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tv   Fast Money  CNBC  February 4, 2010 5:00pm-6:00pm EST

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there's no one clear suspect. no one clear catalyst as to why the market is going down. but you know what, it's going down and it's motivating me to take losses in my poof because i have to. >> you're a fundamental kind of gal, are you not? i think the reasons will be very telling for people out there. >> for us, we have a long of h term thesis in a lot of things we own. i really didn't know what to make of today. it is disconcerting to see the market move down so much. however, in a lot of things we own, i didn't see anything that would fundamentally change their stories. i didn't do anything, sometimes that will be the right thing to do. sometimes it will be the wrong thing to do. it's too soon to know whether that's right or not. >> does that mean you didn't curse more today? >> let me tell you something, i concur with that completely. there was a lot of fear on the floor today. but people didn't know what to do. that's the volume wasn't so great.
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>> we started out with ref rick out of the d.c. it led to china, the sovrj debt issues. >> we have political rhetoric, concerns about china and sovereign debt poppite all came to a head today. >> that's exactly right. >> we've dealt with the vol kerr plan. >> why did it all come to a head today? >> oh, why? because it's just timing. unfortunately if i knew that, you know, that's the $1 trillion question. >> everyone is so confused. everyone shares joe's sentiments. >> truth is stranger than fiction. this didn't make any sense. there was just this confluence of all this nevertheless all at once and we can't verify it. but there's a whole bunch of
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issues people are concerned about. not the least of which are technical levels. everyone look at 1,100, then 1085, then 1071 and now it's 1061. you had them all crashing in all at once and technicals, what has been driving this market for the recent -- >> but what drove the market today was emotion. and that's something that has not been driving the market over the last week or so. if you go back to last even, we left this desk feeling phenomenal about what we felt about cisco. at least i did. when i woke up this morning and i saw the s&p futures trading 1089, i was scratching my head. almost skipped my pilates class. i went to the pilates class and came back and it was trading 1085. >> emotion always driving the market. >> but it's more than the last couple of weeks. >> it's more on the way down. even hedge funds make money when
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the market is going higher. you're watching your money go back out. >> are you trying to make feel any better than i was? >> that's why it's so emotional. >> as a trader, you know this well. i don't know this because i'm not a trader. when you lose a lot of money it's hard to get back in. part of this is just sort of getting over the fact that you've lost whatever amount of money you lost that day. stud a prime example. >> what do you look at to make your decision about getting back in? if the fundamentals have all been good, if the economic data has all been good, what do you look at now? >> that's just what karen was saying, too. we're looking for some unusual buying pattern in the market. buying of puts, bearish. buying of calls? bullish. i just saw a lot of people pa c panicki panicking. the put buying activity was very accelerated. we were down huge on the morning. people were looking for protection at one level.
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they weren't looking for bounces. they were looking for what support was. >> the amount of ims i get on the floor or the amount of hit is get when people say what's going on, what are you seeing? i had by 9:35, 150 ims flooding me. it only cascading higher, not lower as the day progressed. as we hit each of those technical levels and took them out, guys were hitting me more and more and more. >> did that correspondent with volume? >> you made this very askut observation earlier today. >> i think from january, you could see the biggest volume days are the down days. but i think karen really touched on something. people were so confused that the volume dried up. when you see that volume hit 1.5 billion, 1.4 billion. as it has the last four days or so, february has been very light. but those days are those big down days as joe said. those are the big emotional days where guys say, i don't know
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what to do. just sell the market. clear up my positions. that's why you saw gold come in. that's why you saw everything that's a safety bet be sold today. guys didn't know what to do. >> going forward, i do not believe you don't trade. i think you have fundamental ideas, fundamental theses that you believe in and you just move from overweighting as i mistakeningly did yesterday in technology to an underweight position. i am ready, i will be rather aggressive when i see the moment that john will see also in the market of a bottom being in place. i'm coming right back in to get as long as much energy as my portfolio allows. i'm going to get long as much technology as i can. long as much jpmorgan and bank of america and google. i' not playing this right now from the short side. i'm not flipping, i'm not getting short. >> hold on, steve, you mentioned 1065 is a technical level. we're at 1063 right now.
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>> 1035 is what guys are thinking about now. that's going to be a 10% correction from the 1150. guys are looking at 1035. >> you said the volume really wasn't as high as you would think on a day the market moves this much. what does that tell you? >> there wasn't conviction behind the selloff. >> it's too much of a selloff. guys weren't ready for it. it caught them off-guard. in the past when they were at 1135 to 1,100, guys felt it. you know, we could go lower. >> just as you say, the 10% correction is 1035, 920 is the 20% correction number. the bears are going to try to pull their trade. when obama said stop, all this kind of thing, if you want to push the bear case you're going to say we better break 1,000 and head towards 920, otherwise this
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is just that 10% correction that's so overdue. >> do you go lower or higher? the risk was to the down side. do we go to 1035? that's why the volume dries up. it's not a safe bet anymore. >> the best thing that could happen is tomorrow's unemployment report, the report itself triggers a reaction with the market itself continuing to move lower. >> same thing pete was saying. i was talking to pete today and what he was looking for was where do we get that pivot point? you know, where we get to a spot and either break to the upside or down side. we're right at 1065 or thereabouts, 1063 in after hours. that's the pivot point. we could go right back to the upside. not huge, but we could see a recovery of half the loss we had today. >> and karen for you, do you look for those pivot points? how do you marry that with sort of the fundamentals you see as a stock and the levels you think the stock is worth? >> i really don't pay attention very much at all. i mean, i understand there are people who do and i believe that does drive the market, but we
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can't be all things. and so we just really focus on what's happening in the underlying business. did anything that happened today, should that cause us to rethink what the outlook is for the businesses that we own? >> did it change -- >> and i would say no. >> i agree, most firms are smarter to do that. the only problem is 2/3 of the stock market moves with the overall trend. even though you place great bets and it's based on great fundamental bets, your stock could move lower and you could get flushed out because you don't want to hold on to that position. but it still could be a great quality company. >> i want to delve into the root of the market today, and that's greece a bad situation could actually get worse tomorrow. brian, why do you say this? >> well, i saw this item on the blogs. it was really lighting up the internet. and i took at it, it was a greece newspaper, a greece newspaper story. i think we have a graphic of it. i don't speak greek, i don't
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translate greek, beyond that, i don't know what this is. so i hired for me -- if i'm going to put my money on the line, i need some real data. i hired a law firm, they have big operations in greece and they translated it for me. and i was shocked when i saw this line. you can see it on the screen now. there's a secret debt of $40 billion that's unaccounted for that greece just, quote, unquote, discovered. so i mean, to put that into context, what greece is being asked to do right now is reduce their debt by $40 billion. this is an additional $40 billion. even if they execute precisely, they're still going to be in the same situation that they are today. so i started thinking to myself, well, if this is happening in greece, where else could it happen? it could happen in spain, it could happen in portugal, it could happen in any of these countries. i think we have the spain cds spreads coming up perhaps? maybe we don't. but the bottom line is the cds spreads were a blowout.
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there we go. >> i translated one from this newspaper -- i'm looking at the cds spreads and what really shocked me was when you look at the lehman brother spreads in september before they went under and the greek cds spreads now. >> how can you compare apples to oranges? how can you compare sovereign spreads to corporate? >> why not? they both own money? >> but a corporate buyer can't just issue or tax. a government can. is that's a big difference. >> but our government issued and taxed to support the banking system. what's the difference? >> the difference is you can print money to pay the debt. lehman can't pay lehman dollars to pay lehman debt. >> i'm not suggesting that greece is going to default. not at all. i completely understand what you're saying, but the answer is, they either print money and/or they cut their spending. one of the two. either way, the bottom line is it's negative for the euro and
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positive for the dollar. >> i agree with that assessment it's definitely driving action into the dollar, no doubt about that. but i do also wonder about the newspaper. the same newspaper had a story about angelina jolie and brad pitt visiting a space alien. we can find a million different headlines. >> but let's bottom line this, the fact is if this is appearing in the newspaper and being read by investors around the world, whether it's true or not, if it's having an impact, it's having an impablt. brian, what is the bottom line trade off of this? >> the bottom line trade is safety. you have to be short euro, long dollars. that's the best trade i see out there right now. all currency trades are relative value. relative to the euro, the u.s. dollar looks much better right now. >> and that safety trade in gold is just not working out at all for those folks. folks that bought gold there and all those ads on television for
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buying gold, buying gold, the safest investment. it's not so safe. >> i think the analogy was lehman was to the stock market as greece is to every other country. >> is that the point you're making, brian? >> you know, greece is the size of mississippi. it's not a very big country, but the point is, is that lehman was only one company. you know, aig was only one company. how integrated is all of this and where does it spread? and again, i understand what you're saying you can't compare the sovereigns and the corpor e corporates but if you're going to print money to get you out of here, the trade is euro is going lower, dollar is going higher. >> aren't you really late? we've seen already an enormous move in the euro, enormous in a very short period of time. hasn't this already occurred? >> well, i think yes, i've been long the dollar since november really. but the real thing is does it spread? and can it spread? and here's why it could. i don't know if it's going to. but eurostat who collects the
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statistics, they have no enforcement action over whether or not the country's books are actually accurate. greece is doing this for years. anybody else could be doing it. it's just like the banking industry here, there's really no regulat regulator. >> except trichet could throw them out. >> the u.s. dollar has rallied significantly and it has shaken out a lot of shorts. that has affected the commodity trade. one of the most attractive trades out there, commodities right now are getting obliterated. >> you should e-mail that translation over to jean-claude and see what he says. e-mail it to him. we'll check on you a little bit later on. joe mentioned we saw dollar
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strength certainly as a flight to safety. the commodity sector getting pummeled today. today, joe, at this point, what did you do? you had freeport-mcmoran, you're out of it? >> when i became unstressed after pilates? or when i started eating godiva chocolates to make myself sfefe better? >> it was bad. >> what i saw in copper, it's significant selling. that tells you risk off. it's directly tethered to a rising u.s. dollar. it's directly tethered to the problems, the sovereign problems that brian is talking about. in oil today, i tried to play oil all day from the long side. it was rather frustrating. i used tight stops throughout the day. and i basically at 11:30 said uncle. i said i can't do this anymore because there was a lack of institutional buying. when there's not a big fish in there who's willing to take the other side of that selling, it tells you to run.
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that was completely absent from the oil space today. it was also absent in gold as well and in copper. commodities right now are on the defensive. >> you're looking at some steel names? >> everyone is focused on sovereign debt right now. it's at the timtethered to chin. guys are looking at where they can catch the falling knife in steel. you're looking at another 25% on the way down. >> we'll have to see if that plays out. basically i was on a panel last week with a guy from black rock. and what he was talking about how he measures growth in china is electricity. he says nobody just produces electricity without using it. so he says their electricity production up 20% in the quarter. that's why i'm more willing to believe china growth going into this year, but the problem is how hard they step on the brake causes them to cut back. >> and the problem is they've already had so much supply in steel even if they still grow it
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still can come back. >> we've got to take a pause here. our coverage, though, of the worst selloff of this young year continues after this. believe it or not, there are some things that went up today. we'll look at those plays as well as ways of protecting yourself coming up next. he broke news on "fast" so what is this legendary investor doing now? the chairwoman with an exclusive talk with bill ackman. his secrets to making money in any kind of market. and a great american turnaround story. sara lee rising when others aren't. but are the big moves baked in? the ceo reveals the company's recipe for future success exclusively on "fast." but in business, only two matter: red and black. red, well, no one wants that. black on the other hand, has strength. black is always in style. it's what business looks best in. black is where growth and success happen, and it's easier to get there and stay there
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welcome back to "fast money." we're live at the nasdaq market site in times square. the biggest drop on the s&p 500 since april 20 of last year. we have stabilize. that's the good news, guys. we have stabilize. >> thank you, doctor, for that assessment. >> we're in stable condition. >> we're in the intensive care
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unit still, though. >> we're waiting for the overseas -- >> be sure to watch cnbc. >> nice plug, wink, wink. we're also waiting, of course, for the open of the asian markets and european markets. but 830, of course, the key number here. the dollar, a flight to safety. we did see some strength in the after-hour session. it continued to strengthen just slightly. we do want to focus -- there are a couple of things working amidst the selloff. there was some money to be made somewhere in the market there. cisco is one area. after yesterday's earnings, very, very positive guidance, holding on to a gain today. but also some lesser known stocks. maybe under the radar that also managed to finish higher. children's place, karen, up 3%. >> really, the only way to explain it is to rush to children's place. if the world is falling apart, where should you be?
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children's place. it's the only logical place. i don't know. it's nice when one of your positions working out. flight to quality, no good for short treasuries, but that's all right. >> when it comes to cisco, we were all over that story yesterday on the desk. we were very positive off of that. we were expecting it to move higher today. we were expecting it to move the tech sector higher today. but there are some cautionary levels we're watching as well thanks to todd gordon. he just e-mailed us, our fast friend, flash, writes hey, team. the only green on my screen today was the u.s. dollar and the golden boy cisco. i'm thinking $22 test is next. what do you guys think? so we are headed lower, even on the back of very, very strong earnings. what do you think? >> that's one of them you buy. everything john chambers said was bullish about the outlook
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for his company and how the environment is right now, not just three months, six months out. but how it is right now. so like i said, ahead of that announcement yesterday, we got long cisco. we held it into this morning. dumped it as the market rolled over. same thing with visa. those are stocks you want to own and buy on dips if you get the chance. >> absolutely. i'm waiting for things to get aggressive own and go j overweight. one will be google and apple. >> abercrombie is sliding through the cracks, too. green through most of the day. great earnings. many people think the stock can double from here. you're paying basically in the low 30s, the cash and their international. you get the u.s. business for free. >> and those are the pms you're talking to all day long. >> all day long in the fox hole on the nyse. >> never scared of black helicopters and conspiracy
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theory, santelli believes the debt of greece may be falling victim to the same brains that brought down bear stearns. it was a death spiral, and some went under or became bank holding companies. >> yes. i don't know if it's a conspiracy theory. i think it's more trying to dig to what the real cause is. for the credit crisis, and to try to learn something so we can move forward. if you recall, when that spiral was created, all the bagang at e desk, melissa, they had to stop. they had to outlaw short selling for a while. it goes back to my point, you can have all the regulations you want, wall street will find a way to get around it. what they won't be able to get around is if you change things like margin and capital requirement on these death spiral construct prukts like credit default derivatives that have no solid backing in the real world and i still question, even the exchanges that are doing them is how the heck can
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you margin something where one day it's worth nothing and the next day you have to come up with 100% and you never know when that's going to occur. >> yeah. einstein or oppenheimer, these guys were creating the atomic bomb. the financial guys have done the same thing with the credit default swaps. except they have less of a clue than those guys had. the credit default swaps do the same thing because the people do not have the money backing up these trades. i don't know for sure but i would love to hear your thoughts on it. does anybody have 50 cents on the dollar for the credit default swaps they've written? i bet they don't have 10 cents on the dollar on these swaps. you can't regulate, rick, what you can't see. if these things aren't on the floor, there's no reason for us to let the banks trade them. >> that's right. and they embolden the people that are partially responsible on the short side, whether it's
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stocks in brazil or stocks in greece or any of these indices because they believe that the default swap is going to protect them if the country or the credit quality goes you should. if we should have learned anything about the counterparty collusion story that occurred with aig, what it really boils down to is they need to take the risk of their counterparties and where are they coming up with a hedge to be able to write these special options? why should the government get involved in that? and while all this was going on, even harrisburg, pennsylvania, is pondering a bankruptcy 9 filing. it's even in our own backyard. >> rick, so who do you think has this exposure where they think they have protection but they really don't? >> lot of the investors who are pushing some of these markets. another big banks, rick? investors meaning the big banks? >> sure, big banks. hedge funds. i think there's many big players involved in these games.
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>> rick, i want to -- >> top of the show, real quick, i forget who it was talked about the $40 billion extra problem in greece. we were looking at it on tuesday. there are a zillion of those types of stories out there, but how do we know what's real and what isn't? >> how do you get it in the press so people will talk about it. >> hire translators. hold on that's -- >> obviously no one getting paid 100 cents on the dollar if this fails. is it to stay away from financials, rick, at this point? >> you know, i think that's a pretty safe bet, but i also think there's some opportunities here, because the issue isn't going to all fall apart tomorrow or next week. but we should learn from what's going on in these other countries. to modify our own behavior over the next several years. >> real quick on the dollar, you've been on the dollar story the last year perfectly. you've got to move higher in the dollar. do you believe the dollar story to the down side where we're basically monetizing our debt is over? >> no, i think the dollar story
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is every bit as ugly, but the euro scenario could be uglier. and you can't go short the eu you'euro unless you go long some other kourncy. they're connected at the hip. that's why the dollar is doing better. >> always a pleasure to get your insight. i do want to get to a fast message. i know you guys out there have a lot of questions. especially on a day like today. do write in. we got one from john in maine. are there etfs one could play to play the euro losing value and the dollar gaining value? >> you go to the uup. that's the best way to play it. you could also play the other currencies. play the fxb, which is the british pound. you could also play the japanese general. >> right, uup tracks the dollar ind index. it's mostly the euro but it does have other currencies in the mix. if you've got a question out there, we'll do our best
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especially on a day like today to answer your questions. coming up next, reliable safe havens are not working, how do you protect yourself? we'll tell you how next.
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we told you before that we saw dollar strength in the after-hour sessions. we are seeing euro weakness in the after hours. brian, what do you make of the move lower? >> i think it's just a continuation of what's been going on today. there's rumbling s out of portugal. they have a big vote on their budget deficit. if you look at the asian session here, things are getting a little bit weaker. i think you just see that rollover continuing. >> you anticipate a stronger dollar scenario tomorrow as well, so therefore commodities will continue to be weak in tomorrow's session? >> correct. >> we don't have the leadership at all over the materials for one? >> i think this continues until you get some kind of certainty. i thought you would get certainty when the ce approves greece's budget, but that
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doesn't seem to be happening. you really have to think safety. >> i worry about another crap show tomorrow. if the jobs report for december is as bad as it was, i can't believe the one to january is going to be any better. >> tomorrow could be a troublesome someday and tonight the indication will be the dollar itself. does it rise again? one trade again in oil, be careful, don't go short. >> our thanks as well to b.k. we'll check in with him later on. he's manning that prop desk for us all night. >> all night? >> well, as long as we're on the air. we let him go home and sleep and eat a little bit before he gets back on the prop desk. let's talk protection since we're anticipating weakness in tomorrow's session. there's always one place to get it. and it is, of course, in the options pits. the action in those pits today, fierce. take a look at this. this is the vix. we showed you this before. a snapshot of prices.
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when investors get scared, they buy puts. people panicked. jo jon, how are you protecting sglours. >> instead of the dow 10,000 hats, it will be the vix 50 hats. you saw a lot of joes and janes that were panicked. they were scared. feel it. mr. grasso has spoken to that all day. they were selling calls on theed by. that's not a great way to buy protection. you want to stay with your position and you're looking for a way to harvest your money. i would not buy puts naked here, folks. not because i don't like running around without my clothes on, i do. >> that's another story. >> what i would say watch is -- if you buy a put when the market has just made a move like this, you're buying insurance 20% higher than it was a day ago.
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if you're paying $4, now you're buying $5 for that protection. that's expensive. >> i find the puts hard to trade around. >> really? come to options monster. traders want to trade with you because you're not making them lean one way in the market too big. if you do a spread, buying one put, for instance, the 106 puts in april. if i had exposure in the s&p, i would buy the spy 106 puts and sell the 100 puts. you can buy 100,000 worth of protection for $1,700. that's 1.7%, folks. why wouldn't people do that if you're squacared? >> because it's last-day trade. >> i've got to answer the phone. somebody is on the fast line. a very special guest. he's not here on the desk tonight but that doesn't mean he's not following the markets for us. that doesn't mean he's not
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trading those markets. guy adami, the negotiator. you' been talking about this for a long time, the shadow bear market. it looks like the bear is no longer in those shadows. >> how are you, team? i miss you guys. i ran out of the dinner to answer the phone. we've been talking about the shadow bear market. i'm not going to hold you guys up, but we've been talking about this for a while. you look at names like goldman sachs. freeport-mcmoran, broken. all of these names have been pointing to the s&p going lower. then if you want clarity, go back to intel's release a couple of weeks ago. that stock piked and has been going lower ever since. good news, bad price action. the market has been wanting to tell you that it's going to go down. and i would take the other side. you don't have to play defense. you play offense now. things go down faster than they go up. >> that's your favorite phrase of the day. tell us, guy, what would make you think we're headed higher?
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do you take a look at the same stocks that led us lower as the sort of canaries in the coal mine? >> yeah, now you're looking for the same capitulation on the upside, now you look for it on the down side. you didn't see it today. people are going to try to pick bottoms tomorrow. i think it's got a lot of room left on the down side. we closed below a lot of technical levels. a lot of things broke, the 200-day moving average. people got complacent and that leads to bad things. tomorrow is not the day to go bottom fishing. >> last question, what is the one stock today that you might want to buy tomorrow? >> well, you know what, if you want to play defense, if you want to go that route, go to the name is mentioned, the johnson & johnson. i think cisco traded okay today. gap stores, their comps came out okay. but again, if you're looking to buy things tomorrow, you have a lo long-term time horizon. i think the better trade is to step on the gas on the short
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side. miss you, big kiss. >> that's what traders think. that's why you saw that unknown today. and no one knew when to step in and that's why you might see tomorrow. no one is going to get long this market on a friday. i don't think anyone is going to put a line in the sand on a friday. >> the selloff hitting all the major movers of the day. were there any future drops in these pops? broadband. 31 are streaming a sales conference from the road. 154 are tracking shipments on a train. 33 are iming on a ferry. and 1300 are secretly checking email on vacation. that's happening now. america's most dependable 3g network. bringing you the first and only wireless 4g network. right now get a free 3g/4g device for your laptop. sprint. the now network. deaf, hard-of-hearing and people with speech disabilities access
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welcome back to "fast money." we want to talk about gol. it's always considered a safe haven, but today we saw the biggest drop since december 8, 2009. joe, you made some good points about whether or not this is true. the old adage that when there's fear, go to gold. >> tried to buy gold at 1090, went to 1080, got out. gold is broken right now. march 17, 2008, bear stearns moment, you should have gold in your portfolio. safe haven play? think not. october 24, gold trades 615. what did gold do for you in the
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credit crisis? absolutely nothing. what is gold? it's a tool that tells you when a central bank's monetary policy is working. the reflationary trade is working. it has a place, but a small place. not overyagt waigt. >> what do you think of this outside of stocks? >> sadly, long-term treasuries on a day like today, but i think that's a temporary phenomenon. the gold thing is fascinating to me. do you think the retail story is over for told gold? and you have the technical of retail, the mass exodus. >> guy called in before and guy mentioned there's a lot of things broken. for the retail investor, absolutely. gold is broken right now. the uptrend is broken. if you're a retail investor, clearly you've got to move from that overweight position in gold to an underwent position.
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>> okay, let's get to today's selloff edition of "pops and drops." were there any hidden gems out there. berkshire hathaway, karen? >> there's a compelling story that was told yesterday at the boys and girls harbor about them being added and the reweight in the s&p. that was compelling, as well as the undervaluation. i was intrigued. i would be a buyer. >> drop here for akamai. >> the problem was the stock just is a little bit broken here in the tech space. because if the best stock in the tech space today, cisco, couldn't manage to hold on to gains, certainly akamai can't either. i would be looking to get into this stock around the 24 level. >> steel dynamics, down 7%. >> it was on the goldman sachs buy list. i know steven not really favoring the steel names right now.
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steel dynamic, i don't know if i play from the short side, i would actually be looking on another pullback to acquire the name. >> massey energy was a drop, 8%. >> longer term i would be in the name. right now it's selling off. i would stay with it near term, take another look in maybe another month or so. >> a drop here as well for yum brands. >> a little more like yuck today. i do own it. i think here's one the long term story is intact. they weren't fabulous, but i like yum here. i would buy more. >> casino stocks across the board pretty much were dropped. >> they were and they should be. but i would be an aggressive buyer of these, because i think they're -- >> which one is your favorite and what levels? >> i like mgm and wynn a lot. even though mgm has city center as well. i know that. and wynn he's the best operator on the strip. >> he being steve? >> yes. >> delta airlines down today, joe pop it's a theme i agree
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with. i played continental on the short side this year. i agree with thesis airlines are a sale. >> a pop for burger king, up 3%, steve grasso. >> i think you saw it run right into earnings. it will probably pull back just a bit but i'm still bullish on the day. >> even though they have a creepy mascot? >> yeah. >> did you meet him on the new york stock exchange the other day? >> he licked his hand before he shook mine. >> don't want to slander the king. commodities collapsing. up next, the stock that turns this panic sell into profit.
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welcome back to "fast money." we are live at the nasdaq market site in times square. sara lee in the midst of a company turn around, and nearing a 5 -week high has reported a blowout quarter today. ceo brenda barnes, as the saying goes, nobody doesn't like sara lee. what's secret ingredient? brenda, great to have you on the show. >> tharng for having me. >> commodity prices certainly
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helped the quarter. given the situation and concerns about sovereign risk debt around the world and the dollar strengthening, where do you consider the stock to be? lower, higher? >> as we look at the protein complex, we see some up tick going on there, after a significant swing in that area over time. s coffee will be relatively stable. that's based on supply and demand. and wheat has come down. we expect it to stay relatively close to what it is right now. >> is that one of your biggest inputs? >> the three i named off, wheat is our sara lee bread in north america, and then coffee, we are, you know, one of the biggest coffee suppliers in the world. that affects us. >> it's karen finerman. your stock is intriguingly cheap, yet i couldn't help compare your margins to some of your comps. why is it you seem to be -- have
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thinner margins than they do? what's that from? >> i like what you say about our stock. we think there's a lot of value there, too. but we've been on a major plan over the years to increase our margins. you know, we started out quite a bit lower than what we are right now and we've been on a plan to focus on certain categories that over time have greater margin opportunity. at the same time, we're restructuring things within the company to drive our costs structure down, build stronger brands and expand geographica y geographically. so it's that path that we've been on, which is way i think -- you know, our earnings this quarter were so good. >> ms. barnes, just a quick question. a lot of what you make, of course, is consumable. some of the stuff like body products and so forth are not. is there a possibility that you could entice karen and i into the stock by telling us there could be a spin off in that direction? >> we announced a while ago we were sell selling our household and body care condition. we've already announced a sale,
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biening sale to unilever and proctor & gamble on our air care business. we only have a couple of small pieces best we're in the process of divesting. >> the remainer of the operations that are underperforming are not related to your core business. can you quantify that for us? is that the next quarter, two quarters? >> well, it had to be basically in the next year from the time we announced that. so about half that year is over, so probably the next two quarters. >> okay, brenda, a pleasure to speak with you. thank you so much for your time. brenda barnes, ceo of sara lee. we want to check what the euro is doing in the after-hours session. it is showing some strength. we are seeing it there stabilize, which could be a good sign. we will have, of course, an extended final trade right after this.
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>> we' got a very special final trade for you to get you set up for tomorrow. b.k. what do you say? >> i'm looking at this market and perhaps it's because we're in an extended bear market. you're really starting to see a
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slowdown of the inventory cycle. i would be long the u.s. dollar. i'm going to be using any strength to take profits in any positions that i have, and then finally, if you absolutely have to buy a stock and you can't keep yourself away from the stock market, i would be in the grocery stocks. they're consumers, staples, people have to eat. so buy something like super value. if i had a chance to buy it around 12, i would be a happy guy. >> thanks for working the prop sd desk. joe, what do you say? >> i say buy some hershey. eat some chocolate. >> abercrombie, cheap around these levels. they've finally got their act together. and tomorrow, i think i have to wait until the dust settles. >> karen? >> i like cvs. nothing happened today that i think materially affects that business. i like the stock right here. >> and dr. j? >> super bowl sunday, so i like the colts and given the points, i like pepsi, but i'm buying
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proctor and gamble on any dips. i think p & g looks great at these levels. >> thank you for sitting in your brother's seat. >> do not make any major portfolio decisions tomorrow. wait until next week. see how this unemployment plays out. >> got it. i'm melissa lee. thank you very much for joining us tonight. see you back here tomorrow at 5:00 p.m. for more "fast money" on cnbc. have a great night.
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>> i'm jim kramer. welcome to my world. >> they're nuts! >> i always say there's a bull market somewhere. >> "maud money." you can't afford toe miss it. my job is not just to entertain but to educate and explain what
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the heck happened today. call me, 1-800-743-cnbc. days like today frighten. they scare people. they scare you. they scare me. we see some countries in europe -- spain, portugal, greece -- having financial prons sutdly every stock you own goes down? every stoke in america? we take it as gospel that it makes sense. hey, it was on our screens. we hear that emerging stock markets are due far fall. we see brazil get clobbered. we deserve the punishment. we should be slaughtered because well, we're being slaughtered. we accept that it's right that the dow got clocked for 268 points and the s&p was crushed for 3.1%. we accept that's right, simply because it happened. i am here to tell you that just because it goes down, just because everything went down today from oil to gold to stocks doesn't make it


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