli didn't allow to be answered. Cortes also talked of a disconnect between homebuilders and wood. "Lumber is going all the way back to the March lows," he said. "I honestly don't really get this discrepancy." Cortes also said there were two warning signs for oil: the dollar movement didn't match oil's decline, and Chinese demand isn't supportive of the price.

Pete Najarian offered KLAC as his "Final Trade."

Danielle "Dani" Hughes of Divine Capital turned up on the "Halftime Report." She said "there's been a lot of chasing" in the markets and that we've seen some "panic buying" in specialty retail stocks. "Can you tell by my hands, I'm a trader?" she asked.

"Still a lot of cash on the sidelines," said Christopher Zook.

[Monday, August 24, 2009]

Fast Money Review: So that’s
why Goldman has a PR problem

Featuring: Goldman Sachs | Rick Santelli | Charles Ellis | Charles Gasparino | Steve Cortes | Jon Najarian | Joe Terranova | Pete Najarian | BTU | CNX | WLT | SHLD | FXY | MA | JOYG | NVLS | Mike Khouw | Jared Levy | Zachary Karabell | IBM | "Kill Bill"

If ever a CNBC segment screamed out for Charles Gasparino, this was it.

But Gasparino was nowhere to be found Monday on the "Fast Money" set.

The subject was the image of Goldman Sachs. Wouldn't it make sense to bring on the reporter who broke the story on Friday that GS is seeking a brand manager?

Instead, guest host Rick Santelli introduced Charles Ellis, who wrote the 2008 book The Partnership: The Making of Goldman Sachs. Ellis was either not expecting, or not prepared, to discuss Goldman-bashing and Goldman conspiracy theories. This segment was mostly a train wreck. Santelli told a story that initially sounded interesting, something about a friend who worked at an unnamed investment bank who somehow was always on the wrong end of every floor trade. Then the friend went to apparently another investment bank and had a killer year ... or it was a different guy, we kind of got lost, and never was the name Goldman brought up, so what the heck was the point, who knows. Apparently the implication is that the guy did not work for Goldman, every trade was a loser, then after that experience somehow he was deemed qualified to join Goldman, and every trade became a winner.

Santelli concluded this story by asking Ellis, "Give us some, some color on Goldman Sachs."

Color on Goldman Sachs? What the heck does that mean?

Ellis, who was holding either a clipboard or notepad, didn't know what Santelli meant either. "That is a very compli— fast question," he said. (Editor's note: It wasn't a "fast" question, but a "bad" question.) Ellis went on to say of Goldman's success, "It's about people," and "discipline, discipline, discipline. ... Honest to God, it's the culture."

Extending this segment, which was quickly going nowhere, Steve Cortes (who said he is long GS) complained about the criticism of Goldman and said, "Personally I think it's very unfair." Ellis said the criticism/conspiracy theories are very creative. Jon Najarian then said Goldman Sachs has a "great culture," and he is not sucking up to them any more than he would be sucking up to Tom Brady for calling him a great QB. "Bill Belichick has a great culture," Dr. J said.

The funny thing about that, the Patriots essentially admitted cheating a couple years ago, lost a No. 1 draft pick and the coach paid a big fine. And their "great culture" hasn't won the Super Bowl for four years running. Maybe the Patriots need a bailout.

And maybe the good people at GS would prefer a different sports comparison.

So, the sum total of this fairly long segment was to tell people that Goldman Sachs has a "great culture." Unlike Santelli, we spent a few moments — only a few moments, really, but it would be enough to ask Ellis some legitimate questions — actually doing research on a "Fast Money" guest.

We found, in the New York Times review of The Partnership by George Anders posted in April, some interesting material. Namely, that Goldman at least in its earlier years sought to hire individuals from "working-class backgrounds" under the theory they would work hardest to transcend the financial/social status they inherited. At some point top management divided many responsibilities, limiting risk that one executive's blunder could sting the firm. Executives would be wedded to the firm, keeping their wealth tied up in it, which made for quality long-term decisions while spouses and children paid the price. Modesty was important; GS nearly hired Michael Milken but his demands were deemed too greedy. Goldman, according to Ellis, was mostly out of risky housing instruments by April 2007. And, Anders' review notes, Goldman executives are well aware of a tax situation in which wealthy government appointees can avoid capital gains taxes on their holdings by transferring them to a blind trust. According to Anders, Ellis writes that Hank Paulson might've saved $200 million this way, a suggestion that public service might indeed have some financial benefits.

On the Amazon.com reviews page, we found a broad sampling for Ellis' book, including this: "gripping story ... lousy editing ... incredible repetition ... glowing and comprehensive history ... substantive yet engaging style ... honest look at some of Goldman Sachs' missteps..."

If you ever want to get into an Ivy League bragging contest with Charley Ellis, come prepared. Ellis, according to the Yale School of Management Web site, is a graduate of Exeter and Yale College, has an MBA with distinction from Harvard Business School, Ph.D from NYU, 20 years on faculty of Investment Workshop at Princeton and appointments to Harvard Business School and Yale School of Management. And he is "married to his best friend," Linda Koch Lorimer.

Ellis uses lofty terms like "great culture" and "discipline." We'll keep it simple. Goldman historically made more money per partner than other firms. That attracted the top new recruits, who kept it atop the leaderboard.

It is fascinating that Goldman Sachs is regarded by "Fast Money" types as an invincible financial machine, guys who have it all "figured out" according to Steve Grasso last week.

Gasparino wrote in the Daily Beast in July that Goldman Sachs "needed a government bailout to stay afloat" and was otherwise "toast, finished, kaput." Assuming that is true — and while we haven't heard Goldman Sachs acknowledge this, we also haven't heard anyone doubt it and we see no reason to doubt it either — then how is Goldman Sachs any better than an airline, General Motors or Bank of America, needing government help and a cash infusion to survive. Goldman chose a business model that in autumn of 2008 absolutely did not work and pretty much guaranteed ruination.

Yet these guys have it "figured out."

Conspiracy talk should be framed in a "Survivor"-esque discussion. Most big-business failures take years or decades to occur. The scenario that suddenly materialized in 2008 was that investment banks that were actually profitable in recent years or even quarters were suddenly going to start failing. There were five major ones on Wall Street. None had immunity. According to our interpretation of what Gasparino wrote, none of them would've survived with zero government intervention. But government intervention did happen, very selectively, so survival was indeed possible. That survival hinged apparently on two major factors, being "too big to fail" or being deleveraged. The government voted Lehman off the island and more or less did the same with Bear and Merrill. Then it stopped voting. By the evidence available, Goldman Sachs and Morgan Stanley were stronger than the other three. In a five-team tournament, they were 1 and 2. That is the strongest argument — not the only argument, but strongest — as to why they survive to this day. And thus GS becomes the Battlestar Galactica of high finance.

The conspiracy argument, or at least one of them, is that Goldman used unethical government connections to game the system for its survival. There is a sound argument against this theory, an argument cited by Gasparino and others, that the government was not going to let all of the major investment banks fail, no matter who they were. Those who doubt this should note that airlines were shielded after 9/11, that Chrysler has been bailed out twice, that General Motors was bailed out this year. (Note: This writer has not read the Matt Taibbi article in Rolling Stone and has no opinion on it.)

Given the hype preceding Rick Santelli's turn as guest host this week, one would have to conclude Monday's "Fast Money" was a massive underachiever.

The show opened in horribly dull ground, Pete Najarian talking up — and of course you'll be stunned to hear this — the VIX again. Pete said something about 16 points per day and 35 points per week and that overall the VIX "makes sense at 25."

There, aren't you glad you know that?

Santelli lamented, "I can't give you a directional volatility trade anymore." (Note: He might've said "trend" and not "trade," we're not totally sure.)

Man, a "Fast Money" without a directional volatility trade. How will we ever cope?

Steve Cortes brought some life to the program. Cortes' thesis this summer — the "new normal" of a distressed consumer being a serious headwind on growth, a view shared somewhat by Patty Edwards — has so far proved mostly a bust. That doesn't mean he can't be right in the future.

What Cortes is good at is identifying specific trades, and often, and expressing them on the show.

"I think the Treasury market is telling us that there is perhaps trouble ahead," he said. "I am short the Nasdaq against the S&P," he said, a position he echoed in his "Final Trade." Interestingly, he offered this as his rationale: "The fundamental background here is this ... tech is too crowded, it is too popular a trade."

Is that really a "fundamental" reason for a position? Sounds more "technical" ... or even, ahem, "emotional" to us.

Cortes challenged his colleagues with intriguing, professional questions and demonstrated that he and not Santelli should be hosting this week. He pointed to the Chinese stock market troubles and asked Joe Terranova who in China is going to be buying all this copper and oil, a question better left to Zachary Karabell (see below). Cortes also said, "I'm actually considering shorting airlines," based on price action and swine flu. He said "I wanna be long Treasurys."

The latter comment came at the end of a discussion with Larry Kudlow, making a very rare "Fast Money" appearance. We like Larry Kudlow as much as the next person. However, there wasn't much of a trade here, to say the least, but rather an additional five minutes of "The Kudlow Report" in which Larry tells you that things are looking up and he's tired of gloom-and-doom mongers who keep warning of inflation and deflation and other bad stuff and can't we just give ourselves six months of enjoying things before worrying about the next crisis. Oh, and there are indicators that concern him but in general as long as the government keeps out of it everything will be OK. "I'd be short Treasury bonds," Kudlow said, an affirmative answer to a question from (who else?) Cortes.

Pete Najarian pounded the table for coal. (This writer became long ANR on Monday before the show aired.) Najarian touted Peabody (BTU) as his top pick, and added Consol (CNX), and later Walter Industries (WLT) because of its "incredible chart." He said investors are looking at "metallurgical, over those that are the thermal coals."

Pete and brother Jon Najarian conducted a staged debate over Sears Holdings. Pete was listed as a former Tampa Bay Buccaneer (true) while Jon was listed as a former Chicago Bear (um, not quite so true, uh, well, but we've been down that road...). Dr. J took the bullish approach because of Sears' hedge fund element and the skills of Eddie Lampert (which Dr. J pronounced as "Lambert"). "Barron's is wrong," he said, and he predicted it wouldn't reach the low $50s. Pete pointed to SHLD's woeful earnings and said as retailers, "they can't seem to do anything right."

Dr. J said for a "Final Trade" there was interesting activity in Novellus. Pete pointed to JOYG again.

Joe Terranova said the market's price action Monday gave you a great "tell" as to where the risk is, mentioning Mastercard. "I shorted that name today," he said. He said it's time, and has been time for a while, to move to the "sidelines" on F. He also said he's short SHLD and wouldn't mind if it goes to $35. He does, however, like the FXY.

Terranova, the guy who just recently called a double-top in oil, appeared on the "Fast Money Halftime Report" and declared "oil is clearly going higher." (Note: We don't have a problem with a guy changing his mind based on a new tape, but Terranova sometimes seems like a guy who's swinging after the ball is already in the catcher's mitt. "I like the rails," Terranova also said.

There were a couple moments on the "Halftime Report" that illustrated just how difficult it is for Mike Khouw to make a call.

First, Jared Levy said, "If you look at that S&P right now we're approaching that upper Bollinger band. ... I'm a little worried we're a little overbought here, and I think we see a correction, at least in the next day or two."

Zach Karabell, making a welcome return appearance, didn't take issue with that short-term call but said, "From a trading perspective there's no reason why this can't continue to go up, in a really, uh, atypical fashion because it's coming on the heels of a really atypical year."

Khouw apparently managed to agree with both. "I definitely see what Jared's talking about," he said. But, "To Zach's point I sort of think that, that might be a false expectation, you sit there and everybody's expecting, that might be a good reason why we wouldn't see one." (We think he means correction, which would negate Levy's point.)

Later, Khouw was asked whether he would buy or sell into the market close, a determination that is basically in the job description of anyone appearing on the "Halftime Report."

"I'd have to flip a coin," Khouw said.

Karabell, who has a provocative new article in Newsweek explaining how IBM is emblematic of the new global economy (unfortunately, the headline writers at Newsweek gave us at best mixed signals and at worst an outright misinterpretation of the point of the article ... also while mentioning IBM's recent successes the article does not note that IBM should've secured Microsoft's job about 25 years ago, a serious miscalculation, but then again, if it had, it would've gotten too strong and just fallen under government scrutiny and eventually broken up anyway), got our attention with a comment on one of our favorite recent subjects — the possibility of a permanent oil headwind on the consumer.

Joe Terranova actually raised the issue of the link between high oil and consumer spending, calling it a hotly debated "Fast Money" subject when in our opinion it really isn't. Karabell said this is a topic "endlessly debated" and studied, with numerous models drawn up, but "those correlations have never panned out."

We're no experts on this, just interested parties. Larry Kudlow used to say for the last couple of years that gasoline is a much smaller percentage of a typical family's spending than it was in 1974.

We don't know. We do know that the '80s and '90s were great for investors and oil was coincidentally a lot lower (inflation-wise) than in the '70s and '00s.

Karabell added, "You know, in the commodity front, uh, just don't underestimate China. Everybody last week was all over the 'China is a blip' story, and that's just not true at any fundamental level." We were looking for a good joke too, but he disappointed in this redundancy on the Israeli rate hike, "It's a harbinger of things not to come."

One surprise: Santelli said "Kill Bill" is "one of my favorites."

[Friday, August 21, 2009]

Fast Money Review: Goldman
tries to soften bonus bashing

Featuring: Charles Gasparino | Goldman Sachs | Karen Finerman | Melissa Lee | Guy Adami | Steve Grasso | Joe Terranova | BTU | C | FCX | Meredith Whitney | Carlos Gutierrez | TBT | Rick Santelli

Charlie Gasparino, or "Chas" as Melissa Lee likes to say, was the star guest of "Fast Money" on Friday and talked about his report (originating in the Daily Beast and covered in other appearances on CNBC during the day) that Goldman Sachs is going to have a lot of bonuses to dole out in 2009 and is very concerned about its image and various conspiracy theories, with some fears of anti-Semitism. Thus, the firm wants to improve its image, and to handle its bonuses, might do a stock buyback that would avoid headlines of Lloyd Blankfein collecting $60 million.

We covered this in-depth on our home page. On "Fast Money" Gasparino said, "Image does matter to them, and they're getting creamed." Then he and Steve Grasso had an interesting exchange.

"Goldman has figured it out," Grasso said.

"What have they figured out?" Gasparino asked.

"They figured out how to make money ... Goldman is the best of the best," Grasso said.

"It's actually not that hard to make money in this environment. You borrow at zero, invest at 3..." Gasparino chuckled.

We got the impression that the "Fast Money" crew hadn't yet read Gasparino's Daily Beast article on the subject explaining the "menu" of three options, but nevertheless they did ask some good questions about a buyback after Gasparino had signed off.

"I'm still trying to figure out ... they're gonna buy stock back because they're...?" Guy Adami wondered aloud.

Karen Finerman said, as Gasparino indicated previously, many Goldman Sachs execs own a lot of shares and that a buyback would "maybe give them liquidity they wouldn't normally have, although they would have to account for that compensation as well ... I don't know, I don't think it's an issue."

Joe Terranova sounded offended that people would criticize Goldman Sachs for making gobs of money after getting a bailout, a commercial bank designation, then indirect assistance from the AIG bailout. "What I don't understand is basically the fall of 2008, everyone went underwater, and Goldman Sachs was able to hold their breath the longest," Terranova said.

Some of Gasparino's best moments on TV occur when he talks about the Rolling Stone article on Goldman Sachs by Matt Taibbi, and we'd like to see more segments devoted to that (we're not taking sides here), although at the same time we wonder how many regular Joe CNBC viewers actually know what this is about.

Guy Adami declared Friday, "I've been more wrong than the Mets medical staff last couple of weeks, so mea culpa on my part."

No need for mea culpas, especially if you saw the kinds of trades CNBCfix makes. Guy is an undeniably great trader and will bounce back, although we must admit we wish he had taken the Dennis Gartman "market telling me I'm wrong" advice about two months ago and let it ride.

Adami noted that Meredith Whitney today "made some pretty cautious comments ... about the banks" and that people aren't listening to her like they did a year ago. He said of WFC, "I would think it's a short here, but again, this is the deep end of the pool." He is also skeptical of certain merchants: "Specialty retail trade, wayyyy long in the tooth."

Steve Grasso actually sees a good trade in one bank trumpeted a couple months ago by Richard X. Bove — Citi. "I bought it around 4 and a nickel, and I bought it, uh, again today on momentum, just to average higher," Grasso said.

Karen Finerman agreed to some extent with Guy Adami, "I'm skeptical ... I do have money on the sidelines," but she also made a point about not shorting the regional banks, because "they are the ones that could be taken over." Finerman and Grasso disagreed on whether the market might be hurt by year-end tax selling. Karen said she doubts that would be a problem because people have enough carryover losses, but Grasso said there's a perception out there at least.

Joe Terranova claimed "everyone is underinvested" and said he has "established a position in BTU ... I added on Suncor ... Weatherford, and Freeport McMoran."

Fomer Commerce Secretary Carlos Gutierrez, when he wasn't calling Melissa Lee "Michelle," talked about the potential decline of America in this hyper-spending environment. "We're gonna be begging the world to lend us money," Gutierrez said, adding "why should we be positive about the future? What is the catalyst? What's gonna make us grow?"

Karen Finerman and Guy Adami both detected partisan politics here. Karen asked Gutierrez about what the government could've done or should do now in light of the situation it found itself in. "What can they do right now ... given the hand that they were dealt ... they had to do something, right?" Gutierrez dodged the question and turned it to business owners and said they must take a "basically a defensive posture."

Adami was more blunt, asking, "I wanna be tactful and respectful here, but when you were part of the ... previous administration, you painted a bit of a rosier picture than you're painting now. Have things changed that severely, or was just a political thing then, now that you're back in the real world talking a different game."

"That's a fair question. Things have changed," Gutierrez said. "We're not focused on trade, our trade is way down, um, we are, it, it seems like we've declared war on business..."

Karen said in terms of trades, "I am short the long end of the Treasury curve" and will be for a while. (This writer is long TBT.)

Rick Santelli — next week's guest host whose presence was deemed important enough for Melissa Lee to pre-announce her vacation by two days — declared "We have a long way to go in housing."

[Thursday, August 20, 2009]

Fast Money Review: Would you
take Ken Stabler or Eli Manning?

Featuring: John Madden | Guy Adami | Tim Seymour | Pete Najarian | Melissa Lee | Karen Finerman | ERTS | GME | Steve Milunovich | HEV | FSLR | AIG | CZZ | CPO | UNG | GPS | Edward Stack | DKS | SHLD | NOK | ARO | CX | Amanda Drury

With the exception of Joe Theismann — who truly likes talking about stocks — we're always suspicious of motive when celebrities appear on "Fast Money."

John Madden, no longer announcing NFL games, is dishing out interviews to coincide with the release last Friday of Madden 2010 from Electronic Arts. The L.A. Times, for example, scooped the "Fast Money" crew in certain respects with a lengthy Madden Q&A on Thursday.

As far as stocks go, the "Fast Money" version of Madden amounted to Guy Adami calling the ERTS valuation way too high and said anyone who owns it is hoping the company gets bought, and Karen Finerman calling GameStop too cheap, but someday they'll be downloading games from the Web and that'll crush GameStop.

Madden was cheery and a good sport, telling the crew, "You guys have way too much fun" (we're not sure why) and explaining he's definitely done broadcasting: "I did my last game that I'll ever do and I'll never do another one."

He said Madden football as everyone knows it succeeded because "we were ahead of everyone, right from the get-go," and remained ahead of everyone. Madden tells the Times he was approached by Trip Hawkins of EA Sports back in 1986 and says "there were no video games," a point he made on "Fast Money," except of course there were video games, although whatever the flavor of the month at the time was (Nintendo? Colecovision? Atari?), we can't remember.

Guy Adami reported being a Giants fan from the "Mendenhall days," a reference to John Mendenhall, and a brief background is in order. The New York Giants of the entire 1970s were one of the sorriest teams you've ever seen. (Frankly, the Jets were too.) Never made the playoffs in the decade, routinely drafting high and even trading premium picks for guys like Craig Morton, losing the Miracle in the Meadowlands. Anyway, John Mendenhall was one of the few good players the Giants had in the '70s, though this wasn't Mean Joe Greene and we're kind of surprised at this reference.

Adami asked Madden if he'd take Ken Stabler or Eli Manning, and Madden said he'd have to go with Stabler. We'd have to agree with that one, but Eli has several more years to change our mind.

Pete Najarian asked Madden a real hard-hitting question: does he stay in touch with his former coaching assistants? Specifically, Pete mentioned Charlie Sumner, who was a longtime Oakland Raiders assistant. Tim Seymour asked Madden about Michael Vick, saying "He seems almost unmanageable." Madden didn't take up that point but said he has a high enough regard for an NFL player that a guy can't just take two years off and suddenly be ready to play. Seymour asked if Vick's specific skills mean the team that signs him (Philly) has to redo its offense. Madden said that's possible and a major unknown.

The meat of the L.A. Times interview, which "Fast Money" didn't address, was that Madden is now going to watch all the real NFL games, and he's also going to watch people playing the Madden video game, from a studio in Pleasanton, Calif., and thus incorporate what real NFL players and real video game players are doing to better improve the game.

Apparently, if we understand Melissa Lee's brief remarks correctly, Madden got on Guy Adami's case off-camera because Adami suggested Madden doesn't really watch "Fast Money," or something like that, and Madden insisted he does. We also heard, during a commercial cut, something that sounded like a Karen Finerman question to Pete Najarian about Ken Stabler (wonder what that was all about)...

We were wondering how Guy Adami would characterize the market's tendency to bend upward despite a bad start to the week that had him predicting 970, then as soon as that happened, 905 "within a week."

"I still think the volatility's gonna come back with a vengeance in the fall," he said Thursday. "I think the Vix is too low, I think the S&P is too high, but I've been proven wrong over and over again."

Speaking of wrong, and we're not trying to harp on Adami here, but remember back in July, when everyone on "Fast Money" was scoffing at the AIG reverse stock split? On July 1, Adami said "This is sort of the death knell to me," and investors should "run for the hills." Tim Seymour called the reverse split "a sign of weakness" and "totally inefficient." Pete Najarian asserted, "They'll see it in the pennies again."

Later in the month, Jared Levy recommended the February $12 puts.

So the reverse split opened July 1 at $18, trickled down to $9 in a week, and now sits at $32. Not "pennies" just yet. If you want "fast money," there you go.

Karen Finerman says it has to be a short squeeze. Tim Seymour demanded to know who's in charge of the AIG assets and wants to make sure it's the government and not the people who ran the company into the ground.

Unfortunately, other than the "News Now" segment before the show, there were no Mandy Drury sightings on "Fast Money." Melissa Lee and Karen Finerman both looked great but unfortunately there might've been a coordination glitch in that Lee was in burgundy next to Finerman's magenta. Nevertheless, K-Fine, who is definitely a member of the All-Madden Team, was in great humor on Heinz: "Oh the anticipation was worth the wait."

Then she said, in helping introduce the sugar trade, "It's like Tawny Kitaen." Tim Seymour tried to have some musical fun during his discussion of sugar, but other than Def Leppard, the tunes were indecipherable to us too. "This is more than a squeeze, this is a structural trade," Seymour said. "The top three producers are ... Brazil, India and Pakistan," he added, telling of bad weather in southern Asia (see, this could've been a Mandy Drury segment too) and saying to "right now play it with Cosan (CZZ) ... these guys are minting money." He also suggested CPO as a play on corn sweeteners because of sugar "shortages around the world."

Steve Milunovich, the Bank of America/Merrill Lynch "clean technology" guru, discussed the alternative energy field that so many find dubious, but did it so well in discussing the limitations that interested shareowners should check out this segment if they can.

He said investments are "gonna require some patience, clearly" but thinks we're in the "sixth technology revolution" on the cusp of something big, whatever that is, and Melissa Lee rightfully and skeptically said, "feels like we've been on that cusp for years now."

"It's just a question of when," Milunovich said, and he pointed to solar. "Literally in an hour you get enough sunlight to create electricity for the world for a year. It's just turning those photons into electrons that's tricky," he said. "Ironically though it's the most expensive alternative energy approach today." When it comes to wind, he acknowledged the Midwestern nature of the source and said it will eventually provide 20% of our power, but the "problem is we need transmission" and that Europeans are ahead on this subject. He said "We have a buy on Ener1 (HEV)," and "in solar we like First Solar (FSLR)." He said IBM and CSCO are also doing alternative energy things, but we can't imagine buying those stocks for that reason.

Pete Najarian made a great point about solar's competition from coal, that it's all about the electricity space.

Karen Finerman talked about nat gas being in "free fall" (something Adami thought had bottomed or was due for a bounce earlier this week) and what might be a disconnect of sorts with the UNG. She said she doesn't know where nat gas will go in the short run, but in the long run it seems like it has to go up eventually. Seymour pointed out storage is near or at capacity so new supply immediately enters the market.

Adami said the Gap story is promising but the stock is too high now. In the "Web Extra" (we actually watched this one), Finerman questioned how Eddie Lampert could provide enough liquidity for his investors with such a concentrated holding in SHLD. "I would stay away on both sides, short or long."

Ed Stack, CEO of Dick's Sporting Goods, talked a bit about the consumer. "We think the consumer's still cautious out there," he said. "We're cautiously optimistic at the present time." Guy Adami asked about rising inventories but Stack attributed that to store expansion and said on a square-foot basis, inventories are down. "The golf business has continued to be, uh, a bit of a challenge," Stack said, and oh my, CNBCfix could not agree more with that statement. Stack said the "gun and ammunition business, uh, in particular has been very strong," and that his highest-margin category is the "apparel component."

Melissa Lee asked him some good questions about selling the Michael Vick jersey. Stack said no decision has been made yet. "We'll take a look and decide what we want to do," he said. "To this point we haven't seen a significant demand."

We noticed according to the show's online disclosure, which to be completely honest is often riddled with errors based on what the traders say on the show, Guy Adami does not own GS.

MLee made at least a couple of funny jokes, saying of Plaxico Burress, "He's lucky he got shot in the leg and not somewhere else," and another wisecrack about the "putpockets."

In the "Final Trade," Seymour liked NOK, Adami said to take profits in GPS, Finerman likes ARO and Najarian likes Cemex.

[Wednesday, August 19, 2009]

Fast Money Review: Fleck
is Fed up with Bernanke

Featuring: Amanda Drury | Bill Fleckenstein | Ben Bernanke | Pete Najarian | Tim Seymour | Karen Finerman | Joe Terranova | Melissa Lee | Dennis Gartman | FCX | Mark Mahaney | GOOG | CIEN | POT | John Madden | XOM | AMZN | SYK | HPQ

"Fast Money" viewers got a double Drury of Mandy on Wednesday, but before we get to that, Bill Fleckenstein has come calling again.

Fleck, figuratively speaking, would love to just toss the whole Fed overboard.

The present problem, according to Fleck, is that Benjamin Bernanke has kept the "more easy money" spigot flowing.

"If we want to continue down that path of irresponsibility, he's your man," Fleck said. But "it's not just the man, it's the whole way the Fed goes about what it does. It tries to pick the right amount of money to print and it does so by the seat of its pants."

That's where we'll step in. (We can, because this is our site.) The Fed is definitely not picking the right amount of money to print "by the seat of its pants." Despite its official exclusivity, this is a massive bureaucracy, arriving at consensus only after enormous considerations from an extreme network of constituents (Congress, bond pits, White House, community banks, foreign central banks, etc.). You can replace all the members of the FOMC and none of the decisions will change.

Bernanke's status is a major pickle for the president, who campaigned on "change." So far he's kept the guy who was running George Bush's wars, and he apparently isn't going to make any material changes to health care. If he reappoints Ben Bernanke, some people who supported him are going to wonder what they were supporting.

Bill Clinton reupped Greenspan with no backlash. Times were good then. The truth is the position is an ultimate bureaucrat and in nearly all cases should be regularly replaced; otherwise too much power (i.e., the very limited free rein that exists in this role) becomes affixed to one individual and a profoundly unwarranted cult of personality develops. The problem with making a change is the potential for short-term panic in the bond and stock markets that might interpret the move as a significant change to monetary policy, which it almost could not be, but the perception might easily occur, and the last thing this administration wants is a plunging stock market because of a White House decision.

As said, a bureaucracy.

Anyway, Fleck has long been one of the best "Fast Money" guests, but it's safe to say 1) there are gobs of highly paid, well-trained economists of various political persuasion involved in the overnight lending-rate process, already long aware of Fleck's and Warren Buffett's concerns and constantly researching them, 2) the policy we've got/had is the result of this large body of research, and 3) this policy, like all others, is just the best collective educated guess of the time, might be right, might be wrong.

Pete Najarian put together an impressive, long segment on "training camp" for trading. Watching him zip through the tackling dummies, you kind of wonder if he could still play in the NFL. (It also makes you wonder how difficult it might be to actually tackle Pete or a lot of NFL players, given that Pete went 6-2, 230 as a player, with great speed, and we certainly would not be getting in his way at the 1-yard line.)

Pete's advice was basically to hang onto the winners and cut the losers and pay attention to the trading ranges, and when it's time to buy, consider using puts to protect yourself. All of which is great, if generic, advice for viewers at home, but it's this site's obligation to point out something Pete didn't tell us, which is that a big reason he makes more money trading than we do is because Pete is, "together with brother Jon, co-developer of the Heat Seeker® and complementary programs for tracking unusual buying activity in stocks, options, and futures," according to the optionMonster Web site.

Holding the winners and cutting the losers is great — developing software that tells you where big buys are potentially coming is an even better way to go.

It's like Pete giving us tips on playing linebacker in the NFL. No matter how many X's and O's, we're probably not going to be suiting up on Sundays.

The panel spoke with Dennis Gartman, but he gave more extensive analysis earlier to Scott Wapner during an excellent market discussion in the "Fast Money Final Call."

Gartman told Wapner, "Stock market's probably still going higher ... the market won't go lower, it's really quite amazing. ... The fact that you've given back 20% (in China) is not really all that shocking. I have my very serious doubts as to whether we'll get anywhere close to last November's lows in China or that we'll get anywhere close to last March's lows here in the United States."

Gartman added, "We're long high-beta crude stocks, we're short rather more boring ones. It's a bullish trade. ... Once (oil) got above $70, I was surprised ... China ... they are the taker ... China needs all the energy it can get its hands on. It doesn't need to stockpile it."

Mark Mahaney came on the set to pound the table for Google. He said he's got a $580 price target but could see $600 too. He said there's a "new secular growth driver coming in, in the form of mobile searches." Melissa Lee wasn't that impressed. "I've heard mobile search for a while now." Mahaney said something about how there are going to be all these Google ads with it. Bottom line? "You wanna own Google," he said.

"This is a great stock picker's market," Tim Seymour said. In utter defiance of Guy Adami's ongoing call that we're going lower (first 970, then 905), Karen Finerman trotted out a cliche: "It's money sitting on the sidelines," and there's "more ... still to come." Pressed by Melissa Lee, Karen admitted she was one of those people with a little bit on the sidelines, "I admit it."

Karen made a funny comment about Pete Najarian's description of Goldman Sachs adding FCX to the conviction buy list. Pete and Tim Seymour agreed that Potash could be due for a breakout.

Pete pointed to an "incredible amount" of option activity in CIEN, with one of those cliches, you know, the fact they're buying the options that expire THIS WEEK! Those popular August 12 calls, "these expire on Friday!"

Finally, it's Mandy Time ... Mandy Drury once again ushered in "Fast Money" with the "News Now" segment Wednesday, then, in a treat for viewers, bookended the show with another segment on the Shanghai composite.

First, we'd love to accurately categorize Mandy's dress, and incredibly we even spent a few Internet moments trying to figure it out, but we've really got no clue except to say it appeared to be tight fuchsia with some kind of floral print. What was noteworthy was that Drury has evidently raised the bar around CNBC. One Web site claims Erin Burnett is feeling the heat. Always playing at a high level, Melissa Lee on Wednesday went to a straighter hair look to complement a voluptuous white-black combo top, while Karen Finerman unveiled what we think is a brand-new sleeveless gray look. Lee was pitch-perfect the entire show but Finerman unfortunately was a bit subdued.

Anyway, Mandy revisited the Chinese stock market from Englewood Cliffs, saying it's "driven by retail investors who are very sentimental" and presumably might get gun-shy if they get burned. Tim Seymour asked if there are concerns on the ground about possible Chinese government meddling in stock markets. Mandy said the government has a keen interest in part because "there's a huge pipeline of state-owned companies that are going to be IPOing soon."

Melissa Lee left us with a major cliffhanger. She said at the end of the show that Rick Santelli would be hosting "next week" while she's on vacation. But then what happens Thursday and Friday? Is she pre-announcing her vacation two days in advance ... or is she gone as of now, and we're going to get the host TBA on Thursday and Friday? Could Mandy get the nod?

John Madden is an announced guest for Thursday, and we're looking forward to that. Just don't get him started on the Immaculate Reception. He'll say something like, "The thing that really bugs me about that play and will always bug me about that play is, in the history of football, when something happens, it's either a touchdown or it's not a touchdown. Here, they didn't call anything. Then the referee goes in the dugout, calls security, asks how much security he would have getting out of the stadium if he called the play correctly which is that (insert choice here ... A) the ball hit Fuqua first, B) the ball hit the ground, C) McMakin clipped Villapiano) and the touchdown doesn't count, and he was told no security, so he says touchdown Pittsburgh."

Seymour liked XOM, Joe Terranova picked AMZN, Finerman chose SYK and Pete Najarian picked HPQ for "Final Trades."

[Tuesday, August 18, 2009]

Fast Money Review: Adami says
970 first, then ‘we trade 905’

Featuring: Amanda Drury | Melissa Lee | Joe Terranova | Guy Adami | Steve Grasso | Rich Greenfield | NWS | Redbox | 970 | 905 | oil | VIX | OXY | TRLG | APA | David Bell | ISIL | Doug Cliggott | Steve Cortes | WMT | Brian Stutland | UNH | GOOG | PALM | AAPL

The most important news heard on Tuesday's "Fast Money" was the revelation that Mandy Drury is going to be hanging around New York for three more weeks, and might make a return visit to "Fast Money."

Drury was on the set to point out how the Shanghai index has become a "leading indicator as to what's gonna happen with worldwide stocks," despite the fact, as Melissa Lee noted, it's not a mature stock market and isn't viewed as having the efficiencies of the U.S. market. A valid point, interesting topic, and tremendous idea to have Mandy delivering a point such as this and leaving it as is, rather than some stuffy Pacific Rim hedge fund chief who will tell you to "be cautious on China Mobile and Baidu" and "don't get complacent," yada yada yada.

Drury, who's in great shape and wore a sparkling black dress, managed to crack up Guy Adami (not shown on camera) when she told Joe Terranova, "I'll happily go down under with you ... that came back completely wrong!" Fast times on "Fast Money."

Rich Greenfield of Pali Capital made an overdue return to "Fast Money" and once again didn't disappoint. He took up the topic of Redbox and the film industry's profitability stream and, as with his other appearances, delivered a mountain of interesting facts in straightforward, layman terms.

He said the movie industry had transitioned beautifully from VHS to DVD, then all of a sudden these 19,000 rental kiosks started cropping up like weeds, and the industry is truly struggling to deal with them, because people might be more inclined to rent for $1 than buy a disc. "A dollar a day is a really low price point when you look at any other part of the movie industry food chain," he said.

He said the big issue is the "window" — the amount of time between the DVD going on sale at Wal-Mart and appearing in the Redbox kiosk. If available in both the same day, many people will choose renting over buying. The movie industry, he said, wants a 28-to-45-day window before the kiosk gets the discs. He said 40% of the studios are working with Redbox to resolve this, while 60% are not.

He said this is an important subject for News Corp, which gets 25% of its earnings from the film business; also Time Warner, which gets 20%.

The news peg to this, as Greenfield noted, was a judge preserving 1/3 of Redbox's lawsuit, the antitrust portion, against Universal's 45-day wait. Redbox has also sued 20th Century Fox (30-day wait) and is expected to sue Warner Bros. (28-day wait). Sony and Lions Gate have cut five-year deals with Redbox. Redbox, according to the L.A. Times, is taking its case to the public on Web sites and Twitter.

Greenfield noted some movies, particularly Disney titles, are considered collectible and thus don't face serious rental competition. The same is true for blockbuster hits. The problem of course is that a lot of movies aren't big hits and might never get bought if they're in the kiosk from Day 1.

The movie business has always seemed like an exceptional business model. Put them in theaters for weeks, a community experience people can't duplicate at home, then pay-per-view at home, then cable and DVD, then show them for years (i.e., "Cocktail") on TV and collect the residuals. One thing we don't understand is why they don't put the major Oscar-winning films on pay-per-view the night of the Oscar telecast, but whatever.

Melissa Lee, who occasionally has trouble with names, called him "Rich Pali" at the end of the segment before correcting herself. (She once said Steve Cortes was appearing on video from "Vera Cruz, Florida.")

The market may have been up, but Guy Adami wasn't buying. "I still think we go to 970 S&P. I think we break 970, we trade 905 within a week."

Pete Najarian said it had something to do, or not to do, with the VIX, Zzzzzzzzzz. Steve Grasso essentially agreed with Adami even though he's bullish, saying 950 is viewed as an "almighty level" and "if we break that, look out below."

Melissa Lee reminded viewers, "Don't get complacent out there, is the lesson." (See? We hinted from the top that we'd get a "complacency" warning somewhere.)

Grasso managed to goad Joe Terranova into a bit of an oil bet. "No one's getting the oil story right," Terranova lamented. Grasso asked Terranova if oil would first hit $85 or $55. Grasso said $85. Terranova eventually agreed. "So then you wanna be buying Oxy," Grasso said. Terranova did mention high-beta plays (uh oh) but didn't seem quite sold on where oil's heading.

Najarian said "love the coal names across the board," and he also said "everything's going right" with True Religion, "and it's cheap." Guy Adami said Apache is a way to play a possible bounce in nat gas.

Doug Cliggott was about as nonspecific as one can get playing the "Bull Market or BS?" game. Cliggott said if you combine Monday's market action (bearish) with Tuesday's (bullish), that's what we're gonna get for the next six months. "We're gonna have a market martini I guess," joked Melissa Lee, one of her best recent lines.

"We've never come out of a recession with household debt levels this high relative to income," Cliggott said. He recommends consumer staples, health care and electric utilities among a few other sectors in this martini market.

David Bell, CEO of Intersil, was articulate enough but didn't really offer any trading insight. "Visibility is still pretty poor," he said, but "the inventory is pretty well cleared out of the channel at this point" and he thinks production is matching consumption. Pete Najarian asked about "inorganic" growth and Bell responded, "It's a really bad time if you're a startup company" and aren't making positive cash flows because you're either going to be acquired or go out of business. He said that's good for companies like his that can scoop up promising companies at discounts.

Steve Cortes, not reporting from Vera Cruz, Florida, but in the flesh on the set, talked again about his recent "new normal" thesis that consumers are retrenching for the long haul. He said this theory is "promulgated mostly by Pimco," and we like it when people use terms like "promulgated." (We don't believe it here, but that's just our amateur economics opinion.) Cortes' recommendation? Wal-Mart, which could've brought an interesting debate with Greg Troccoli if Troccoli had only been on the show. "Time for Wal-Mart to reverse from laggard to leader," Cortes said, though conceding it's spent "10 years around $50."

Brian Stutland also was on the set, explaining options traders seemed to predict bullishness in UNH into January. We won't repeat Karen Finerman's reasons from last week as to why health-care legislation still might still happen.

For "Final Trades," Terranova mentioned GOOG puts, Adami said APA, Grasso said he's tired of waiting for an entry point on AAPL and would just buy it, and Najarian is talking about PALM and its apparent ability to outdraw techies from AAPL, a point Pip Coburn didn't exactly endorse yesterday.

[Monday, August 17, 2009]

Fast Money Review: Another
rerun starring Peter Schiff

Featuring: Tim Seymour | Dennis Gartman | Karen Finerman | Guy Adami | UNH | WLP | Peter Schiff | Melissa Lee | Pete Najarian | Brian Markison | Rick Santelli | 970 | Brian Markison | KG | Embeda | Jeff Tomasulo | IBM | JPM | Pip Coburn | ANSS | ADBE | SY | AAPL | HPQ | XOM | MSFT | PDE | INTC | Mike Khouw | TGT | EWZ | HD | LOW | Daniel Hamburger | X | MLee | RST | Lesley Ann Machado | Mandy Drury

A remarkably small amount of dialogue took place Monday on "Fast Money" over the White House's obvious retreat on a public option for health care, despite the fact Tim Seymour claimed he was "surprised" that the backpedaling happened so soon.

"This thing was set up to fail," Seymour said, only "it's surprising to me how quickly." Actually it's not a very big surprise. Every president is political, but this administration is the Dennis Gartman of politics, cutting those 1% losses faster than you can serve beers to James Crowley and Skip Gates, and listening when the market's telling them they're wrong. That's not necessarily a bad thing in politics, by the way, but that's how they operate. This site pointed out last week its (reasoned) opinions as to why health care was suddenly deemed a must this summer, and none of the reasons were particularly strong, making it about as likely to gain traction as George Bush's Social Security reform.

Karen Finerman was dishing out some compliments. The health-care industry did a "masterful job," according to Karen, in staying out of the spotlight and letting grass-roots protests run their course despite the fact their business models were at stake.

Guy Adami managed to (implicitly) push both sides of UNH in 10 minutes, first pointing out he had been bullish on the stock a while back, and that any time a stock advances in a tape such as this, it says something, an "interesting move," while the others groaned and Karen scoffed, "that amount of news (moving the stock) is enormous." A little later, Adami referred to the stock's runup again but said, "I would be getting out right now."

This site posted on its home page Monday the Wall Street Journal article suggesting Wellpoint (WLP) was the biggest winner, a point not mentioned on "Fast Money." The stock was up $1.50.

There was a time — actually only a week ago — where a Peter Schiff interview would easily lead our coverage of "Fast Money."

Quickly, we're seeing diminishing returns here.

Schiff has been spouting the same talking points for his last three appearances (in less than a month), with few if any investing specifics. It's clear the traders are struggling to press him for any more details beyond the U.S. is debting itself into oblivion.

Schiff came back on Monday, introduced with a redundancy by Melissa Lee, who wondered if today's decline was a "harbinger of more pain to come."

Schiff said, "We've been in a bear market since 2000. The rallies are the correction." But when Lee asked if the market was going to continue down or go back up, he said, "there's no way to know for sure."

Karen Finerman started to get somewhere by asking Schiff about the banking bailout that started in late 2008 and continued with policies into early 2009. She asked if Schiff would prefer the government had done nothing and perhaps allowed a catastrophic crash. Schiff said he didn't think it necessarily would've been catastrophic, and the problem now is, "think of all the debt we've accumulated."

Pete Najarian asked Schiff how much lower housing could go. Once again, Schiff framed the question in "real" terms (i.e., adjusted for dollar strength and inflation) and said home prices could fall "50% or more from here in those real terms."

We wouldn't mention the Rick Santelli segment so high up except as with Schiff it involved the dollar. Santelli said, "Commodities are backing into a dollar-strength scenario." He had some kind of debate with Tim Seymour and presumably arrived at some kind of conclusion we didn't get or didn't care about.

Given the market plunge, we expected to hear Guy Adami at the top of Monday's show, and of course it happened.

"I think we're going to 970," Adami said. "I tell you what, you get a close below 970, you'll go to 905 faster than you can blink your eye."

Karen Finerman brought up a word we discussed (probably too much) in-depth last week. "I think this is healthy; a little more down, that wouldn't be bad either."

We'll keep it brief: "Healthy" for what? That it can't get to 1,100 without going to 970 first? Where is the mathematical basis for this "healthiness"?

At least "we didn't see panic," according to Pete Najarian, who once again talked about volatility and the Vix, etc., Zzzzzzzzzzzz.

Tim Seymour offered a lengthy discourse after Adami's declaration that was probably too lengthy. He thinks the corrections shouldn't be so bad, but then again, yaneverknow. (This writer is long AA and DTV.)

Brian Markison, CEO of King Pharmaceuticals (KG), showed up to talk about Embeda, a promising drug that fights attempts to abuse it (we found that interesting too) and was approved Thursday. Markison did well in explaining the anti-abuse niche and how Embeda specifically works.

Markison explained there is an ingredient in the drug (naltrexone hydrochloride, we looked it up) that, if the drug is consumed as prescribed, merely passes through the body with no effect. But if the Embeda is crushed or altered, the naltrexone combines with the morphine to reverse the morphine's effects and "make hopefully the recreational use unattractive," Markison said. However, according to our source article, it's worth noting that as of yet, "there is no evidence that the naltrexone in Embeda reduces the abuse liability of Embeda."

Melissa Lee said analysts have high hopes for Embeda, which has been driving recent share-price gains. She asked Markison if a $300 million revenue estimate on Embeda was too low. "Hopefully it's a little bit conservative," said Markison. In our cited article, Markison says, "We anticipate a September 2009 launch for Embeda." Goldman Sachs analyst Shibani Malhotra in March predicted approval for Embeda in the second half of the year and gave the stock a $10 price target; it was trading around $7 at the time. “There is immense political pressure on the FDA to approve less abusable products (such as Embeda) and our contacts believe the FDA is looking to act as fast as possible,” Malhotra said.

According to this article Friday, analyst Robert Hazlett of BMO Capital called the approval expected and said something that wasn't broached on "Fast Money," that "this product (Embeda) will likely cannibalize sales from King's already marketed morphine Avinza." Hazlett said Embeda's peak yearly sales could reach $400 million. But he said Remoxy, another King product Markison mentioned, is a more "significant" drug that is still in the delayed stage. Louise Chen of Collins Stewart raised her price target from $12 to $13.

Markison also mentioned Acurox as another promising treatment. Markison has a B.S. from Iona, 1982, and has been CEO of King since 2004. King is based in Bristol, Tenn.

Jeff Tomasulo pulled double duty between the "Halftime Report" and the real show. His segment on the real show was one of the more useful "Fast Money" features in recent memory, even if you don't believe him and want nothing to do with the trade.

Tomasulo said IBM and JPMorgan have been trading in well-defined ranges. He gave viewers the numbers to buy and the numbers to sell. "IBM is a great trading stock right now," he said, explaining it's a buy at $116 and a sell at $120. He said playing this theory gives you a "competitive advantage over long-term investors." Unless, of course, you buy at $116 and it goes to $106. Tomasulo couldn't resist a Brag Trade in discussing JPM between $41-$43, saying he wishes he could've brought it up a week ago. "We've been making really good money off of this." Guy Adami asked him the question we were dying to ask, is there an overall S&P level "embedded" in this theory and is it based on a market "stall." Tomasulo said, "Guy, you bring up a great point ... I'm gonna play the range though Guy until it doesn't work again."

One serious problem with this segment was that the charts for IBM and JPM never showed the current prices, only yearlong charts that mean absolutely nothing when someone is speaking of a short-term range.

At "Halftime," Tomasulo did express concern with a specific S&P number. "The key here is to watch the 980 level in the S&P 500. If it closes below that level, then I'm gonna be a little concerned, because we can definitely see 968 in the SPYders. ... I wanna see volume."

Tomasulo was even more congratulatory toward his colleagues than K-Fine was to the health-care companies. Not only did he say "Guy, you bring up a great point," but we heard on the "Halftime Report" with Lee, "You bring up a great point" and "You're bringing up a good point."

Pip Coburn, the guy who's kind of a trend-watcher who (based on what he speaks about on the show) isn't really a "Fast Money" kind of guy to begin with, offered four tech companies he thinks could be permanent studs that will outlast rallies that reward junky stocks. Namely he means Apple, Sybase, Adobe and Ansys. He said he thinks the key for AAPL is the app store. "They're kind of running away with it," he said, suggesting developers don't care about Palm or Nokia platforms. He said AAPL is "our largest long position." He said he likes HPQ's ability to make profits while not really liking the business. He said its margins in services will be most telling.

Guy Adami said "shorting Brazil" via the EWZ was worth a look, but it's the "deep end of the trading pool." He said the place to get back in to WFC is $24.50 and that HD was a better company than Lowe's and not to be fooled by Lowe's results. Karen Finerman said "I'm staying long Bank of America" and that she thinks Centex represents a bottom of sorts in housing.

Traders briefly went round-robin on some stocks they like. We forget the theme, hidden gems or something like that, except all were monster names. Seymour said XOM is in this range from $66 to $74, Adami likes Intel but it will trade back to $16, K-Fine likes Pride and Pete Najarian likes Microsoft, the stock you'll never buy from Joe Terranova because he's not about to sell.

Seymour said in his "Final Trade" to buy U.S. Steel at $38. Adami said of KG, "below 10 it's interesting." K-Fine mentioned PDE and Pete mentioned MSFT (again).

Guy Adami mentioned the bad Rosetta Stone news and said the stock "probably goes lower." That's certainly no referendum on gorjus Lesley Ann Machado, who stars in the Rosetta Stone commercials (in either pink or royal blue) and whose stock never goes lower.

Mike Khouw talked about what options activity was signaling for a couple of stocks, the first being TGT. All we heard basically was that people are buying puts and people are buying some calls. We think the net conclusion is that there really isn't a strong bet on TGT's direction from this. We tuned out the rest, but apparently there's option sentiment that HPQ will dip to $40.

Not a surprise, but we're already groaning at every Regis Philbin reference that we knew we'd be hearing every day on "Fast Money." The guy's promoting his game show. So he goes on "Fast Money" and he talks about the Guy Adami face and now we're going to hear about the Guy Adami face on every episode. Why not bring Kelly on sometime and talk about something else?

A few days ago this site got an inquiry that went something like this: Why does Jon Najarian keep calling Melissa Lee "Emily"? Actually, what Najarian is saying is "MLee," a nickname combination of Melissa's first and last names that we think was started by Guy Adami a while back. As far as we recall, Adami, Jon Najarian, Joe Terranova and (previously) Jeff Macke used that moniker, maybe Pete Najarian but we don't recall. It's kind of an Adami thing (observation based strictly on watching the show). Full disclosure: This site, in the spirit of things, has also used the term occasionally. Adami is kind of fast and loose with the nicknames, such as "Harvard girl," etc., and Lee seems to get a chuckle out of them.

So there you go.

In the Fashion Department, Lee was crisp and chipper with light black jacket and Karen Finerman was equally impressive in relaxed orange. However — and this caught us off guard to say the least — Mandy Drury on "News Now" ushered in the show like a hurricane, flaunting an open white top and enormous hoop earrings in sort of a sharper Kim Cattrall look with mesmerizing Aussie accent. So, kind of a day where everyone else was playing for second before the first pitch was even thrown.

Congratulations to Pete and Lisa Najarian on their anniversary, with a great photo shown on "Fast Money." We could do some digging and maybe tap a source or something and perhaps answer the question asked by the rest of the "Fast Money" panel, how many years is this, but Pete didn't want to say, and we probably can't find it anyway, so we're going to let it go.

Catching up: Daniel Hamburger, CEO of DeVry, came on the show last week, and even though we took notes as always, we failed to include it in the review. "Most of our schools are actually not tied to the economy," he said. Karen Finerman asked if students were finding it more difficult to get loans, and he said, "No, they're not really having any problem." Hamburger did seem to have the right answer for everything, which makes us wonder, but was probably no less informative than most other CEOs on "Fast Money."

[Friday, August 14, 2009]

Fast Money Review: We’re still
talking about Robert Shiller

Featuring: Robert Shiller | Joe Terranova | second stimulus | Karen Finerman | Melissa Lee | Tim Seymour | JNJ | Mike Khouw | Warren Buffett | COP | Michael Hartnett | spin-offs | Melrose Place | ACH | PTR | CEO | AVB | KBH | Gregg Fisher | Jacob Zamansky | Madoff | Bill Ackman | MCD | Greg Troccoli | Dennis Gartman | Bill & Melinda Gates | BA | Gregg Fisher | Jacob Zamansky

Robert Shiller's dubious book-promoting "Fast Money" episode of Aug. 7 continues to get worse.

On Friday, Joe Terranova said this: "You know, we had Robert Shiller on the show last Friday, and he talked about a second stimulus."

That prompted a "say what?" in these quarters, as this site was (to our knowledge) the only media "organization" to report on Shiller's comments ... and did not recall any discussion of a second stimulus.

Turns out, Shiller talked about no such thing. Click on this link and see for yourself.

Even worse, Terranova made this reference during a segment on Mohamed El-Erian's word of caution on the consumer, so Terranova's comment implied that Shiller might be promoting a second stimulus, something he clearly did not do on the show.

It's pointless enough to reference what Shiller actually said. To talk about things he didn't say is really milking this thing for a lot more than it was worth.

Goodness knows why Terranova would be putting any stock in Shiller comments on anything besides home prices. Shiller on "Fast Money" actually said, "I think we have to, uh, overhaul our capitalist economy."

If you believe that, you probably shouldn't be on "Fast Money," and if you don't believe it, there are probably better sources to cite than Shiller on the second stimulus. (Note: Laura Tyson maybe isn't a good source either, given that her "Fast Money" comments on the subject were a lot different than what she told Bloomberg a few days earlier.)

One "Fast Money" subject this site could not possibly care less about would be the quarterly changing percentage of Warren Buffett's stake in Johnson&Johnson (or Burlington Northern, or ConocoPhillips, etc.).

Mike Khouw, though, somehow thinks the latest Buffett revelation might be a JNJ buying opportunity "at long last."

Joe Terranova actually saw a contra-indicator, saying the fact Buffett is "divesting himself of ConocoPhillips" is a bullish sign. "Now that he's out ... that's a classic trade ... right here, you go in and you buy ConocoPhillips."

Whatever floats your boat. It's clear to us that delayed reports about Buffett's holdings are about as useful to a stock buyer as the noise from your neighbor's party at 1:30 a.m., but knock yourself out.

Khouw, by the way, has facts and points to offer, but can't seem to do it without a monotone. He kind of comes across like the geezer who sits next to you on the train and mumbles tired answers while you're sitting there compelled to ask him a question or two just to be polite and avoid awkwardness.

It was Friday, and the show amounted to little more than a recap of things said throughout the week, so before we get into that, we'll have a little fun with the "Melrose Place" talk during the promo for "Options Action."

First of all, "Melrose" was described as a "spinoff," something we believe it is not. It was indeed part of the "tree" of Fox's Darren Star shows beginning with "90210," but was a new show with new characters.

Second, we doubt if "Options Action" is even rightfully a "spinoff." The few times we've seen it (and CNBCfix has never traded options, and while the trades mentioned make sense here, this is mind-numbing television for non-options traders), it hasn't had any of the "Fast Money" crew on it, unless you count Stacy Gilbert, who only appeared on "Fast" about a handful of times, strictly as a guest. A true "spinoff" would involve Jeff Macke being given the bottom half of Dennis Kneale's hour in "CNBC reports" to talk about the "car people" and leftist policies and trading the market you've got not the market you want and not being a hero and interviewing some of his faves like Jonathan Vilma.

Third, "Fast Money," in fact, actually IS a spinoff — from "On the Money," and no, not the Carmen Wong Ulrich version that got banished to once a week on Saturday, but the old Dylan Ratigan version, which then became the Melissa Francis-interviews-Paul-Kedrosky-or-Michael-Wolff-every-night-and-Michael-Santoli-on-Friday's-until-the-anti-Cramer-article-ran-in-Barron's-and-also-occasionally-covered-the-porn-biz edition.

Fourth, in the category of best spinoff ever, the vote here is either for "Frasier" or "The Simpsons." The "Fast Money" crew joked about "Mork and Mindy" several times Friday, but we didn't know until consulting the Wikipedia list that "Happy Days" itself is considered a spin-off of "Love, American Style." The show most memorable for being a spin-off quite possibly is "Joanie Loves Chachi."

This is the point where we'd like to have seen a Day 3 of Charlie Gasparino being asked to "connect the dots" between John Paulson's BAC buy and Eddie Lampert's C buy, but that didn't happen, so back to the market we've got, not the market we want ... Tim Seymour said, "I don't think any of these pullbacks are gonna be that steep." Melissa Lee rattled off a cautionary note to investors from Michael Hartnett of Bank of America, who evidently noted global market caps have surged, that the Chinese and other emerging markets have started rolling over and that everyone's ahead of their 200-day moving averages.

According to this article on Dow Jones Newswires by Joan R. Magee and Kejal Vyas, Hartnett wrote, "Everyone is looking for a correction," but at the same time, "we remain cyclical equity bulls and buyers of what we think will be modest dips."

Tim Seymour spouted some price-to-book or price-to-equity or some other ratio and said "he doesn't think the market's expensive," just due for a pullback. But in the case of China, Seymour said, "I do think there's a lot of fluff in that market," saying Chinalco (ACH), Petrochina (PTR) and CNOOC (CEO) are names to be wary of. Also he said "be very careful of Petrobras," citing the rush of entities to get a slice of the pie when state-owned companies flourish.

Hartnett's opinion aside, one word we tend to question on "Fast Money" is "healthy." As in, "a 5% correction here would be 'healthy' for the market."

What exactly does "healthy" mean in this context? We should want the market to go down? How is it healthier when it goes down?

Remember back in February 2007, when the Shanghai market suddenly crumbled overnight and the Dow plunged 416 points (only 3.3% then) the next day ... was this a "healthy" correction? The Dow recovered rather quickly (despite what Dylan Ratigan predicted around that time on "The McLaughlin Group"), only to begin its fall off a cliff in November 2007.

If the idea is that a small correction ultimately makes stocks go higher, we don't see the mathematical proof. If the idea is that little corrections are needed so that a stock doesn't go straight through the roof, because if it does go through the roof eventually people will bail and the whole market will crash, that also doesn't seem justified, because either the company's performance will ultimately merit such a rising price, or (in the case of most dot-coms) it won't, and that's the risk every investor takes.

One could say, it would've been best if the housing market had pulled back a bit in 2002 or 2004. Maybe so. But then presumably people would've bought on the dips and only extended the long-term housing bull market farther into the future.

When "Fast Money" people talk about a "healthy" correction, what they are really talking about is speed. It's likely that if AAPL or Goldman Sachs rose approximately a nickel a day, every day, roughly $1 a month, $12 a year, nobody would care in the slightest about a "healthy" correction.

What the traders seem to somehow fear — despite how much they talk about "these are the greatest trading markets of my lifetime and a bunch of lifetimes," etc. — is when AAPL or GS goes up a couple dollars a day. Somehow, that is viewed with alarm in some quarters.

Bottom line? Anyone who talks about a "healthy" correction is someone who should be denouncing the rallies.

Joe Terranova announced "I got short this week Avalon Bay (AVB)," and he's also short KBH. Karen Finerman wasn't fully in that camp. "We're actually short again the REITS; disagree on the homebuilders though."

Terranova said he still sees an "overwhelmingly bearish contango" in commodities. Dennis Gartman said "this market's gotten awfully, awfully overbought," everyone is short the dollar, and he thinks a commodities correction might last another couple days. But as to Terranova's point, we still feel like it's tail wagging dog kind of stuff. "It takes two to contango," Gartman said.

Greg Troccoli, who is looking a little off in his recent prediction of WMT down to (first) $35, (then) low 40s, talked about S&P 500 support levels. "A close below 989 would bring the market down towards the 950, 960 level, he said." Tim Seymour thought maybe people would be safe down to around 980. Troccoli made a bolder prediction on the 10-year Treasury: "I think we hold 3%," he said, "for years to come."

Karen Finerman said something really interesting about Bill Gates as an investor. She said "I never follow Bill and Melinda Gates for a couple of reasons, they don't have the reputation of being particularlyyyyyy (that's how she said it) successful," and she also doesn't think they have anything to do with running the investments of the foundation. So much for whale watching.

K-Fine used her favorite term — "ridiculous" — twice in referring to the latest problem with (you guessed it) the Boeing Dreamliner.

Joe Terranova made what we found to be one of the more curious technical analysis arguments we've heard. Something about the Dow 9626 level of Barack Obama's election and how we haven't passed it yet, but if we did, it would be a "great referendum" on this White House, according to Terranova.

Karen Finerman said MCD people must be dismayed that Bill Ackman is now on board, "he's just gonna be a thorn in your side."

Catching up: We hate to let a "Fast Money" guest slip by without comment, but a couple from recent days somehow got by without making the review. Gregg Fisher made a case for small-cap stocks, apparently based largely on low interest rates, that didn't seem overwhelmingly convincing, but who knows. Also Jacob Zamansky (his name was spelled two ways on the screen) discussed the Madoff case and had this gem: "If you have the last name of Madoff, you're in a lot of trouble."

Karen Finerman closed out a grand week of fashion with a black sweater-type outfit with ruffled top; Melissa Lee offered a layered red ensemble. (We were hoping Michelle Meyer of Barclays might sneak back to the set for an encore Friday, but didn't happen. We were hoping to see Dani Hughes again on the "Halftime Report," but didn't happen.)

By the way, we're not sure how long this has been up, but Melissa Lee now appears as one of the "Fast Money" cast according to the show's home page, as does Joe Terranova. (We're guessing a contract thing was involved here with Lee but have no idea what it might've been.)

[Thursday, August 13, 2009]

Fast Money Review: ‘You want
me to get fired here? Jesus’

A day after his John Paulson-BAC scoop, Charlie Gasparino showed up Thursday on the set of "Fast Money" to apparently continue the report and maybe draw a comparison to Edward Lampert's Citigroup buy back in 2007.

No one said anything about "what have you got." But along the way, Gasparino, Tim Seymour and Melissa clashed a bit over "making a call" and "connecting the dots."

Before launching in to our own official transcript, a brief background note: Seymour got cut off when trying to ask Gasparino a question a couple months ago, and perhaps remembered it Thursday when Melissa Lee got things started:

Melissa Lee: "Let's go 'off the record' with the man who's never shy about his opinions and of course that is Chas Gasparino. Charlie."

Charles Gasparino: "You called me Charles before, I thought you were being very formal."

Lee: "No, now I'm gonna call you Chas."

Tim Seymour: "How about Chuck?"

Gasparino: "Sure."

(CNBCfix editor's note: Uh oh ... early sign of trouble ... bit of a taunt from The Ambassador here? ... Check out this link to CNBC's "I am CNBC" commercials in which Gasparino explains where he stands on the word "Chucky")

Lee: "I'd call you other things, but that's all right, go ahead."

Gasparino: "All right. ... Um, different environment, right, I mean, remember May 2007, I mean, subprime crisis, was just burd-... by the way disclosures were a lot different back then, didn't have mark-to-market accounting, we didn't have, we don't know enough about, the disclosure requirements right now are a lot more difficult than they- than they were back then, and, I think, you know, Paulson probably has his i's dotted and t's crossed, I think this is a different bet than that, I mean, we know what's on Bank of America's balance sheet broadly, we know that they may have some commercial real estate exposure, we know that they've refinced (sic) a lot of those bad assets we know that the Fed is basically saying, the Fed and the Treasury, hey take as much risk as you want, interest rates at zero, do a carry trade, make some money, you know, there's only a few sort of dealers left right, they got rid of Bear..."

Seymour: "Charlie are you making a call here on Bank of America?"

Gasparino: "No, no, no, they got rid of Bear Stearns, they got rid of Lehman Brothers, I don't make calls..."

Seymour: "Well ... I'm unsure where you're goin'..."

Gasparino: "It doesn't matter where I'm goin' ... I don't, I don't ... pick stocks ... I'm giving you my opinions..."

Lee: "This could turn out better for Paulson than Citigroup turned out for Eddie Lampert, is what you're sayin'..."

Gasparino: "If you look at, at the facts, different environment, I think it's, it's, you know, listen, I brought up the Eddie Lampert thing last night, right, it's a fun little comparison, but it's different environments..."

Seymour: "But, but, so we know he bought 187 million shares..."

Gasparino: "You make the call, bro! You make the call!"

Seymour: "I'm just trying to understand your point..."

Gasparino: "Don't get me to make the call. You want me to get fired here??! Jesus..."

Seymour: "Is is is, the point that he's jumped two feet in, into this stock, in the second quarter, and it may not be the right time to get in..."

Gasparino: "We know, my point is simply, my point is simply this, we know a lot more about banks now than we knew back then, and we got interest rates, right..."

Seymour: "So shouldn't he know more, and therefore be smarter in actually getting into a bank, and maybe I mean, first of all this guy looks like he's ridden the ride in the, in the fare on the way down, and back on the way up, I mean so far that's, that looks pretty smart."

Gasparino: "Right. We have to, like, back up a little bit. This was the guy who famously — that's why all these conspiracy theories about Goldman shorting the subprime market 2007, 2006 and that somehow they knew something that no one else knew so they shorted it, I read something in some, like, music magazine about this, but anyway, uh, you know what magazine that was..."

Pete Najarian: "Vibe?"

Gasparino: "Rolling Stone, maybe ... whatever, you wanna know something? Eddie, uh, uh, what's his name, Paulson was shorting it back in 2005, 2006, because people saw some of the problems in the housing market, so, uh, listen, smart guy, different environment, it's kind of an unfair comparison..."

Lee: "So let's, let's, let's connect the dots then Charlie, I asked you this question yesterday..."

Gasparino: "You connect the dots. You're trying to get me to make a..."

Lee: "Listen, listen to what I'm asking you before you answer the question (laughs)..."

Gasparino: "Do I have a hedge fund on the side or something?"

Lee: "You're saying it's a very different environment now, we know a lot more about the banks than we had before because of disclosure. So therefore does this in fact relieve the pressure off of Ken Lewis?"

Gasparino: "Well that's a different question, um..."

Lee: "But if you're saying that we know better now..."

Gasparino: "I don't know, I don't know, because Ken Lewis, remember, Ken Lewis there's a lot baked in about Ken Lewis, right, he screwed up a lot, right, he bought Merrill Lynch, didn't do the due diligence, remember there's a board change going on now..."

Lee: "Right."

Gasparino: "... a radical board change that's going on. I hear from inside Bank of America that they, you know, barring something coming out Andrew Cuomo's investigation into the losses, and, and bonuses that went on, whether they were disclosed properly, he's gonna stay around for a while no matter what, this maybe helps him, but you know, you never know. When you screw up as many times as he has, or he, so far, how many times can we count them, like 10, right, if you, one more, I believe puts you over the edge, especially when you have a changing board."

Lee: "All right. Chas, gotta leave it there. Thanks so much for coming in and joining us."

Gasparino: "All right."

Lee: "Pleasure to have you here on set, liiiiiiive."

Seymour: "You know we forgot to talk about Sallie Krawcheck, by the way, buying Bank of America shares. I think that was the bigger part of the rally today, I mean, this this is a very smart woman who's taken the job and probably knows better than Paulson does what this bank looks like, I thought that was impressive."

If there was a big winner out of this, it was Melissa Lee, who hit the daily double with Gasparino and Rick Santelli on Thursday. Lee not only has quickly proved to be the right host for Gasparino's reports — she's in synch with him, asks him great questions and keeps him on point — but also finally blew the whistle on Santelli's pit rambling, something we singled out yesterday (it's almost like the "Fast Money" folks are reading this site, but we won't quite take that leap), leading to this exchange Thursday before Gasparino's appearance:

"Rick, Rick, Rick, I need you, I need you to bring it down to the bottom line, in your markets, what do these theses mean for bonds, for the dollar, for the things that you follow."

"Oh, I think that the dollar's gonna have a tough time just because of all the medicine and the costs, I think interest rates will watch stocks, and if stocks go up they'll go up that much faster but ultimately they're going to go up anyway," Santelli said, again using five times as many words as needed but at least reaching a conclusion.

Lee looked great in her hour of power, though there could've been a fashion coordination miscue on the set given that both Lee and Karen Finerman (a day after her tour de force) were wearing orange. Guest Michelle Meyer of Barclays looked great in red and needs to be on the show more often. (She said she thinks the dollar will continue to weaken.)

[Wednesday, August 12, 2009]

Fast Money Review: Is it time
to be shorting Ben Bernanke?

Featuring: Karen Finerman | Melissa Lee | Peter Schiff | Guy Adami | Ben Bernanke | Joe Terranova | BAC | Pete Najarian | Charles Gasparino | John Paulson | Stan Druckenmiller | Phil Falcone | C | TOL | HD | Rick Santelli | BBY | RF | IBM | FCX

Karen Finerman was scorching hot Wednesday.

(Our usual disclaimer as to why sentences such as the above are appropriate for a business review that aims to be taken seriously: Successful television requires attractive people who look good, or else nobody watches and it's lights out.)

Melissa Lee otherwise would've won (going away) the fashion crown for the day with a neat vest ensemble, but faced with what K-Fine brought to the table, it just wasn't going to happen Wednesday.

OK. Now on to Peter Schiff and the gang. Lee introduced Wednesday's program as a "big, big show tonight" and singled out Schiff's appearance.

Maybe our expectations were too high, but Schiff this time was uninteresting. The "debate" was too general; it would've been better to take up something specific such as the dollar, although that happened two weeks ago when Tim Seymour did just that.

Once again, Schiff took part in the show's "Bull Market or BS" segment, "our favorite game here on the desk," as Lee put it.

Schiff first corrected Lee's description: "I'm not a permabear, I've just been bearish for a while ... for the right reasons," he said.

Guy Adami twice asked him what might be a decent question that Schiff didn't directly answer, but his indirect answer said enough that the panel should've quickly moved on. "At what point do you step in and say, you know what, I'm all in on the short side here in the S&P?" Adami asked.

"I'm not short. I'm not short anything, so I'm not all in," Schiff responded. "The reason we got into trouble is because of all the mistakes that Greenspan made, and all the mistakes that Bush and Congress made, well, everything that we've done under Bernanke, and what we've done under Obama is worse. ... The consequences are gonna be more disastrous for our economy and for our market. ... I'd rather be short the dollar, which I am," he added, explaining that nominal stock gains might be phony compared with activity in the dollar.

Adami asked him the same question twice, but Schiff's point indirectly was clear, he's not short the S&P right now, and while he didn't make this defense, we will; it's kind of hard to know in advance when you'd be willing to go all in on something.

Instead, the show lurched into a discussion of Ben Bernanke (a topic covered earlier by Rick Santelli) that was almost completely devoid of specifics.

"I'd like to see the government reverse course," Schiff said. "I'd like to change the policies ... your show is 'Fast Money,' but Ben Bernanke, his show is all about loose money, we need to put that to an end. You know, we need to raise interest rates, we need a realistic interest rate in this country, and I know he's saying that he's not gonna buy Treasurys any more, he's not telling the truth."

Joe Terranova, as he often does, did ask a very fine question, and while he and Schiff were interjecting comments, this was the gist of it: "Peter, go back to March then ... what has Ben Bernanke done that is incorrect? ... That was the right thing to do ... the market's telling you it was..."

Schiff said, "The market goes up and down, it doesn't tell you anything ... it went down first, and now it's going up. It will go down again." He continued on Bernanke's $300 billion plan, "He shouldn't have done that, and the economy has not improved ... we have dug ourselves into a deeper hole under Ben Bernanke ... we need less consumer spending, dramatically. We need less borrowing ... what we need is to allow the government to shrink ... he's let Congress off the hook. He should be reining in the government. ... forcing the government to cut spending."

Fortunately, Lee turned to scorching Karen Finerman for her own review of Bernanke. "Something had to be done," Karen said. "I think a lot of what Bernanke did makes sense to me." She said she also thinks Gentle Ben can still at some point rein in the credit, "a little bit."

Terranova said one reason the market keeps going up is conversations like this one, that "no one believes the move." Good point, except Guy Adami said just the opposite at the top of the show (we're getting to that). We've been saying now we think this market goes bust once "Fast Money" drops the "Bull Market or BS" segment, or at least finds someone to actually vote for "Bull Market."

Once again we take note that Schiff was professional and a fine guest, despite curious online comments by Dennis Gartman recently that Schiff can be hotheaded on TV. One reason might be that Schiff is apparently raising money for a possible Senate bid against Chris Dodd. Schiff is a 1987 grad of Cal-Berkeley, supports the Austrian School philosophy and worked for Lehman before launching Euro Pacific Capital in 1996.

So is the market going up or down?

"This is a very difficult tape," said Guy Adami, and frankly it doesn't seem that difficult to us, unless you've recently been long Huron Consulting or something. "I still think we're going lower, and it's really hard to have that view," he said, because so many people are pointing to a turnaround with better stats. "I feel it in my heart that the next big move is lower. ... I'm talking about 40 or 50 S&P points," he said.

So on the one hand, everybody believes in the rally, and on the other hand, nobody does.

Maybe Joe Terranova put it best: "Believe it or not, I think we're in no man's land here."

Melissa Lee talked of hearing panelists at some Charles Schwab function or other pointing to revenue growth as the next catalyst but according to Lee there's no immediate revenue growth on the horizon and thus she too sees sort of a "no man's land." More startling, she said, "There's no reason to move higher."

Karen Finerman (did we mention she was smoldering today?) again lamented what she sees as "divergence" between economy and stock performance. In other words, the economy just might not justify this rally, and "stocks might be fairly priced already. I can't get wildly bullish here."

We think Terranova might be on to something. (This writer is long AA, DTV and TBT and has no other positions.) "Again, what's the fundamental catalyst to take the market down?" Terranova asked. "It's gonna just have to be price action as Karen said, valuation."

We think he means Adami's fears of a pullback are unfounded because there's no negative news looming to punish stocks. But he might've also meant that because there are no bad fundamentals on the horizon, people will just sell because prices seem high.

Maybe.

Pete Najarian said today "really came down to volatility," and we tuned him out just about as fast as you did. Except it's our obligation to keep watching, so we report he said there was "2 to 1 puts to calls," and "protection's being put in place," which sometimes means everyone is bearish and sometimes means everyone's wildly bullish and buying protection so they don't have to rush out and dump shares. He later said the put buying means "they don't see this market tumbling over." So there you go.

K-Fine borrowed a Hal Holbrook line from "Wall Street" in discussing BAC, saying it's "back from the edge of the abyss." She said BAC "managed to step on nearly every land mine that was out there to be stepped on ... everything went wrong here," but after all of that, "the potential profitability here is enormous ... I like Bank of America."

We always look forward to Charles Gasparino's reports on "Fast Money" or any other CNBC program, and Wednesday he did not disappoint. Lee early in the show said, "Give credit where credit's due ... our on-air editor Charlie Gasparino broke this story of John Paulson picking up Bank of America shares."

A little later, Gasparino got on the phone line. Lee asked him, "Charlie, what do you know," and it gave us a sigh of relief that she didn't say "what have you got" (surf the Web to find out why that phrase was a problem).

In his response, Gasparino couldn't resist a dig at the more vocal Goldman Sachs critics:

"Uh, pretty amazing," Gasparino said of Paulson. "He bought a lot of stock ... he might be short every other banking stock except for these guys, (but this is a) pretty big bet ... This is the guy that famously went short financials, went short the subprime market ... back in 2006, 2007 ... John Paulson was one, a guy named Stan Druckenmiller, you might know him, was another, Phil Falcone was another, Goldman Sachs, you know, went, went short the market as well, they would say as a hedge; some people (that would be Matt Taibbi and certain bloggers) uh, uh draw other conclusions, frauds, for example, but we don't take those too seriously."

"But uh, now Paulson is turning around and buying a substantial stake in BofA," Gasparino continued, saying Paulson has 168,000,000 shares that right now give him a stake of $2.7 billion if his math is correct (the panel didn't say).

Melissa Lee, who has a lot of swagger in dealing with Gasparino and should be his regular host, asked a great question in limited time, is this a vote of confidence for Ken Lewis. Here, Gasparino went into storytelling mode, nearly preempting his point until Lee got him back on track, making some strange reference to an event from 2006-07 as a sign he is getting "old" and covering this type of news for so long, saying that Edward Lampert made an investment in Citigroup that might've bolstered Chuck Prince's position but in the end it didn't work for him, so Gasparino figures it might be a short-term boost for Lewis but no guarantee.

According to the New York Times, Lampert disclosed a $1.3 billion investment in C in August 2007. The Times wrote about this investment in November 2007, when C shares fetched $33.41.

Those were the days. The pre-Meredith days.

Stan Druckenmiller, by the way, nearly bought the Pittsburgh Steelers, but in the end it appears the NFL muscled together a below-market deal to keep the team in Dan Rooney's hands.

Gasparino's reports, however edgy, are well-received by this site because he brings a lot of life to CNBC as well as enormous journalistic savvy. The recent Financial Times profile (the Lance Armstrong story repeat is getting a little old, but whatever) made a compelling point, that he is among few journalists who have mastered the crossover into "new media," although in fairness he seems much more of a success as a TV personality (not the first time that's been done) than the second coming of Matt Drudge. We think enough of Gasparino's presence that we elevated him a while ago to No. 2 on our "CNBC star profiles" page, ahead of Maria Bartiromo and Erin Burnett (we've contemplated leapfrogging Cramer, but Cramer does have his own show, the most viewers, his own newspaper chops and continues to entertain).

Nevertheless (and we're not his agent and don't know him), he's not perfect. Wednesday was a good example. Too much storytelling, failing to get to what sounds like an interesting point in time. Also, while it's fine to insist on finishing a point, he should be more accommodating to colleagues' questions, some of which are pretty good. Of course, we also don't want him taking the edge off either ... kind of like a defensive end who gets flagged too often, you still need those sacks.

We've thought for a while, a good solution would be to give him his own show, although preparing for that might preempt the spontaneity and amount of his daily reports. Tough call there. Maybe he could guest host for Dennis Kneale one night and see how it goes.

Anyway, Karen Finerman (did we mention she looked great?) made a similar point as Gasparino, that "Here is one of, obviously, the biggest bears on financials" in Paulson suddenly taking a big stake in a bank seen as a barometer. However, everyone including Gasparino noted these are positions as of June 30 and nobody knows what's in the rest of his book.

Joe Terranova said it's not necessarily good news for Citigroup, which he called a "completely different animal than Bank of America."

Pete Najarian made a decent point, that "Bank of America's also a big bet on the consumer."

We really would prefer to not even cover the daily "Fast Money" appearance by Rick Santelli because it feels completely forced and scripted. Many days, we really don't know what his point is until we read the script at the bottom of the screen. Wednesday he went off on Ben Bernanke, saying he can't pull away the "punch bowl" in time. "I do believe that there's political issues here," Santelli said. Really? Politics involving a Fed appointment? Who knew? He decried Bernanke's "infomercials on CBS, '60 Minutes'." He said (we think he said) that Bernanke is splitting the middle between what he thinks the economy needs and what Obama wants him to do, which are not the same according to Santelli. He admits it's a "lot of tea-leaf reading" drawing him to speculation the White House would prefer to remove Bernanke. But Obama is "certainly not gonna put a pilot in there who's going to remove liquidity any faster than Mr. Ben. Maybe more dovish would actually be a positive," he said. And he also decried a Fed "punt on 3rd down."

Melissa Lee asked an obvious but still excellent question (see, she had a great day too and looked great), why if the market continues to rally so strongly would the White House risk preempting it by making a Fed change, and we don't know or recall Santelli's answer (we've already posted far too much of what he said anyway).

Honestly, purely theoretically, it seems like the Fed's actions can't continue without serious repercussions down the road. But Karen Finerman (who knows a lot more about these things than we do) thinks it's OK, and apparently so do all the people with money (i.e., the stock market).

Guy Adami talked about Toll Brothers (TOL), "I think the stock is way overextended," but there is also Home Depot in the housing space, "highest levels we've seen since the fall." Nevertheless, "I don't love it at these levels," but people shouldn't short it, "still have to play from the long side."

Pete Najarian called Regions Financial a "monster" in terms of option moves. He talked about heavy options activity in BBY (his "Final Trade," to get long) and said "stock was moving lower, yet they were buying the upside calls ... six times the open interest." The funny thing there is that the biggest Best Buy story on the Internet Wednesday concerned a mistaken ad offering a 52-inch TV for $9.99.

We noticed that even though Lee singled out Schwab as a sponsor, its ads haven't appeared on the "Fast Money Rapid Recap" videos at CNBC.com as they used to before the porn documentary fallout.

Terranova said to sell FCX as a "Final Trade," Adami said sell IBM, K-Fine said to buy BAC.

Peter Schiff back on ‘Fast Money’

According to program teasers during the day, Peter Schiff returns as a guest to "Fast Money" Wednesday afternoon.

Schiff, one of the most provocative "Fast Money" guests who also tends to bring out great questions from the panel, appeared on the show July 30 and engaged in a dollar debate with Tim Seymour. Schiff said "the trade is to get out of the U.S." and predicted doom for the dollar, saying its fall will erode gains investors think they are making.

We'll have a lengthy review of Schiff's appearance very late tonight or early tomorrow.

On the "Halftime Report" Wednesday, Tim Seymour said he thought the market might be rallying a few hours too early and he was concerned about the close. Jared Levy said "it's a little scary here" in terms of the potential for a market stumble. Dani Hughes, one of our favorites, said "this is a relief from yesterday, I think." She also used the term "unch" — "we know we're gonna see unch," from the Fed meeting, she said.

Patty Edwards, very bearish these days, did actually tout MSFT, saying, "It's almost like buying a bank that doesn't have the risk." She also made positive comments on Home Depot, except recently she's gone there and "there's been virtually no one in there."

Jon Najarian said "the action in LVS today is three times normal on the call side."

"I think we're long in the tooth in this financials rally," Seymour said.

[Tuesday, August 11, 2009]

Fast Money Review: Someone
tell Regis if LSI is going up

Featuring: Karen Finerman | Senator Kennedy | Regis Philbin | Joe Terranova | Melissa Lee | Bob Lutz | Tim Seymour | Guy Adami | Pete Najarian | AA | PFE | FCX | IBM | CAT | WYNN | LSI | UIS | General Motors | PC | TM | WFC | WDC | Heather Bellini | VMW | CRM | MSFT | AMAT | SLB | FLR | TIBX | GPS | TBT | SH | BGT | XRT | WMT | TGT | Brian Kelly | Patty Edwards

We could start with highlights of Regis Philbin Day on "Fast Money."

But it was Karen Finerman who stole the show.

She returned to the set in that snappy, updated mod-'70s figure-8 yellow-white dress that everyone likes so much. Then she delivered this thunderbolt:

"I think, honestly one of the things that could get it, this, back on track, health care reform that is, would be if Ted Kennedy were to die ... the sentiment around how much people love him ... and how important this is to him... Look, I'm just being..."

During this comment, someone (we think it was Tim Seymour) was heard uttering "Gracious!" But then Seymour and Melissa Lee circled the wagons. "Karen's being very serious about this," Seymour said. "He personifies health-care reform basically, and so that is why we're saying this," Lee explained.

A couple thoughts on this one:

1. We think K-Fine is probably right, except we think there is also a push to pass legislation while Senator Kennedy is alive. But hers is a bold, honest call, likely accurate, and we salute her for that.

2. What does that say about the government handling this legislation, which potentially could have a serious impact on 300 million people's lives, if its passage is deemed dependent on the death of a single person? CNBCfix is not a health-care professional, has no training in the field, is not an expert on costs and programs and won't begin to debate them, but rather evaluates business news and general news media. The conclusion from observing the nation's health-care discussion is that most people — not all, but most — do not wish to change their plan, other than complaining it costs too much, something they also say about college, cars, car repairs, day-care, the orthodontist, movie tickets, etc.; do not see a sudden impetus to change it, i.e., it's not like we have to give AIG $168 billion or Wall Street will collapse and we're all going to die; and that there are three reasons it is suddenly being ramrodded onto the public and congressional agenda right now while we're supposedly in the middle of Great Depression II, 1) it's to get its result, either watered-down irrelevant provisions or utter failure, out of the way for the 2010 elections, 2) Democrats might be at their peak political muscle for the extent of this administration in terms of numbers and momentum and will never have a better chance to pass something, and 3) With Robert Gates in place running the Iraq/Afghanistan status quo and Ben Bernanke likely to be reappointed, liberals need to be reassured something is actually going to change from the horrible policies of the George Bush era.

3. We have no idea if the show will catch any flak from K-Fine's comment ... but it probably would seem less insensitive if it didn't happen on the same day Eunice Shriver died.

Finerman said she is still concerned about the possibility of health-care legislation that is detrimental to stocks but conceded, "I sold my HMOs too early."

Regis Philbin, the subject of considerable chatter among the panelists a couple months ago when he apparently met some of them and told them he watched the show and was long Alcoa (this writer is long AA), finally made it onto the set and was practically given the key to the city.

Philbin isn't Joe Theismann, but he generally knows his stocks. He talked about Alcoa. "I think it's gonna stay up there, and it's gonna go a little more ... One of the few I have showing a profit," he said.

He went off on Pfizer, saying, "I'm so sick and tired of hearing about what a great pharmaceutical is, when is the stock gonna move?" Someone mumbled something about the divided and Philbin said "Baloney the dividend."

He called CNBC a "wonderful" channel and said "I have it on before I get on the air, and I have it on after I get on the air. Honest to God, every day." He also noted that he watches "beautiful Karen."

And stocks? "Right now I like FCX, and I like Caterpillar, and I had some Goldman Sachs, (but) I sold at a relatively low number ... and I had a little IBM too," he said. The show's online summary says he also likes WYNN, though he didn't mention that on TV.

He cracked us up when he tried to make the Guy Adami TV Face and failed miserably. "You ever see Adami on the camera. Scares me when you're home (sic)." Philbin hopefully reads this review, given that he always watches the show, and if so would know this site has been the leader in calling Adami's look the greatest poker face on television.

But more stocks. Somehow, incredibly, he's into Unisys. And don't tell Eric Bolling, but he's been averaging down into it. "My average (is now) down to 3.76," he said. "I'm through buying Unisys, but can it get back to 3.76?" Someone pointed out it's transformed its core business and someone also might want to buy it.

He also started referring to himself in third person while asking about LSI. The "logic" of his position might've escaped the traders, but for whatever reason Regis demanded an opinion on it throughout his 10-or-so minutes on the set. "Regis bought a ton of it ... my break-even point is 6.76," he said. Guy Adami responded, "Goldman Sachs has just put a 6 and a half dollar price target on it and I think it gets there."

That gave Karen Finerman a chance to make one of her tremendous points (told you she had a big day), that people should never ever fixate on their cost basis for a stock because it has zero bearing on where the stock is going. "It's irrelevant; it doesn't matter," she said.

After a break, Melissa Lee — who was charged up Tuesday and upped her game significantly after Monday's flat display of disinterest — announced, "You're watching live with Regis and Melissa Lee," although she found it a bit too funny.

Regis was given three "Millionaire"-style questions, one lifeline (Joe Terranova at home), and the opportunity to score an official "Fast Money" trader jacket (which we'd never heard of since the inception of the show and looked fairly cool) if he could just answer three questions.

1. What is the ticker symbol of Disney: A) D, B) DIS, C) DISN, D) WALT. Regis got it right, DIS.

2. Which publicly traded company owns the Hair Club for Men. A) Regis Corp. (RGS), B) Philbin Group (PHIL). C) P&G (PG), D) Najarian Inc. (NAJ). This was the toughest of the three, but only one answer made sense, and Regis nailed it, Regis Corp.

3. What's it called when the price of oil for future delivery exceeds "spot price"? A) Backwardation. B) Storage Trade. C) Contango. D) Tango & Cash. Tango & Cash was clever; storage trade was a little strange inclusion. Regis toyed with his Terranova lifeline while blurting out the correct answer, Contango. (Luckily he didn't have to ask Terranova "which one of these oil names is a high-beta trade?")

Regis was given the jacket and oddly enough, apparently a note from "Fast Money" that he wasn't supposed to open on the set and was for the walk home (maybe some UIS puts?). Regis accepted the coat and said, "If I put the jacket on will I know what to do with LIS (sic)?" Can't help him there, this writer once took a bath on LSI and won't go near it.

Regis was given the lone "Final Trade" and suggested profit-taking in FCX.

That out of the way, we can get back to K-Fine. GM vice chairman Bob Lutz took questions from the panel about the Chevrolet Volt and other matters. (Once again, Melissa Lee displayed trouble with a key part of cable TV news interviewing, avoiding that clumsy dead air when introducing the guest and saying hello and waiting for them or not waiting for them to say "thanks for having me on," etc.)

Lee first asked Lutz how well the Volt, starting at $40,000 would do against foreign rivals, including the Prius, which starts around $22,000.

"The rivals are nowhere near like the Chevrolet Volt," Lutz said, explaing it gets "40 miles purely electrically, and then shift seamlessly to an engine generator which will continually recharge the battery, and you can do another 300 miles." Lutz explained that, with a federal credit (see, taxpayers aren't done yet paying for General Motors), the price will come from around 40 to around 32 and a half." Oh, and he made clear it's not just a U.S. think, "let's not forget this ...this car is gonna be distributed worldwide."

Where it got a bit feisty is when K-Fine asked about cash for clunkers and the demand for imports and noted GM had just one car in the clunkers top 10 list. The gist of her question to Lutz: "Looks like a dramatic shift, at least in cash for clunkers, away from the Big 3."

"Boy, we're not seeing that," Lutz responded. In comparing "daily sales numbers versus our plan ... we're seeing a lot of demand for our vehicles, so I don't know where you're getting your information..."

Later he said, "If the Asians are eating share from Detroit, we're sure not seeing it, I, I wonder where you're getting your information..."

"Well, we'll forward it to you," Karen said.

No need to do that. Here's the article from USA Today. It says 55% of the sales are indeed foreign. But GM is the No. 1 single seller in the program, edging Toyota at 18.7% versus 17.9%.

We're rarely inclined, if ever, to rule against Finerman, but "dramatic shift" seems a bit strong. According to this handy-dandy chart from wsj.com (hurry up and read it for free before Murdoch starts charging you), GM leads year-to-date sales over Toyota, though not with quite the margin of last year. Lutz is no doubt overly optimistic, but his deflection of Karen's ominous-sounding question is probably semi-valid.

Tim Seymour offered a trade, not taking sides but saying one place Asia "has a big jump on us" is in lithium-ion batteries. "This is definitely the secret sauce," he said, suggesting Panasonic (PC) as a play on this, something we found interesting because we only know Panasonic for VCRs and DVD players. He rattled off Sanyo, Samsung, LG, saying "a lot of the Asian makers are well ahead on the lithium batteries."

Pete Najarian said, in a bit of a puzzler to us unless he was responding to our call yesterday for more mojo from Pete similar to his table-pounding coal names last year, "This really does play back to the coal names."

It's the sentence you're guaranteed to hear just about every day Guy Adami is on the set: "I think the market's headed lower." Tuesday, the evidence was the selloff in the last 15 minutes, which is a different last-minute reaction than we've seen recently. "Technicals point to this market moving lower," Adami said, and then Tim Seymour proceeded to take both sides, saying technicals aren't so bad and we're just back to a recent pre-report number, "and the volume was very light today," but at the same time like Guy says, anyone buying on the dip Tuesday was getting burned at the end.

Pete Najarian detected a "little bit of a return to panic in the marketplace."

Finerman said the market has been "so frothy" for weeks, if not since March, that a "little bit of retracement is really nothing at all ... I also think Congress being out of session is a positive thing," she said.

Melissa Lee noted Dick Bove's caution on financials as dragging on the banking stocks. Seymour sort of took both sides of this one. "Well I think we're giving them a little too much credit," noting other factors weighed on stocks, such as the FASB, CBO report, possibility of small midcaps needing to raise cash, but you know what, "Yeah, I think that's a decent call" anyway, he conceded, and said he would still point to JPMorgan as a bullish-looking stock.

Adami repeated a rumor he noted in the "Halftime Report."

"I am hearing from a couple people," he said. "Maybe there's another secondary coming for Wells Fargo ... I happen to think Wells Fargo is a short here ... I think the financials are a short here." We have no idea if he's right, but Melissa Lee said they have calls in to WFC.

Najarian noted "a lot of put-buying in Wells Fargo."

"That would be a negative actually if they did a secondary," Finerman said.

Heather Bellini of ISI showed up on set before Regis to express a decent amount of bullishness on the tech sector, explaining a lot of spending hasn't happened yet. "We're bullish for a budget flush in the second half," she said. That's one we hadn't heard before, "budget flush." Yuck.

Bellini suggested VMW, CRM and of course "don't forget Microsoft." Who could ever forget it.

Adami said at "Halftime" that "I think tech's a short here. He later talked about WDC as one he continues to like. And he said, "I think AMAT's its own story" and not tethered to the overall tech story. "I happen to like AMAT ... OK here," he said.

Melissa Lee asked if investors will see a boost in solar stocks after AMAT's results. "I think you do," said Tim Seymour. "We're not doing it in this country yet," he added, referring to solar cells.

Lee asked Finerman about Bill Ackman reducing his TGT stake. "I like Target, we own Target," K-Fine said. She first misspoke but clarified, saying she is short the XRT and going long WMT and TGT. "The P.E. that those specialty retailers trade at I think is absurd," she said, the latter word a change from her typical "ridiculous."

"My favorite retailer continues to be the Gap," said Guy Adami, but cautioning that GPS might've gotten a little ahead of itself. At "Halftime," Adami once again pointed to one of his favorite roller-coaster trades, SLB (it's now on the downslope again, apparently), and "Yeah, I think you can get short these oil-service names ... (but) then you're playing in the deep end of the pool." (As opposed to being in the shallow end with names like GS when it was $50 last year.)

Tim Seymour noted that BG is planning a "very dilutive offering," which is why it was down. Pete addressed one of his hot option picks, TIBX, falling 4 or 5% Tuesday, parsing the corporate terminology, noting the company said it's not looking for a buyer, which is different than no buyers seen available. At "Halftime" Pete said of FLR, "Maybe there's an opportunity here to get in."

Patty Edwards told "Halftime" viewers, "I'm actually short the entire market right now," and she's doing it with SH.

Brian Kelly said, "I'm long the TBT, which means I'm short the long end of the curve." (This writer is long TBT.)

[Monday, August 10, 2009]

Fast Money Review: ‘It’s a joke’
politicians are taking credit

Featuring: Tim Seymour | Guy Adami | AYI | Pete Najarian | Melissa Lee | Joe LaVorgna | 2s/10s | JPM | Rishi Narang | HFT | Dick Bove | C | Joe Terranova | F | Greg Troccoli | RIMM | oil | BKS | TCK | Brian Stutland | VIX | Jon Najarian | PCLN | TIBX

On the heels of Robert Shiller's dubious book-promoting performance last week, "Fast Money" on Monday didn't deliver any yuks about serious recession questions. We figure, if Laura Tyson and Robert Shiller are chuckling, then maybe Christina Romer, Austan Goolsbee, Jared Bernstein or Jason Furman would be downright giddy.

Doubts about the magnitude of the spring/summer stock rally were not going over too well with Tim Seymour.

Check that: He was more annoyed by certain political figures attaching themselves to the recovery.

This is "not your mother's recession," Seymour said, invoking a dreadful cliche, calling the S&P rise a "totally appropriate rally" without valid comparison to previous markets. But he said "I think it's a joke" and "nauseating" that the same guys who took office claiming everything was all the fault of the previous administration are now suddenly taking credit for market results. "We got a whole lot of that on Friday," he said.

No names here, no need to embarrass anyone.

Seymour said this is "not a bad place to be picking stocks," a contrast with his fellow panelists, namely Guy Adami, who seemingly just about every show for two months says something like "I feel like we go lower from here."

Is the tape headed lower? "I think it might," Adami said, saying "now is the time" to short Acuity Brands (AYI), a commercial real estate play. Adami pointed to a Nasdaq chart (crediting friends at Minyanville) showing 50% retracement "from the highs of 2007," and now we've once again "touched a trend line." In other words, you can get out of tech here, Adami said. However, he did point to one of his favorites, WDC, as a stock that seems to keep grinding higher.

One guy who interestingly brought a fairly bullish outlook to the show was Deutsche Bank mainstay Joe LaVorgna, who unlike other on-set guests tends to speak directly to the camera. LaVorgna on Monday was seeing things in threes.

First were the criteria for the Fed to embark on a rate-hike-raising path. LaVorgna said it would require 1) unemployment lower, 2) core inflation contained, and 3) job gains. His advice to the Fed was adopt the same statement as June and just change the date, "do no harm." Tim Seymour agreed, saying of the ZIRP — we realized that's the Zero Interest Rate Policy — it "would be a political nightmare if they change that."

On the subject of investments, LaVorgna offered "three macro trades," including 1) early stage cyclical stocks, 2) "be long 2's/10's," and 3) long the dollar.

Guy Adami (yep, no surprise) said, "I just fear the downside here." Tim Seymour said "I love JPMorgan here." LaVorgna even sounded a positive tone for commercial real estate, calling it the most widely expected disaster but suggesting "I think we could earn our way out of this problem."

Rishi Narang was the latest "Fast Money" guest (by phone) to discuss high-frequency trading. The handling of this subject on "Fast Money" has been dubious at best, people saying day after day that "flash trading is not the same thing as high-frequency trading," something Narang said Monday ("it's just not so"). So what is HFT, and what is "flash trading." Narang was the first guest to take a stab at least at the former. Narang said, "Most people would give you a different definition for high-frequency trading," but he views it as being in and out of a trade in the same day, not going home with a position. "It's day-trading with a computer," he said, which actually doesn't make much sense to us, because how does anyone trade without a computer these days, but whatever.

Of course, (we're pretty sure) Narang was really saying that the trading decisions are computer-generated as well as computer-executed, a point confirmed on the Wikipedia page we found on algorithmic trading. More interesting to us was the Wiki page on "flash trading" — which consists of one whole paragraph.

Narang made an interesting point about the decimalization of market prices affecting spreads to the betterment of Main Street. He drew a parallel to the 1/16th fractional spreads of old and said HFT provides liquidity to the marketplace, without which those fractional-size spreads could re-emerge.

Narang founded Telesis Capital in L.A. in 2005. He's got a degree in econ from Cal-Berkeley.

Dick Bove wasn't around, so we'll do some gloating for him. Bove on Friday, June 19, was mocked by Guy Adami and others on the "Fast Money" panel (this was the Matt Nesto episode) for having the audacity to upgrade Citigroup to buy and assigning a $4 price target, representing a 27% gain at the time. "Why should we believe him now," Adami grumbled, but Friday and Monday, C actually easily cleared $4, less than two months after Bove's call.

Joe Terranova, who recently has redefined "quiet" on the "Fast Money" set, described Monday as "kind of a nothing day" and reiterated a previous point about commodity inventories. "You need to see a shift from contango into backwardation," he said, and Tim Seymour challenged him on it slightly by pointing out how various materials performed Monday, but we still have no clue if what (as we sort of suspect) Terranova is really saying is that the tail is wagging the dog here, in other words, backwardation isn't going to spur a commodities rally but will happen if commodities continue to rally, or something like that, etc.

Terranova's "Final Trade" was the highly dazzling "time to buy the VIX." But he did reiterate he's short Ford and doesn't see any more near-term catalysts. He also said it's "time to move to the sidelines on the RIMM trade." He saved his strongest trade, curiously, for the "Halftime Report" in which he cited a "double top" in oil occurring June 30 ($73.38) and last week ($72.84) and said "short oil against those levels."

And oh yeah, he did talk briefly about Barnes & Noble (BKS) and said "run for cover."

Pete Najarian was introduced in one segment about "comeback" stocks as a guy who, as an ex-NFL player, "knows a thing or two about great comebacks." But all Pete really did was re-talk about a name he mentions virtually every day, TCK. "I don't think this thing's over yet," he said. "I agree with Pete. It's going higher," said Tim Seymour.

Actually, we doubt if Pete really knows anything about great comebacks. The 1987 Vikings might've had a comeback somewhere along the way but are mostly famous for two jaw-dropping, monster playoff blowouts of New Orleans and (incredibly) San Francisco in which they barely ever trailed. Then he played for Tampa Bay Yuccaneer teams that went 5-11 back to back.

We're treading lightly here because we don't want Pete to sack us, or blitz us, or clothesline us, or shoot the gap or show blitz but drop into coverage, etc. But Pete seriously needs to recapture the mojo of last year. Right now you could say he's not having a good camp. Too many of his recommendations are heavy-option-activity doings in which the decent money's already been made.

Where Pete was king was the coal story of 2008. For many people those things kind of came out of nowhere, and Pete was at the forefront. Then, his "Fast Money" chatter at the top of the show was must-see for months. Then the market went cold, everyone's enthusiasm waned, and for Pete it hasn't quite warmed up since. You'd think, OK, maybe coal's now a market perform ... at least Pete can fall back on biotech. But other than perhaps TEVA, those recommendations have been sporadic and short-lived. Unfortunately he wasn't out there talking about Human Genome Sciences a couple months ago. But then again, who was?

Pete did pound the table on Tibco (TIBX), pointing to 13,000 September 10 calls changing hands. And he said RIMM was a buy at $70 for his "Final Trade."

Greg Troccoli did double-duty, showing up in Englewood Cliffs for the "Halftime Report" in which he refreshingly admitted a losing trade Friday, then doing the weather charts that he is pretty good at on the regular show and mentioning "two big figures of profit under my belt" from trades in the euro Friday. So modesty giveth, and taketh away. He did preface his sell-euro at 1.44 call with "I got a little lucky here." In the big picture, he used a 21-day moving average chart to show the S&P is not wildly overbought but could correct into the 970 or 965 range.

Troccoli seconded an opinion of Joe Terranova on RIMM, only with more oomph: "I would outright short the stock," he said.

Brian Stutland talked about the VIX and said he wasn't necessarily buying the recent trading pattern and it all basically put us to sleep.

Jon Najarian said at "Halftime" that Priceline is a great story, but at this point people need to give it a rest and take some profits.

Tim Seymour twice ("Halftime" and real show) mentioned the "great data" from Europe last week; this time it was exports in Germany.

Melissa Lee did not deliver her most inspired performance Monday. About halfway through the real show, she looked downright unhappy as the camera took its time cutting to a commercial break. On the "Halftime Report" she cited apparent skepticism from some pros that the summer rally is being fueled by "low-quality" names, which we sort of interpret as synonymous with "short-covering." Are AAPL, FCX, PCLN, CHL, AMGN, low-quality names? (We tend to think the rally is intact until "Fast Money" stops doing the "Bull Market or B.S.?" segment, but that's another topic.)

Zach Karabell disagreed with Lee's dubious question, saying "I'm a little skeptical of the comment about low-quality."

[Friday, August 7, 2009]

Fast Money Review: Shiller says
‘you never know’ about recession

Featuring: John Harwood | Tim Seymour | Joe Terranova | Melissa Lee | Steve Grasso | Pete Najarian | Carter Worth | DISH | Greg Troccoli | Robert Shiller | George Akerlof | TXT | WMT | TGT | MSFT | AMAT | CY | SPWRA

When famous economists laugh at serious questions, you tend to get the impression things aren't really that bad.

Robert Shiller, sometimes a fine guest with Larry Kudlow, sounded like he had no idea what he was doing on "Fast Money" Friday.

Melissa Lee asked Shiller, "Can we say that we've seen the worst for this recession?" Shiller replied, "Well we can hope that we have (laughs); I, you, uh, you never know."

Now there's pinpoint analysis from someone deemed "a good bet" to become a Nobel laureate. Our guess is the answer to Lee's question is "yes," or Shiller wouldn't be laughing about it. Interestingly, this response of his does not appear on the CNBC.com show summary. "We have a lot of work to do," he added, saying we shouldn't get "complacent," whatever that means (more stimulus or cash for clunkers?) as though there are times when people should get complacent. But he didn't hesitate early to mention one of his projects. "I think we have to overhaul our capitalist economy. I wrote a book about that." Sounds like a must-have for the typical "Fast Money" viewer.

The book in question is called Animal Spirits (and several other words after the colon) and is co-written by George Akerlof. John Lanchester of the New Yorker apparently said "there is barely a page without a fascinating fact or insight." Nobel laureate Robert M. Solow calls it a "sorely needed corrective." Paul Kedrosky (who by the way is a guy who told Melissa Francis' "On the Money" circa 2006 that GOOG in a year or two would be $1,000) says "highly recommended," according to mini-reviews posted at Amazon.com.

We consulted the April review by Louis Uchitelle that ran in the New York Times (you know, the Sunday Books section you can be "fluent in" according to those cable TV commercials featuring the pompous chap who makes a curious boast). Uchitelle writes, "Akerlof and Shiller ... are concerned that once we enter a revival, pressure will inevitably build — just as it did in the late 1970s, more than a generation after the Great Depression — to give the markets free rein again. Akerlof and Shiller intend their book as an obstacle to that ever happening."

Uchitelle praises the authors for breaking new ground in behavioral economics (kind of a redundant term) because in Uchitelle's mind, "There was nothing rational, well ­informed or unemotional about the behavior that has all but collapsed the economy."

Where to object first ... let's start with "all but collapsed the economy," an economy that may be slumping greatly but still manages to drive smartphone shares and Amazon.com stock through the roof; a collapse so serious that both Robert Shiller and Laura Tyson chuckle at questions about the recovery on national television. The definition of "collapsed" sure has come a long way since the 1930s. We know in fact there are smart people on "Fast Money" who agree with this assessment because they said it before this site did.

Then we see there is "nothing rational (or) well informed" about decisions people made. Actually, the economic behavior was completely rational and astoundingly well-informed — um, home prices are going up; might want to buy — and no different than economic decisions people always make, including right now: They invest in something because they think someone will pay them more for it than what they paid. That's what a lot of people did for a long time in housing ... and what a lot of people have done recently with Freeport McMoran. So under this theory, shouldn't the government step in to minimize FCX, AAPL and GS recent price moves?

The sloganeering in Uchitelle's review only gets worse. He continues: "Animal spirits are human emotions; they can’t be turned off. Unchecked, they drive the economy into misbegotten booms and disastrous busts. Tempered by government, on the other hand, they are a great source of entrepreneurial energy, safely channeled into a healthy capitalism."

Quick definition check: We were curious about "misbegotten." When you track down the roots of begotten, beget, etc., in Webster's, you get something like "wrongly or unlawfully brought into being, specifically born out of wedlock."

What exactly is a "boom" that is born out of wedlock or "wrongly or unlawfully" brought into being? A tech stock with no earnings yet that goes up 20% in a month? What do you do, arrest the underwriters of the IPO? How about coal shares that double in six months on anticipated Chinese demand? Houses selling for 15% more than last year?

Sigh. Apparently we're led to believe that after a period of rationality and real economic progress, somehow our "animal spirits" collectively got the best of us just when we had a fluke Republican administration that would help us out by easing financial regulation and we all made non-rational, not-well-informed financial decisions, and if only we were tempered by our government, we would have "healthy" capitalism. Actually, government is the outgrowth of societal behavior, not the cause of it. Economics is merely the measurement of societal behavior and also not the cause of it.

You can put five guys on a basketball court and get five other guys to play them, and you can force them to play whatever way you want, zone defense, five fouls, six fouls, fast-break, slow-break, box and one, triangle and two, zone press, pick and roll, slowdown, showtime, you name it, doesn't matter, the team with the better players is going to win basically every time. Likewise, people are going to do what they're going to do, and they will assign a government — which is in the business legislatively of always fighting the last societal problem and not the next — that reflects whatever the latest prevailing notion is, not the other way around.

One wonders how Shiller, Akerlof and Uchitelle would describe the executive behavior behind the crumbling of the New York Times (and other newspaper giants) ... lax government regulation allowing them to focus too much on, what, print delivery for too many years, too much irrational exuberance on paper and ink and foreign bureaus and sending three reporters to the Super Bowl, all at the expense of focusing on the Internet back in the 1990s, because if they had, and if the government had just "tempered" their animal spirts, they surely would've enacted a (insert fantasy term here) strategy and foresaw the bubble in print and not done things like purchase the Boston Globe or the L.A. Times or the Star-Tribune, etc., and nowadays would be enjoying a "healthy capitalism" of their daily printed newspaper. And if NYT execs were not irrational, and lax government oversight was not the cause of the stock trickling below $5, then what was?

We also wonder, if Shiller and Akerlof have the keys to our societal success, why don't they run for office and prove it?

Back to "Fast Money." Shiller said you can talk about housing starts, new construction, etc., but "The most important thing is home prices." Fine. But when it comes to a bottom, "you never know."

Shiller was addressed as "Professor" by Melissa Lee, Joe Terranova and Tim Seymour, a departure from the "Dr. Tyson" we heard for Laura Tyson, who on July 10 also chuckled at a "Fast Money" question on banking liquidity.

Unlike Shiller's interview, the appearance by political insider John Harwood stoked some emotion on the set.

Tim Seymour seemed to think the White House was getting a few more cheers than it should, and demanded to know why.

"What do you give them credit for, because I don't think they should be taking much here," Seymour said.

Harwood, who said Obama might be feeling something of a "sugar high," responded that back in February, people were accusing the new administration of sinking the stock market by raising tax and debt fears, and since the Dow has exploded since March, those people are making the opposite claim. He also said if the rally is based on health care legislation dying, then that rally is mistaken.

Joe Terranova spoke of L's, U's, V's and W's and offered, "Obama controls what the letter of the recovery will be."

"Wow," said Melissa Lee, and, um, that was "wow" in a far more skeptical than impressed tone.

Few subjects are more uninteresting on CNBC than chatter about the jobs report before it is released. Afterwards, it is comatose television material. One wise economist about a year ago, we think it was Joe LaVorgna but aren't sure, might've been Mike Darda, noted on "Fast Money" that other than for maybe an hour on the Friday in question, the jobs number isn't really tradable. Nevertheless, our "Fast Money" crew took up the subject Friday. The numbers show a "further postponement of layoffs," according to Joe Terranova, a positive sign. Tim Seymour said in the big picture, "the data everywhere (yeah, we know, he's talking about data again) is getting better," and Japan looks like the "high-beta play" for those anticipating a robust recovery. Pete Najarian once again spoke about the VIX, a subject we have basically tuned out for weeks now.

Traders did share an interesting round-robin on Wal-Mart. Steve Grasso and Pete Najarian are both in the pro-WMT camp. Joe Terranova said he prefers TGT. Tim Seymour sounded skeptical of WMT. The boldest call on WMT has been by Greg Troccoli, although he softened his $35 target to "low 40s" this week.

We took note that in the intro, Lee said the show would be hearing from its "favorite chart expert."

And that really made us wonder. Who would it be? Carter Worth? Greg Troccoli? Dan Fitzpatrick (apparently on sabbatical)? John Roque? Louise Yamada?

Actually, our gut feeling, given the recent airtime, is that it would be Troccoli.

It wasn't. It was Worth, who in recent months has looked more like he'd rather be serving beers to Skip Gates and James Crowley than doing segments on "Fast Money."

"The presumption is a lot of fuel has been spent here," Worth said. He said the rally has been "basically too steep" and that stock buyers should "want it to be orderly, deliberate and measured." But then he singled out a group he says has lagged and is due for a gain: cable providers. He specifically rattled off DISH, Cablevision and Liberty — all of which are great, unless you happen to own (as this writer does) DTV. Worth illustrated DISH's chart and said "this is how stocks bottom."

Pete Najarian said Textron (TXT) had an "unbelievable amount of call-buying."

Apparently "Fast Money" needed filler to complete an episode, so Jim Goldman stood outside a California solar company that is not publicly traded (Solyndra) and talked about how California has initiatives of some kind that might be good for AMAT, CY, SPWRA, even as Pete Najarian pointed out these are long-term endeavors.

Joe Terranova said, "You can Fast Fire me every week; I'm not getting out of Microsoft."

[Thursday, August 6, 2009]

Fast Money Review: Murdoch
is charging the wrong people

Featuring: David Joyce | Rupert Murdoch | Guy Adami | Zachary Karabell | NWS | Charles Gasparino | John Mack | Doug Kass | MS | WFC | Tim Seymour | Pete Najarian | Joe Terranova | Eric Schiffer | NDN | Richard Gelfond | IMAX | David Rosenberg | CSCO | JOYG | Rick Santelli | Greg Troccoli | Jeff Tomasulo | Steve Grasso | Bill Griffeth | Shia LaBeouf | Mary Thompson

Day 2 of charging for nypost.com, this time starring analyst David Joyce of Miller Tabak.

"If you don't, uh, get consumers used to paying for useful content again, you're not gonna have any useful content," Joyce said on "Fast Money" Thursday.

Never has the word "useful" cried out so much to be defined.

Box scores and stock quotes are useful. Forget about charging people to read them, those days are over.

Opinions on Eli Manning, Eliot Spitzer, Goldman Sachs and "Cats" are also (in some cases) useful, if only for entertainment purposes. Forget about charging for those too.

Joyce only got to offer a couple comments, so it's probably not his fault, but this was another decline-of-print-media conversation so lacking in details, it was pointless.

Over two days, no one on "Fast Money" has pointed out that online readers do in fact "pay" to read newspaper Web sites — they're paying for their computer (desktop, laptop, smartphone, etc.), and they're paying an ISP for monthly access.

Charging those people fees above that to access sites they're already viewing seems an extremely limited prospect.

It'd be like going to a movie theater, buying a $10 ticket just to walk in the door, then having to fork out a couple extra dollars to see "Away We Go." Or like buying your TV and cable service, then having to still pay Melissa Lee $2 for every episode of "Fast Money" you watch. (That concept would bankrupt this site in a hurry.)

Joyce said "News Corp is really taking the lead" in getting readers to pay. News Corp is not taking the lead in jack except overpaying a ghastly amount for a trophy media property. Murdoch is fiddling while Rome burns. The visionary approach for News Corp would be to cut a deal with the names like RIM, AT&T, Comcast, etc., the same way ESPN, CNN, NFL Network and cable channels do. As individual entities, papers have little leverage. Research in Motion might say "we don't care if our users can get the New York Times online or not." But if every daily paper, a bunch of mags, CNN, CNBC, the Associated Press, the WSJ, Wikipedia, TMZ.com, etc., united as one lobby, told Comcast you have to pay us a percentage of your users that visit our sites, then there might be a future.

CNBCfix opinion: Even not-so-prideful newspaper staffers famously want nothing to do with a government bailout. If they're all about to go under, that sentiment might change. The belief here is that the government will accept without consequence newly formed 1-paper towns such as Denver or Seattle, but not zero-paper towns, and if/when that scenario looms, politicians will step in. The question is, how to do it and keep the paper out of the control of the government. The paragraph above would be one way, employing government leverage against ISPs, whether through legislation or other ways, to accept such a fee-based arrangement.

That does not address the cost problem of delivery of a paper product. That might sadly be unsustainable. But there might be hope of preserving journalism at the highest levels, delivered online, by experts paid well enough to make a living doing so.

Melissa Lee questioned a couple of times if the genie is already out of the bottle, and Guy Adami basically agreed in regard to News Corp. "I don't see how it works," he said, explaining he reads nypost.com, but "there's no way I'm gonna start payin'." Unfortunately Zach Karabell, who is a deep thinker on these and other matters and started the subject yesterday, wasn't on to discuss.

We wondered what else Joyce might've had to say outside of "Fast Money." He was quoted Thursday in the New York Times, saying News Corp's general results reaffirmed "the general notion that the other media conglomerates have reiterated over the past week that the worst is behind us."

Joyce, like Guy Adami and Tim Seymour and Steve Cortes, attended Georgetown, with a B.S. in business administration. He also has an MBA in finance from NYU.

We also caught a bit of this discussion (again, woefully lacking in depth) on "Power Lunch." Bill Griffeth, whose opinions we always want to hear, said WSJ.com has been a "leader in being able to charge." Dennis Kneale said maybe so, but for a "broad publication, forget it." Michelle Caruso-Cabrera insisted that people will want quality journalism and eventually they'll pay for it. Curiously, Rebecca Jarvis, despite the fact her mother writes for old media (Chicago Tribune) and despite wearing a stunning black-white outfit, had nothing to offer on this subject.

Charles Gasparino, notably casual with open collar, made another appearance on "Fast Money" with an update on John Mack. (It may be risky these days for a Web site to mention Dennis Kneale and Charles Gasparino in the same posting, but we think CNBCfix is safe from an on-air condemnation.) He said, "There is talk inside Morgan Stanley ... at the top levels ... that John is likely ... to turn over the CEO role" to James Gorman, with an announcement this year and transition in 2010.

Then Gasparino might've gotten a little bit more than he bargained for ... from Melissa Lee.

Lee waded into CG with some swagger, cutting him off a couple times to say that John Mack may be doing it right in some ways, but not doing so right for shareholders. This was something this site speculated about a couple weeks ago, though Pete Najarian defended MS' performance in relation to GS, which we agree is not terribly out of line. Gasparino said at least Mack was doing the right thing with taxpayer money, not the "scandal" of leveraging it for trades as Goldman and others successfully performed, the centerpiece of Gasparino's ongoing GS criticism while he defends it from more circumstantial theories.

Gasparino's reporting during his CNBC tenure suggests he has some — key word, "some," not saying "all" — of the same opinions toward high finance exhibited in Oliver Stone's "Wall Street." A dominant viewpoint of the film (reviewed very deeply on this site, one of our most popular features) is that the system is so loaded with wealth it invites vultures and parasites to exploit it for quick, in many cases legal, financial gains while providing no societal benefit. Gasparino is likely most impressed by Wall Streeters who tell him things they probably shouldn't tell him. But underneath that, he seems less impressed by guys getting rich than guys (who attempt to be) getting it right. And that's not a bad thing.

A question from Tim Seymour was abbreviated and ultimately not much of a question at all. Gasparino didn't mention it on "Fast Money," but on "Power Lunch" (with an excellent jacket on) and other segments in the last two days, Gasparino credited Doug Kass, one of his favorite bloggers, for (we think) essentially breaking this story. "That story was essentially accurate," Gasparino said.

Eric Schiffer, CEO of 99 Cents Only Stores, told Melissa Lee that times likes these are good for "transaction count." He added, "For us, the toughest thing has always been to get an upscale, affluent customer to try our store for the first time." Will people who downscaled into his stores during this recession stick around when it's over? Guy Adami was skeptical, but Schiffer said "the company's best store, historically," is on Wilshire Boulevard. (Maybe Chris Thornberg shops there.) So there you go.

Schiffer has been with NDN since 1991 and CEO since 2005. He's got a B.S. in engineering from Duke and an MBA from Harvard.

IMAX co-chief Richard Gelfond discussed his business model in terms of cable TV; "like an HBO," requiring a fixed-cost investment, and now his company is at the point to "finally have enough theaters where we can get the really good movies." Tim Seymour asked about expansion outside of North America and the answer was humdrum. Jon Najarian is the real champion of this company and he wasn't around, but the most interesting comment came during the "Final Trade," when Pete Najarian said IMAX is expanding into India (which makes you wonder why they hadn't tried that sooner, given that, you know, they've got something called "Bollywood" over there that is fairly popular). Seymour was heard to crack, "Oh, another area he wants to expand into," and then smirked, and we don't really know what that was about, so we'll let it go.

David Rosenberg, who in his last appearance talked of the "mother of all jobless recoveries" whenever Melissa Lee stopped making crystal ball jokes, was so middle-of-the-road this time we wonder why he came on. He said first the market was priced for "armageddon," now it's "priced for nirvana," and the truth is somewhere in the middle. Asked about cash for clunkers, he declared "it's not a good thing or it's a bad thing." He said if you're looking for a thrill ride, consider BAA bonds. (OK, that was a joke, he didn't say the first part of that sentence.)

Guy Adami kicked off the show with a little warning about a "double-top" in the S&P 500. "The thousand and five level was the same top we basically made in November 08," he said.

And of course, that head-and-shoulders pattern a few weeks ago was going to be the death knell, as was that flimsy 870 number.

Adami identified an opportunity in WFC. "Trade sets up very easily to me," he said. "That 29 and a half level is your stop ... I get short Wells Fargo here" and look for 27.

Tim Seymour mentioned the dreaded (and we really mean dreaded) "mixed data." We've regularly commended Seymour for preparation, but this is one area where it doesn't do any good to recite the pros and cons of various stats. It's a TV show. Just tell the viewer what they should do, what you did after all that you heard.

Melissa Lee followed with the even more confounding "new leadership" theory, the idea that financials somehow apparently have been leading for so long (about four months in the most generous assessment) that the market can't truly rally unless something else that has been leading for less time than that replaces them. Seymour and someone else essentially scoffed, and good for them.

Lee was a lot funnier when she suggested Cisco's apparent venture into television sets is "sort of like jumping the shark," a favorite line of previous "Fast Money" host Dylan Ratigan.

Rick Santelli, now a regular guest on "Fast Money," said whisper numbers for the jobless report were creeping into the upper 200s. Tim Seymour said nobody will care if the number is unexpectedly high because other data points suggest an improving landscape. Guy Adami said though that the jobless number is now sort of a leading indicator because it affects consumer perception. Steve Grasso said on "Power Lunch" that pros think the "rally intact" if the number is "south of 350" or 9.7% unemployment.

Pete Najarian made JOYG his "slow money" trade (hint: many of these "slow money" trades are the same stocks recommended by the same panelists at other times during regular "Fast Money") because, in part, "plenty of room still to the upside."

Guy Adami spoke about Limited Brands while Lee ran Victoria's Secret fashion show footage, something that never happens on "Fast Money."

Shia LaBeouf is apparently carrying a copy of David Faber's And the Roof Caved In around New York in preparation for "Money Never Sleeps." LaBeouf should consider our review of "Wall Street" and perhaps take a quick look at our comprehensive review of Caved.

Traders on the "Fast Money Halftime Report" weren't exactly shy about pointing out some recent successes.

Jeff Tomasulo, for example, said AIG has become a great thing for day-trading, even if it requires praying to the trading gods; in fact, "our desk made a lot of money yesterday."

Greg Troccoli referred to possible resistance around S&P 1,000 and said "I called it a couple of weeks ago ... 1,000 was a psychological level."

Jared Levy was a little more modest, saying AIG still has massive debt, and maybe what's happening with some financials is the result of government meddling with naked shorts. Troccoli, who on July 27 said of WMT, "I think this stock goes to 35," is still down on the stock, but now only in the "low $40s" level. Tomasulo delivered the ultimate in if-then scenarios, pointing to "consolidating" names such as RIMM and IBM and saying, "If they hold above their key levels and resume their uptrend," the S&P can thrive "over the 1,000 mark."

Mary Thompson might've bested Rebecca Jarvis for best outfit of the day, appearing in enchanting white sleeveless dress and large hoop earrings on the CNBC.com "News Now" introducing "Fast Money."

[Wednesday, August 5, 2009]

Fast Money Review: Murdoch
saves journalism from readership

Featuring: Rupert Murdoch | Zach Karabell | NWS | Karen Finerman | Melissa Lee | Pete Najarian | Guy Adami | Joe Terranova | WFMI | BX | FIG | F | TM | PAC | Nicholas DeBenedictis | WTR | Anthony Zinni | LLL | Mark Axelowitz | Jon Najarian | GS | Dani Hughes | CSCO

Thank goodness for Rupert Murdoch — about 50 minutes into "Fast Money," we were afraid we'd have to lead today's review with something about the tone of Cisco CEO John Chambers' comments on the earnings ... conference ... call ... (Zzzzzzzzzzzzzzzz) ...

But then Zach Karabell stepped up to the plate in "Trading Before Dark" (or is it "Trading After Dark"? We can never keep that straight) and briefly handled a subject that should've been given at least 30 minutes.

The issue was News Corp. as an investment vehicle. The important discussion, consisting of about 15 total seconds of airtime, centered on Murdoch's announcement that he's going to start charging for all of his Web site access.

Karabell had this to offer: "They've been the only one, at least with the Wall Street Journal, to actually make money charging for content online."

This statement deserves a massive amount of context that was not allowed to happen.

First, for basically all established newspapers and media companies, online revenue is found money. The worst businessperson running a newspaper will "make money" online, charging for site access or not, because virtually all of the costs of the product have already been absorbed under the print umbrella. It's the equivalent of airing a "Diff'rent Strokes" rerun — basically complete revenue gravy; you're not paying Gary Coleman or Todd Bridges or Dana Plato anymore (maybe a residual or something, but no need to go there).

What WSJ.com has not done — and nobody else in daily newspaper media has done — is produce any kind of online-journalism model that can sustain the type of journalism that still exists in print that Murdoch covets. That means hundreds of people, able to make a living at this profession, undergoing training for years, many devoting their college years to J-school programs at elite universities. WSJ.com can do or add things that print can't do very well (unlimited space, charts, links to related/previous stories, etc.), but the salaries of those names producing the material are supported by the paper thing.

There are a smattering of Web "news" operations — maybe more than a smattering — that are self-sustainable or appear to be self-sustainable or mildly profitable. But this is niche, highly specific material (one favorite: college basketball recruiting blogs), usually produced by a handful of people or less in a very low-cost environment (kind of like CNBCfix.com, which makes zero money at the moment). The chances of a media behemoth such as News Corp. protecting its existing, prodigious newsgathering operations by charging Web site fees seems ludicrous.

If Murdoch's people are spending serious hours analyzing competing revenue models of free vs. subscriptions, that is a colossal waste of time. Here's the bigger issue: relevance. If ordinary folks aren't seeing your site, you're fading away. This is a hugely understated point, about why newspapers continue to shovel their product out on the Web for free at the risk of further cannibalizing their print editions: It makes you far more relevant to have it out there than not have it out there. So we have some kind of quirky Catch-22, maybe a Catch-22 tripod, of liking the found money online, wanting the additional relevance from a global 24/7 readership, and desperately needing the print operation to remain just like the old days to sustain it all. Kind of like a restaurant handing out free meals on the sidewalk and reaching far more of the masses but not getting enough of them to come inside and pay the old way ... and not sure there will ever be enough of those customers again. By turning to fee-only sites, Murdoch likely would only get an immaterial boost on the NWS balance sheet while delivering a serious headwind to the Journal's long-term relevance.

By the way, it was two years ago, Aug. 8, 2007, when Murdoch during the same earnings call broached the subject of dropping the WSJ's online subscription fee. "I think it would be an expensive thing to do in the short-term. In the long-term it may be a wonderful thing to do," he said, according to this BusinessWeek article by Catherine Holahan dated Aug. 10, 2007.

Anything, we're not arguing with Karabell's comment, only that there is so much more to be said about this subject that obviously wasn't brought up in this ridiculously brief segment.

On the subject of News Corp., Karabell said, "I think you use News Corp. as an interesting read into other sectors," but he's not very interested in the shares. Karabell might be the funniest guy on "Fast Money" because of his intellectual humor, which we've noted recently, but his "trading before thunderstorms" joke in this segment needs work.

Pete Najarian actually said something good about Whole Foods. Karen Finerman said, "Let's talk about it some more." Karen's investment in WFMI is so famous that we even heard Erin Burnett referencing it during Street Signs, though we could swear Burnett had it reversed and said something like Karen was probably profiting from the big gain.

There was a little more talk about cash for clunkers. Melissa Lee asked, "Big question that I have though guys, are we just selling cars now so we won't sell cars later on?"

"Yes," Finerman said.

"It's voodoo economics," Rick Santelli said.

Joe Terranova boasted (more or less) about being short F and TM: "They can't go up anymore," he said.

Tim Seymour might argue that point, but he was off.

Guy Adami was skeptical on a lot of stock prices (notice we didn't say skeptical on the companies, just the prices, as Adami is always careful to note), namely IBM, INTC, CSCO, MA, F, etc. But he did say BX "looks interesting" at "14 and a half" or better, and he likes that one better than FIG (that was a dog that CNBCfix owned a few months ago when traders raved about it, thank you very little).

Finerman made an interesting "slow money" trade that seem like it might work for "fast money." It's Mexican airport operator PAC. "They own four of the top 10, uh, busiest airports in Mexico," she said. PAC makes money from landing fees, passenger fees, cargo fees and airport retail. She called it a "superb" balance sheet and said she likes the swine flu overhang and economic malaise that sank the stock earlier this year. It's now doing much better.

Nicholas DeBenedictis, CEO of Aqua America (WTR), failed to make a splash on the subject of water. So maybe the stock is another stimulus play, "We're actually spending more this year than we ever have," he said, saying the number is $300 million and "quite a bit of it through stimulus funds," zzzzzzz. Joe Terranova said, "I've gotten burned doing these water trades before."

DeBenedictis is a Philadelphia guy with a bachelor's in business from Drexel and a master's in environmental engineering and science, also from Drexel. He's even got an honorary degree from Widener. He's been CEO of WTR since 1992.

Mark Axelowitz of Smith Barney took part in an awkward, very brief segment on what super-rich people are doing with their money. Something wasn't quite right here, like Axelowitz perhaps was expecting a different topic, etc. Anyway, he basically said his clients last year "got very conservative, went into fixed income" and tried some bonds and more conservative things. More interestingly, we found that Axelowitz jumped from Morgan Stanley to Smith Barney recently, and according to one article, "pops up in the people pages of the New York Post and rubs elbows with the likes of Tom Brokaw, Harvey Weinstein, and Gwyneth Paltrow." Gwyneth might've rated this episode the equivalent of "Bounce," but there could always be a "Shakespeare in Love" next time.

Gen. Anthony Zinni came on for no reason we could discern, except he's got a book to hawk. Oh, so because he's CEO of BAE he could talk about defense contracting potential, but he said it's probably a "flat budget" despite the "quadrennial defense review" coming up. Guy Adami said to take a look at LLL and pointed to cybersecurity.

Pete Najarian said the exciting thing about M&A in the fertilizer space is that the companies "clearly think they're too cheap." K-Fine said "I'm a little skeptical of that Deutsche Bank" prediction of 48% of mortgages underwater in 2011.

Joe Terranova said "Bubba has a lot of pops."

For "Final Trades," Terranova said to short WYNN, Adami said look at JCI, Finerman said FLIR, and Najarian offered SYNA.

In a sign that Michelle Caruso-Cabrera's thunderbolt to the "Fast Money" stage last week is still reverberating, Jon Najarian three times called Melissa Lee "Michelle" during the "Halftime Report," which then became a repeat inside joke on the 5 p.m. show.

Dr. J also (sort of) elevated himself to the level of a certain premier financial institution: "I've said all year this is the best market for traders ever. Goldman Sachs proves that out day in, day out. I'd like to think that I do as well."

Dani Hughes resurfaced on the "Halftime Report" also.

John Chambers apparently said he needs to see several more quarters of activity to know if the bottom is really in.

[Tuesday, August 4, 2009]

Fast Money Review: Anyone
heard that jobless number yet?

Featuring: Carter Worth | Dan Fitzpatrick | MET | Melissa Lee | Karen Finerman | Pete Najarian | Steve Grasso | Joe Terranova | WFMI | CTX | RIMM | AMZN | Mark McKechnie | CSCO | Richard Repetto | CME | ICE | BAC | TCK | CAL | ANN | Brian Overby | Rick Santelli | ABT | WFC | PDE | DTV | Dennis Gartman | CAT

Normally we don't like to open on a negative. But Carter Worth, in his S&P 500 weather segment, wasn't exactly making people forget Al Roker.

Worth's forecast sounded something like "partly sunny, partly cloudy."

After a while, and a couple rewindings, we think we figured it out — maybe.

Worth showed three charts of 150-day averages, from 1973-74, 1981-82, and 2002-03. He said, "The issue is, in order to qualify as an official new bull market, the smoothing mechanism must have an upward and, and, immediate torque to it."

So there's the tech-analysis definition of an official new bull market: a "smoothing mechanism" that must have an "upward, immediate torque to it."

The first thing we noticed was that his 73-74 and 02-03 charts did indeed flatten for a while, but 81-82 was more like an elongated V.

Worth concluded that the charts are suggesting a flat finish to the end of the year — even though, according to the parallels he was drawing, we're apparently just in the bottom of a new bull market.

Then, asked for a trade, Worth offered MetLife (MET), calling it the "same phenomenon" with the chart and a "well-defined" reversal to bullish.

So it's the "same phenomenon," but one is going up, the other is going flat.

We think his point was that the overall S&P chart has just begun to flatline and thus has more flatlining to go, whereas MET is farther along the flatlining process.

But he never said that.

And given this interpretation (which seems the only realistic interpretation possible, and unlike probably 99% of viewers, we've now seen the segment at least three times), it wasn't explicitly clear if Worth thinks we actually are in a new bull market, or whether it will take more sustained flattening to convince him of such. (He did make clear, the worst is behind us.)

He also didn't answer Karen Finerman's excellent question as to whether the market would bounce up and down and merely end the year at 1,000, or whether it would be flat around 1,000 for the next five months. His answer implied the latter.

He also wasn't terribly enthusiastic about Steve Grasso's harmless joke about being a weatherman.

We've always liked Worth at this site. This one felt a little mailed in.

(By the way, we're wondering what's going on with Dan Fitzpatrick. Yes, we posted a while back his tweet that "less is more" or something like that when it comes to TV appearances and he was trying to cut back. Surfing's great and hopefully he's doing some, but let's not get totally off the groove when it comes to stocks either.)

The star of the day was Karen Finerman, even if it unfortunately was the result of a Whole Foods stuffing. Melissa Lee pointed out the WFMI puts Karen owns probably weren't doing so well after the stock surged afterhours and asked how Karen would manage to get herself out of this one. Karen said, "I might not be able manage myself out of the trade." Later, Steve Grasso said a viewer was probably wondering what Karen was wearing (a ruffled top) and Karen deadpanned "I'm wearing the barrel." Joe Terranova even threw in a WFMI zinger in the Web Extra, which we don't know how we managed to end up watching.

Anyway, it's always good to know that even the greats at money-managing can have a bad trade.

A small little debate occurred over homebuilders. "I think the bottom is in," Finerman said, adding, "I am long Centex." Grasso said, "My hedge funds also feel the same way." But Pete Najarian begged to differ. "This is a long ways from over for these guys," he predicted.

Joe Terranova suggested at the opening that people who are short when the unemployment number comes out this week might be in big trouble. Melissa Lee suggested, "Sounds like you're changing your position" of last week when Terranova predicted the same number would produce a headwind on the market. Terranova didn't disagree.

Grasso and Finerman then debated the whispers about the number. Finerman said she thinks no one probably knows. Grasso said, "I don't believe in aliens, but I believe people know that number."

Terranova also sparred lightly with Pete Najarian over tech, whether the givebacks today in many places except RIMM were a sign of overheating, or buyable pullback. That reminded us of Terranova's curious claim a few weeks ago that because AMZN had reached $90, it was more or less automatically going to $100 because that's what stocks that clear $90 do.

Melissa Lee set herself up beautifully with analyst Mark McKechnie of Broadpoint, explaining the whole panel except for her thought John Chambers would be bullish, and who was right. Lee, in hot red dress, was right on point all day, not forcing lines or laughs, and it amused when McKechnie delivered the takedown. Cisco, McKechnie said, would be likely a market perform, but "we're not pounding the table here on it ... not our favorite name here," but an acceptable one.

McKechnie, it turns out, was once a designer on Motorola's MicroTAC phone and also worked at Intel. He's got a B.S. in computer and electrical engineering from Purdue and an MBA from Northwestern.

Rich Repetto of Sandler O'Neill stressed differences between high-frequency trading and flash trading. "Flash orders at least from my perspective, you know, was (sic) unfair to the average, uh, investor," he said. Pete Najarian made a similar point in more detail at "Halftime," saying high-frequency trading "actually adds liquidity" but that flash trading was only seen by certain parties. This is a topic that Repetto might've been good at delving into; when Eliot Spitzer came on to discuss it last week we didn't know what he was talking about after about, oh, 10 seconds. Repetto was asked about the exchanges, namely CME and ICE, and why they weren't doing better with issues such as cap-and-trade to benefit from. Repetto said "there's a lot of regulatory risk." Repetto is a West Point grad (general engineering) with an MBA in finance from Wharton.

Brian Overby of TradeKing was brought in to choose a few possibly overheated stocks and floated a couple, Continental Airlines and Ann Taylor. Except he never did talk about Ann Taylor, nor is it mentioned on the CNBC.com official recap. "The catchphrase is consumer discretionary spending," he said, but basically it amounts to Overby thinking Continental has too much debt to justify its current rally.

Grasso declared BAC, and no longer XLF, as the new "true barometer" of bank stocks.

Pete Najarian was really excited about Teck Resources (TCK) because of heavy call-buying at $29. He noted again the stock's big run but indicated where there's smoke, there's possibly fire, and made it his final trade. (This writer is long AA, sorta because Tim Seymour told everyone to do it.)

Karen Finerman apparently is losing enthusiasm for Nokia. It's "their last quarter before I pull the plug," she said. She liked PDE for her "Final Trade."

Grasso picked DTV (this writer is long DTV) for the finale, even though according to disclosure he and his firm don't own it, and Terranova again pointed to ABT. Terranova, according to disclosure, is short WFC, among others.

Rick Santelli once again was beamed in from the CME to talk dollar and other things. We didn't get much out of this segment either except he drew a funny parallel to bomb shelters.

Dennis Gartman was nearly a late scratch from the "Halftime Report" but became the first guest to join this 10-minute show in mid-session ("bad traffic here in Virginia Beach"). He said "I don't think you wanna buy CAT up 4 or 5% on the day." But he said Cat's outlook on a global recovery was good news for the sector. Pete Najarian said options buyers despite Gartman's comments think there's more upside to CAT. Gartman said it's great on a pullback.

[Monday, August 3, 2009]

Fast Money Review: Finerman
says clunkers is a lemon

Featuring: Karen Finerman | Tim Seymour | Erin Burnett | Joe Terranova | Steve Grasso | Phil LeBeau | Rick Santelli | F | AA | Guy Adami | Jon Najarian | LVS | Jim Murren | MGM | AAPL | GOOG | MSFT | Gene Munster | EBAY | BAC | Sallie Krawcheck | $49.99 breakfast | WFMI | Peter Swinburn | TAP | HURN | Zach Karabell | FCX | Brian Stutland

Karen Finerman is one of the few people heard in the national media questioning the merits of Cash for Clunkers.

"I don't really get what this does," she said. She predicted, in fact, that it would be little more than a gimmick like 0% financing, and that once dealers start ordering extra inventory to account for this sudden surge of demand, they'll be "right back to the same place" of overproduction before the financial crisis of 2008.

But no, responded Tim Seymour, there's a "difference this time," and it's because massive cost-cutting and downsizing are rampant in the industry.

K-Fine suggested the new cars being sold, the most energy-efficient ones, are among the least profitable for the automakers. Seymour said anything they sell is now gravy, because overhead costs are so much lower.

Even though Finerman had a dazzling new hairstyle, we're going to give Seymour a slight nod here. It might only be a short-term thing, but the bottom line is we needed a way to get people back to these dealerships, and this seems to be doing it. People see their friends and neighbors with new cars and then they get the itch. We also need to get people back to the malls. No, they should not be blowing out their own personal credit lines in doing so; saving is great.

Regardless, the occasional Finerman-Seymour debates, which are getting to be more occasional in recent weeks, are emerging as some of the show's more compelling material in the rather flat post-Macke era. Seymour for one is questioning his fellow panelists more often. For a while Steve Grasso was relaying a lot of good gossip from the floor, but with a steadily gaining market, that routine has started to run dry, and Monday he was about as unnoticeable as Jeff Macke. Joe Terranova had so little to say we wonder if he was a late pinch-hitter summoned from the clubhouse in the 9th inning.

Finerman though wasn't alone in dismissing CARS. Rick Santelli called it a "clunker" of a program, yuk, yuk. One wonders if Santelli got good reviews last week on "Fast Money" and thus that's why he was beamed in for a market-opinion segment Monday. Or maybe the tea party buzz has faded and the network wants him re-exposed. All we got from him was "I think we're in a clear and simple inventory cycle;" he suggested like many have that the market might be on Prozac.

Phil LeBeau did a remote appearance from Illinois and said basically the $2 billion for clunkers is coming, just a matter of when.

Erin Burnett is sort of like Mark Buehrle of recent days — a perfect game last week, and a chance to do it again in her next start. She took the mound Monday more than capable, relaxed in a blue jacket and modern '70s-throwback look, owning the camera as always. But with only three days' rest, the combination of technical glitches and breaking news throughout the hour provided serious headwinds, and she never quite got the show in rhythm. The low point was the entirely expected "What happens in Vegas" attempted joke, but she made up for it with her reaction to Karen Finerman's bearish play on Whole Foods, "I'm gonna be shopping there later though." Yes, to those who wonder, it's unfathomable why there is no ring on Burnett's left hand.

One of the best calls of recent weeks has been Tim Seymour on Alcoa. Recently he's been recycling it almost every day, and he should, because this thing has been on a tear, really since the time a few weeks ago when Dennis Gartman said he had to start unloading. "I'd own Alcoa here and I do," he said Monday.

Seymour made a point of mentioning at the top of the show that he was the only one on the panel on Friday saying don't get short over the weekend. A bit of braggadocio perhaps, but fairly well-merited, especially given how often Guy Adami has predicted "we're definitely due for a crash here, I can just feel it" in recent days. Joe Terranova said he was surprised that the market could rally like this in the same week as the upcoming unemployment numbers. Steve Grasso suggested maybe the bears have capitulated, saying the difference from previous weeks is that today, the shorts were absent, not trying to push the market down.

Seymour is so intrigued by the automotive industry, he offered Ford as a "slow money" stock to hold for 10 years if one was so inclined. (The intro to this segment was way too long, but whatever.) He also said it appears to him that AAPL is hurting Nokia, a longtime favorite of his, in the smartphone market. He said of the brewery industry, "that sector is very interesting."

The brewery discussion came up around an interview with MolsonCoors (TAP) CEO Peter Swinburn that was delayed by glitches. The question not answered was why was Swinburn on this show? Presumably because of the "beer summit" last week. This segment was the subject of CNBC teasers throughout the day, but fizzled like ale that's opened a little bit after the born-on date. Swinburn was courteous enough but had nothing new to offer the show. The beer market now is just a continuation of the first quarter, however that went, and TAP has a wide variety of brands designed to "match the consumer" on every level, and cost-cutting has occurred not just in one specific area.

Swinburn has been in the beer industry since 1974. He's got a B.S. in econ from the University of Wales.

Jim Murren, CEO of MGM, did have more positive news to report on his industry, saying "our occupancy rates have started to improve." Steve Grasso asked him a very disjointed, lengthy question about government shunning of tourist hot spots for conferences. Murren expressed disdain but called TARP-related conventions a "peanut amount of our business."

Murren, interestingly enough, was a Wall Street analyst for 14 years and a Deutsche Bank veteran. He got a B.A. in art history and urban studies from Trinity College in 1983.

Jon Najarian and Guy Adami, enjoying an optionMonster gala in the Sin City, did bring a bit of pizzazz to the show with a live spot from their hotel, but other than keeping an eye on (yeah, you knew it was coming) Las Vegas Sands, not a whole lot of inspired trading. Najarian said of the casino names, "I think they've got lots of upside," but Adami noted, "the people are definitely not gambling yet; the tables are pretty empty." He did say "Adelson's a stud" and suggested LVS was worth a look closing in on $11 because of "tremendous short interest."

Jon Najarian has twittered photos of their stay and says Adami is drawing a wherever he goes at Caesars and might be more popular than the president.

We learned Adami had a steak-n-Perignon breakfast for $49.99. At least they weren't trying to count cards over pancakes.

Gene Munster, whom we root for because he's from Minnesota, took up this strange theme of Google vs. Apple vs. Microsoft that was sort of introduced early by Burnett with no discernible rationale and sorta carried on through the hour. Munster did say of the eBay outage news, no big deal, "expect the Street to turn positive" on that name later this year.

Karen Finerman described the monster drop in Huron (HURN) with her favorite word: "Ridiculous."

K-Fine spoke of the BAC upheaval and declared, "I think Sallie Krawcheck is a great hire for them." Joe Terranova said of BAC, "there's every reason right now to be long."

The "Halftime Report" featured Michelle Caruso-Cabrera in showstopping red, complete with crimson shoes. When not noticing Michelle during an episode that was otherwise as dry as Najarian and Adami's Vegas Strip, viewers were entertained by another one-liner from Zach Karabell, "I guess Bank of America is too big to fail, but it's not too big to indict." (OK, not his best effort, but not a clunker either especially when considering it was delivered on the fly during breaking news of the SEC charge.) One note, as far as we can tell, it was merely an SEC "lawsuit," not an "indictment," and it's already settled, for the monster price of $33 million, an amount Lloyd Blankfein could probably take care of personally. But this was a moment of satire; we're all OK.

Karabell also offered this on Sallie Krawcheck, "do you think that job comes with a free Ford?" We're not quite sure what he was getting at there, other than linking the segment to a cash for clunkers segment, but it was quirky enough for a laugh here. Krawcheck, by the way, made money the old-fashioned way — Smith Barney — and has had a famously long career between Citigroup and Sanford Bernstein; also is a director of Dell. She's got a 1987 B.A. from North Carolina and a master's from Columbia.

Karabell made this interesting point on China, that it's driving base metals, but "oil is not being driven by China demand." He said "you buy what China buys" and mentioned FCX, even though it would've been great to be buying at $16 rather than the present $64.

Brian Stutland said that on Friday, somebody paid $32 million for a load of the S&P August 1,000, a "huge bullish bet."

Jeff Macke done at CNBC

The somewhat-predicted earthquake at "Fast Money" has happened, according to TVNewser. We don't know if he was fired, or if it was a contract expiration, or even Macke's choice. All they've got is this quote from CNBC spokesman Brian Steel: "Jeff is no longer with CNBC. We wish him all the best, and we thank him for his quality contributions."

CNBCfix wishes Macke the best, and looks forward to his own explanation at Minyanville of what happened.

CNBCfix turns 1, thanks readers

We're so busy at CNBCfix, we nearly overlooked something we consider as important as Guy Adami's "Final Trade."

Our birthday.

CNBCfix actually launched the last week of May 2008, though we didn't get much of a real home page going until early June. Our pride and joy then, as now, was the detailed "Fast Money" review (which we called "Fast Money Fix" at the time but quickly thought that sounded strange). We also did a nightly "Mad Money" review, but stopped that after a couple of months.

We coined the term "CNBCfix" well before partisan interests were clamoring to "fix CNBC." Occasionally we get lumped with that. We're not trying to fix anything, and we don't consider CNBC a controversial business entity. CNBCfix is for people who like getting their "fix" of CNBC every day like we do. (The fact it's a very short term and easily typable for a URL, um, didn't hurt either.)

The Web business is extremely humbling. Those who've tried it know what we mean. Site ideas that turn out shoddy. The complaints or shrugs. And perhaps the worst, the hopefully infrequent minimal traffic days. Sometimes it makes one wonder, "Why am I doing this?" CNBCfix does it because we think we have something to say. And we say it, like you see on every one of these pages, dedicated to the highest standards of journalism established long ago and still practiced by print newspapers and news magazines.

We don't know if we'll hit blockbuster traffic numbers. We do know that some very accomplished people are reading CNBCfix, in Englewood Cliffs, Manhattan and far beyond. We've heard from some, are aware of others. These are people well-versed in the issues of Wall Street, Washington, the national media, and the world, in some cases maybe even leading the discussion. And like anyone else, they like a good stock tip too.

In our earliest "Fast Money" review on record, May 28, 2008, we grumbled about the monotony of the show that week, complaining the panel "risked relegating their show to only-once-a-week-must-seeing." There was a large amount of MSFT-YHOO discussion (Tim Seymour finally helped stamp that out a few months ago), and Pete Najarian pounded the table on oil services. Stacy Gilbert came on to talk options, but the most interesting guest was Gen. Barry McCaffrey, who called Iraq's security situation "immeasurably better" than a year earlier and predicted a "functioning state" at peace with its neighbors and producing large amounts of oil within five years.

We're here because you are. As always, we're fighting for every click and appreciate the ones we get.

Now back to our "Fast Money" review.

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