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tv   Fast Money Halftime Report  CNBC  January 25, 2022 12:00pm-1:00pm EST

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imagine the people watching the nasdaq every minute as opposed to building long-term great products for their customers. >> the perspective from todd mackinnon, carl. >> we've talked about the space all along, and some of the risks that are just now coming to light. we'll find out more in the days to come along with microsoft tonight. let's get to the half. carl, thanks so much welcome to "the halftime report." i'm scott wapner front and center the latest on the market volatility whether the great reversal is a sign that the worst of the selling is over and the investment committee debating where we go from here and where the best place is for your money right now. joining me for the hour shannon saccocia, jim lebenthal, josh weiss. sliding, but not at the lows of yesterday and that's an important point to make.
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jim lebenthal, i will begin with you because it was a pivotal call we had yesterday when you called in and you thought we'd bottomed and that was a capitulation, that you were a buyer of stocks and that you would be a buyer in the last hour of the day yesterday in which you followed through and did just that. you bought more apple and qualcomm in the afternoon aftering buying more twilio, and greenbriar, but take us through the process yesterday. >> great show yesterday. thanks for having me on. i did say that was a capitulation trade what i may not have made clear, that doesn't mean you go marching straight higher that reversal caught me by surprise and on the basis of that, it's not surprising we're there today. we have a fed meeting today and tomorrow that we'll get an announcement from that the market's lanhanging on and you v ukraine versus russia going on i think we'll rattle around this
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level for a couple of days, but under the heading of trying to be helpful, i wanted to say this yesterday, i think it is way ahead in firms of being hawkish. what i expect the fed to do is yeah, we're going to be raising rates soon and we'll complete the taper in the next couple of months and we'll raise rates i think they will also say we're going to be data dependent meaning raise rates in march, 25 basis points and none of this 50 basis points gar ban and that's analysts trying to make a headline see what happens there's absolutely no reason that powell will be raising 50 basis points and there's unde indication will come down and probably will be and the fed will be data dependent so yeah, i think we bottomed and i still have 5% cash in the next
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few days we'll probably put that to work. >> that's the words that i'm going to take from our interview just now steve weiss, you covered all your shorts and freeport, the qs and roblox, the smh and you sold the sark, and the short ark fund which obviously had been a big winner as those -- as that fund has gotten hit take me through the way you're thinking about the market. do you agree with jim lebenthal that we have bottomed and we did that yesterday >> you know, actually, part of the reason i took it off is i spoke to jim after the show yesterday and i bought some facebook after the show so i expect some pop. i didn't want to get biggish the shorts worked out extremely well i'm still only 55% invested i'd say at this point and rather than shorts i have a lot of cash because i've shaved a lot of positions. i don't know that we bottomed.
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i tend to think that we haven't, and the reason i say that is that the market's got to get accustomed to us being in an extended tightening cycle and yes, stocks go up in that cycle, but this is an unusual time and it's not a fed cycle where the fed tightening will have an immediate impact on inflation. at least that's my view because inflation is caused by the supply chain and not only demand, and i think at this point, part of the wealth effect has driven inflation as well so the fed doesn't care about a fed put. no such thing exists in this market going forward and we have to think about how we got to where we are and it's incredibly easy money for an incredibly lock period of time, free money and i think people will be less inclined to go into the market and view it as the riskless trade that was for the last few years. so when i go in and buy, it's
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not going to be the snowflake and the docusigns. those are done sure, they'll pop and go here and there, but at this point you want to get back to valuation. >> something you just said is interesting. so you don't think the fed cares about the disruption in the market enough to do anything about its policy moving forward, is that what you're saying as well because that's what it sounded like, too. >> yeah. that is what i said. let me just make that a littlemore clear which is that the fed is muchm more focused on inflation. we had a couple of days going forward like we go at the bottom yesterday, then i think they'd come out and try to quiet it dunn, but i don't believe they're going to get off the timetable for raising rates regardless of the market it's a much bigger priority. dow's down 370 down more than 800 earlier today after yesterday's slide. by the way, at the lows
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yesterday the dow was 33,150 okay so even though we're down right now we're considerably higher than where we were yesterday and that is the same story in each of the major averages as you look at the declines and how far we were from the lows. we obviously recovered a fair amount from that and still remain significantly below a lot of the lows and i look at our sheet here you were a buyer as well you bought more dutch brothers and matterport and you have other bids in, but i'll talk about the names that are within the bids, but let's talk about dutch bros and matterport. why did you buy those yesterday? >> well, all right so let's start with this neither one of those ought to be taken as emblematic of my market opinion. matterport is one of the biggest disasters in my portfolio and maybe the worst. this is the stock that i had an
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average cost of $14, $15, and it went up to 30, round tripped and now it's at nine it has not done well and i look at a lot of the selling i see there, and i can only conclude that some of it is for selling from momentum players, or high growth tech funds that are being redeemed so i'm adding a little bit there and bringing my average costs a little bit lower i never thought i'd have this opportunity and a lot of things have happened, and that has nothing to do with how i feel about the overall market dutch bros is one of the strongest stocks on the tape right now. it was one of the first to turn green yesterday. there was really big news about coffee sales in general, outpacing all of the other restaurant sales in the month of december i think this company will have really good results and it's a tiny market cap and a couple of billion, but i expect volatility and i see a really ugly tape
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>> i couldn't help myself, i'm starting to buy for the first time and get my feet wet >> that being said -- hold on, i agree with what both lebenthal and weiss had to say i think to jim's point you don't have to buy the bottom, but you can start doing constructive things whether or not you think the overall market is going straight up. a lot of people will be disappointed when we don't get that immediate gratification that we've all become accustomed to over the last couple of years. i don't think we're going to get it, but that doesn't mean there aren't stocks that are buys. number two, to weiss' point, there's no reason to think we've seen the worst of this because all of the price action is terrible even if you look at the dow components that have just reported pretty good earnings, the reactions there other than american express are not good. ibm should be double and it's not. the reason why that matters is
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because we're going get microsoft and apple this week. i think both of them will have incredible earnings reports. if the market doesn't care, that's really not a great sign for where risk appetite is and to me that's going to say that we have more work to do to the down side. think about how big and important those two names are, so that's my bigger picture market opinion outside of any moves i might have made yesterday. >> shannon, i'm coming to you last on purpose because rather than being a buyer you're a shopper. you've been looking at things with the way the market declined so dramatically. what, if anything, have you done in the market and what are you specifically looking at? >> not yet, scott. i think there is an asymmetric opportunity tomorrow for the fed to screw up the press conference, and so i'm a little bit more hesitant to be an
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active shopper ahead of that because i think it would take very little for powell to make a misstep in the presser, not necessarily in the statement i don't think the statement will be mindblowing if i'm looking at some of the things that are potentially opportunities, both to the three gentlemen that came before me, to their point, the fed is worried about outcome and what is this summer regardless of how many rate hikes it will be and what is the economic perspective later this year and there are areas such as retail and semis that i think we will discuss later in the program that could potentially be additions to the portfolio today to create the opportunity for additional gains 12 to 18 to 24 months from now and it's not that to say there aren't opportunities that jim is buy, as well and those are names
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that i actually own in my portfolio so i don't want necessarily know that i would add to my positions there. i'd rather be looking at the areas where i think from a cyclical perspective, align with what the fed is trying to deliver as part of this rate hike coincident with the fact that i believe inflation will be coming down in the back half of the year and that will limit the need for the fed to get really active >> josh, we've had this conversation with you and you've probably been the most outspoken and the dislocation in the market and that the fed, the market is doing the fed's bidding by the pullback and the tightening of financial conditions at least from a wealth effect standpoint do you still stand by that because ed yardeni is out with a note today and joins us yesterday and the temper tantrum is unlikely to change the
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hawkish course of monetary policy and here's what jim chanos said which you can react to on the other side >> the idea of a fed put and the fed will always be there to bail out my bad investment decision is not a kocogent investment strategy to hold on. at the ended of day we all obsess about the whaed is doing and the fact that it will bail out the stock market at some pre-determined level of losses i think is a very dangerous idea to run hold. >> reaction? >>. >> i think that's mostly right i don't think the fed is aiming to bail out the stock market however, i think there is a little real politic going on in that the fed understands that a lot of the drivers of inflation, not all, have been from the wealth effect. we've had the price of existing home sales hit a six-year high
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you can't have 20% price appreciation in the average home in the united states and not expect that to be an inflationary pressure elsewhere. so people that think that they're ritual of a sudden are spending money on other things you had that same phenomenon going on in the auto market. you had the stock market fuelling this wealth effect and bitcoin didn't help and any company was able to go public with no problems and insider selling of appreciated and inflated stocks. all of that is part of what's driving the inflation. so i think a couple of things are going to happen that will give the fed leeway to not be quite as hawkish as everybody thinks the first is every year, not just this year you have seasonal inflation that completely collapses. we r huge imports in the month of october to get ready for the holiday season and then we have huge consumer spending every december this is not a surprise to
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anyone that is already collapsing the second thing is capacity is coming back online so a lot of the shortages and the supply shots and blah, blah, blah, that everyone is aware of, is a factor and it is what it is if you look at the ships outside of the port of l.a. and it's improving. it's not great it's still there, but it's getting better and then the third thing, if wooe going have this continued cooling off in the markets and by the way, housing prices, four straight months of moderating although at record high levels, it's not increasing anymore if youwill also have them in the stock market so we start the year with a 15% correction in the nasdaq, that's going to cool off spending and animal spirits among consumers so a lot of what the fed has accomplished, i think, is getting it closer to its goal of calming things down and that will keep it from
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having to do emergency hikes, 50 basis point hike i just don't think they're going to need to they will if they need to. i just don't think they will maybe i'll be wrong. that's where i stand right now >> may i comment on this josh has definitely been loud or this is that the fact will react to the stock market. the counter argument is what jimmy chanos said that the fed is not going to bail out the stock market from bad decisions. i'm pretty sure what he's referring to there is gamestop, amc, nonfungible tokens. i'm pretty sure that's what he's referring to, if apple were to pick a name out of the hat, if the multiple, if someone buys it at 27, 26 times earnings and it goes down to 20 times earnings, that was a different story and that's the market saying something is dramatically wrong that is affecting the economy and the fed does need to react to it. so if the counter argument is that the fed put is to bail out
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bad actors, the person buying apple today and yesterday -- >> the mere notion that some are waiting around if the fed to be more dovish tomorrow for jay powell. >> they shouldn't -- >> that they would be mistaken and if they were, that in and of itself would be to some degree, quote, unquote, bailing out the stock market >> that's always the case. that's been the case for as long as i've been alive i like moralizing about it, too, but the fed has bailed out the market for decades. >> but -- but maybe this time it's different i think the whole point is maybe this time it's different, right? maybe this time it's different. >> they have no choice >> let me say one thing before you go i tried to say this yesterday, analysts have been falling all over themselves to be hawkish
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and it became four rate hikes just relax and they'll end taper in march and then they're going to see what happens, they're not going to commit to four rate hikes. the whole point is the market has committed to it because if you look at the markets, they're at all-contract highs and they have been in terms of what the market is predicting what the fed is going to do let me add another voice to the conversation before someone else jumps in nancy davis of quadratic joins us now >> it's good to have you back. >> i think you kind of agree that the fed backs off a little bit, you suggest and we believe that the fed will take its time to evaluate its economy before
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embarking on a swift cycle and a balance sheet reduction plan do you think the fed is moving too fast >> the forward guidance have been effective and the rates market does not believe inflation will stick around. we've had the biggest forward flattening in the yield curve and the 18 month forward is 15 basis points is in the yield curve. the market has already adjusted to a wildly hawkish fed, and i like to say that talk is cheap forward guidance has worked and it's tightened financial conditions and so i also agree with josh, and i don't think there are going to be that many and right now the market has priced in almost four rate hikes this year in 2022 and with midterms also this year i think that's a little aggressive. >> how are you positioning yourself right now light of what may happen tomorrow >> well, we're waiting to see especially about the balance sheet. i'm pretty excited about if they bring in the balance sheet to
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the discussion because that i think will likely steepen the yield curve and that will be beneficial for taking the financial inflation that wooe seen in bond market, credit markets and taking it and moving it to main street. the whole point of the macroprudential initiatives to capital to extend credit and you need a healthy, upward sloping yield curve because why would i lend you money out for ten years if i only get paid ten or 15 basis points more. so you need a healthy yield curve and i think the fed talking about the balance sheet reduction would really help to normalize where we are in the rates market, because the rates market is priced for disinflation and a really onerous outcome right now. it's not looking healthy >> yeah. steve weiss, you want in
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i guess we'll find out what kind of pipes j. powell has, if this is going to be a lot about talk. >> well, look, here's the dot plot it sort are gives you what the fed's feel is, and the different governors that they're going to do or what needs to be done in terms of interest rates, inflation and the economy. and they laid that out, and more than fed and the less and they'll get tightening i think powell is not going to reverse from its hawkish viewpoint, and i don't think he'll double down on it. he'll continue to say what he's been saying. i also think it's ludicrous to say if apple goes down a few multiples that the fed is going to save you, but if some of the others go down it won't. >> the fed has and i repeat this, the fed's primary focus right now for the good of the
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country is taming inflation with the only tools they know how they're not going to balance the market trading down, which by the way, despite the decline is at the five-year average p-e. >> so should it be at the five-year average p-e when rates have been zero for the last five years or should it be lower in the tightening cycle of course, it should be long >> rates are 175 on the ten-year rates are 175 on the toen year. >> no argument. >> this hysteria is simply too much and it's not helpful, okay? yeah, the fed will tighten we know the fed is pivoting four, five rate hikes and inflation is out of control and inflation has been high and it has every indication right now of rolling over and the fed's aware of it and what nancy just said about a flattening yield curve is a pretty powerful topic that i think you know. i think you're getting carried
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away, steve, i really do >> jim, i don't think i'm gettingcarried away, and if i' getting carried away, then the futures are getting carried away >> let me finish. >> jim. >> jim do us all a favor, jim when you toss it to someone like steve weiss can you let him finish because i can't understand a word he's saying. i'll come back to you, i promise. steve? >> thank you the facts are the fed has to tighten. they can't sit around and wait any longer for inflation to come down whether they're right or wrong and i'm not going to opine whether inflation is right or not. powell looked like a complete moron further destroying his legacy, and if he pivots again, i was only kidding and inflation is transitory again. no, they'll stick with the party line it's not hysteria, and i prefer to see where the puck's going and we'll have permanent free
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money forever. >> that will not be the case >> don't even think for a minute and not that the fed would ever say it and maybe they would and they would have to be happy with the fed that it would come up with the most frothy parts of the market they don't want to be accused of inflating a bubble any larger than they've been accused of inflating that we all know and talk about every day nancy davis, let me ask you this if you look at the price action on the market yesterday. do you think yesterday we put in a bottom what do you make of how that traded yesterday and what kind of retests we may endure over the coming weeks, if not months? >> it depends what time of the day you were talking about, because around noon it was not feeling so great right? we were definitely looking equities were signed off and markets were jittery, but i think this is all normal day to day investing is just so tough and investors should be
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focused on it is long term and having a diversified portfolio, the fed has been very effective on bringing down forward guidance the rates market and the interest rate markets do not expect inflation to be anything other than transitory and you can see that at the ten-year yields and where you have cpi prints and the last two above seven and the last two above six and clearly the rates market doesn't believe inflation is going to stick around. so i think the fed has been effective on bringing down forward guidance you can also see that in the downward sloping, break even curve. i think the question is whether the market expectations for heights seems a little overdone to me with about six priced in before the u.s. election >> what are your expectations of volatility moving forward because that's where you made a
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name for yourself with really great trades so when i have you on i think of you in terms of a good eye on volatility what are your expectations >> well, at quadratic we try to educate investors especially fixed income investors that if you have past indices or benchmarks to core fixed income like the bloomberg ag index, a third of your portfoliois shor volatility from the mortgage exposure and you just think about it and u.s. homeowners can pre-pay their loan wherever you want, whenever you want so the owner is short fixed income volatility and so we always try to say it's very important to also have long volatility in fixed income a lot of people think fall and they only think the vix. the vix is one index and its s&p volatility and anything with the options market has a bond market so we'd really like to encourage investors to also look at some of the quadratics access
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products to the fixed income volatility markets because if you don't own volatility you're probably short it already. >> interesting do me a favor. i'm not sure what your schedule is, if you can hang over the next break because jon najarian will talk about volatility and some of the trades he's seeing and maybe you would want to opine on that. i know you have more to say in the conversation and i promise to bring you back in we'll take a quick commercial. we'll come back and we'ltal lk about that and more coming up. or necessity. we can explore uncharted waters, and not only make new discoveries, but get there faster, with better outcomes. with app, cloud and anywhere workspace solutions, vmware helps companies navigate change-- meeting them where they are, and getting them where they want to be. faster. vmware. welcome change.
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welcome back i'm rahel solomon and here is our cnbc news update at this hour the s.a.t. is going digital starting next year today the college board is announcing several changes for the entrance exam taken by millions of high school students each year. they'll be answering questions on a digital device for two hours instead of the current two-hour paper test, but students still have to go to a school or testing center the test cannot be taken at home >> altimeter use at airports the move will allow about 90% of american commercial planes to make low-visibility landings and the new 5g zones athens still digging out after a
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rare snowstorm that trapped thousands of people in their cars on a major highway. overnight business the storm hit much of greece and turkey dropping two and a half feet of snow in some places. boris johnson says he welcomes a new police investigation into whether several events, some have characterized as parties involving his office staff violated covid lockdown rules. already the subject of an internal government probe with a report expected within days. >> rahel solomon >> jon najarian, co-founder of market >> what are you seeing in terms of trading regarding volatility today. >> we've seen a fair amount, scott of the same sort of protection, i'll call it people buying big, upside call in the vix and that's something that you would expect. you know i'm going to say this, as well, that pete and i focus
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on volume, volatility and velocity did we have volume yes. we exploded in volume like 20 plus million more complex on the options side than we've been seeing in the last several weeks. the last two days, that is, and today it looks like it will be another one in the record books. so that volume is there and the velocity with the bounce that jim so accurately called yesterday and then you have the volatility and yeah, we spiked up to basically the highs that we've been at in the last year, today, scott, i'll note that 72 thousand of the march 70 calls in the vix were purchased. that's 7.2 million share equivalent and nancy and i pay attention to, and i think a lot of the people have now gotten some of that protection that they need, scott i'll point out one thing quickly that one of the reasons that i think we may have been very
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close to that bottom was volume. certain that velocity move off the volume and the fed can't just walk away from the stock market they're not going to be there to support the gamestops and all those things that jim said and chanos was implying strongly, as well, and they're not just going to have the markets back, but on the other hand, if they crush the market that means businesses won't spend. that means businesses hunker down, they hold cash, they get rid of employees and all of that kind of stuff and all of which would be bad so that's why i think powell will still talk tough, but they won't do much and that's been my prediction for the whole year and that's where i think we are. >> the proof is going to be in the pudingding and you want to comment on what jon najarian was talking about? >> i think jon's points are all great. the point is investors need to be diversified and having volatility as an asset class and
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using long volatility especially and short volatilities correlated with equities and i think the start of 2022 has been a remind toreer to investors tht stocks and bonds, and having a diversified portfolio and a little bit of a lot of things that are different can really help especially investors who have that traditional 60/40 portfolio. so definitely owning some amount of volatility whether it's equity vol or fixed income vol and anything with the options market has a volatility market because volatility goes into pricing options. >> thank you and thanks for your patience and that's nancy davis. jon's brother pete is making moves, as well, not on the show with us but he is going to call in next as well to share with all of you when he is doing in this wild and crazy market there's your look at the major
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averages the dow is down 376. again, it was down more than 800 earlier today. not at the the lows of yesterday think when it was down 1115 points at one point. there is the s&p off 2% and the nasdaq, it's the epicenter and it's down more than 3% at the 0-ment pushing a nearly 40point decline, 13,461. we're back with pete after this. the pursuit is on. the pursuit of outperformance at pgim. with deep expertise to outthink across multiple asset classes, actively managing investments in the world's public and private markets. outscale, with the resources to serve 1,500 clients in 52 countries. and outlast, with long-term conviction that looks beyond today's volatility.
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i have another buyer pete najarian. pete, are you there? >> i am. how are you, scott >> i'm well. co-founder of market with your brother. >> paypal, as you remember in december and i thought it had finally reached the level that made more sense and right around 180 and it created pretty well and because of what's going on in the market right now, we're seeing a lot of different names, they continue to have incredible growth their earnings per share continues to grow through the last three or four years and it's double digits with double digits with sales growth, and all of that.
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when you look at the p & e, but it's in the 30s and -- [ indiscernible >> unfortunately, our signal is horrible so i got the trade in paypal it's hard for our viewers to understand the reasoning why you added more other than the fact than the valuation had come in can you tell me if the stock came in and we have a phone connection issue and i'll let you run and at least know the name of what else you bought >> sure. [ indiscernible >> i'm assuming our producers know at this point know the name can you show it's citigroup, and i understand it's a new position for pete i apologize to all of you for the bad connection, but that's just the way it works out sometimes. pete adds to paypal, as he
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mentioned and he bought citi it's interesting, shannon. a lot of notes on both sides of the fence in terms of whether now is the time to buy or not. wells fargo says it is time to put new money to work like pete has done, jim lebenthal has done and we cite him all of the time. the bearishness in equities is overdone savita says buy some dips and she would prefer you buy rather than others and the flipside of all that, shannon, is barry, no bearish to market calls over the years. he calls what happened with the comeback a headfake. there's s&p downside to 4200 barclays says it's too early to buy the dip. fund stats and technical strategist is talking about a retest looking more likely and maybe that's in part of what we had earlier today. >> i think nancy and it's about
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time horizon and if you look out 12 months after the rate hike and the s&p 500 averages 7% or so since 1994. i think the thing that i'm focused on here is that we have gone through how many minutes of this show and we haven't yet talked about earnings season, and i think that that is to josh's point from earlier. there isn't much coming out of these corporate earnings that's promising and so therefore we're not seeing the upside, and i think the reason for that is this question about economic data bad data is bad data right now so for these companies, they're not sure if the fed just by hiking rates a few times this summer can actually deliver improvement and inflation. they need to be very careful about their projections particularly for margin in the back half of the year. i think what we're seeing is this perfect storm of decelerating economic data, a fed that's acting and this uncertainty and i think that that's why we're in this situation we're in could we retest?
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absolutely >> you just maybe inadvertently walked into where i wanted to go next since we are here 40 1/2 minutes into the program where we haven't talked about earnings yet. let's do it now, right microsoft is your biggest position microsoft reports after the bell tonight, right and i just wonder now given everything that we've been witnessing in the market and how much that stock has come down whether more is riding on that than might otherwise be. >> i mean, you'd like to think so given the percentage that that stock makes up of the index and how widely held it is, but again, what's the upside here? they're probably going to deliver a great report and there could show some compression in margin that is overstated in consensus right now. there's going to be questions about their activision acquisition and microsoft does not have the best experience in delivering on consumer buys that it's made and so there are going
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to be questions on that, but in terms of what can it do to deliver something like the performance we're seeing from it, american express today i don't think much i think it's important that they come in. it's going to be about outlook the reason that ibm is positive or was positive when we started the show today is the outlook for enterprise in the back half of the year. we need to hear strong comments about cloud. we need to hear strong comments about enterprise spend, but i think these companies are being very careful because they're not sure if all of the supply chain issues that weiss talked about earlier and that are driving the inflation that we're experiencing are going to be remedied, and so i worry and i am worried less about revenues and i'm not as worried about the margin and coming back to the outlook and the fact that these companies cannot put all their faith in the fact to trust the process that we're going to end up delivering that improved
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inflationary outlook in the second half. >> josh, how about this? >> web bush on the pending tech earnings says the following, quote, we believe and we view this as the most important earnings season for the tech space in potentially the last decade i believe that's dan ives who puts that forth today. what do you think about that >> so i think it's less about what the companies actually have to say let's just assume earnings will be good. there's no reason not to given the recent track record of most of the companies that we're talking about, so let's just take that as a given, right? that consensus is close to what they'll do and they're all pretty savvy about what they can beat by a couple of pennies and everybody normally would be happy. that's not the issue as i mentioned, the issue is the market's reaction to those quote, unquote, good earnings. it may not be what we need it to be in order for us to see that
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monday was the bottom. these are gigantic stocks and they have a huge impact in what the overall tape does and look at 3m had really good earnings last night they said that inflation concerns are moderating and they say that omicron is going away it's not helping it's not helping and i mentioned ibm before so for me it's not the numbers it's the reaction to those numbers that are going to give me more or less confidence that we've seen the worst i really don't think we have i think the nasdaq being in a 20% or more bear market is likely and the s&p, what are we off? 8% from the high, that's nothing. we do that every two years on average. >> not to mention the fact i'm not rooting for lower prices i just feel like people have to get comfortable with that possibility. >> and given the fact that tech is such a large part of the s&p, if you get the nasdaq to where you think it may go, the s&p will be dragged down, too. so i feel you on that.
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>> by the way, microsoft from 350 to 287 it's been a serious pullback you own microsoft shares and you have puts, as well so you're hedged out here. >> i am, as i am on apple where i own puts as well and i do it on the others and they're so expensive. the stock traded down because ibm talked about how much headway they're making in the cloud. so the question is is that coming at the expense of share and is it coming at the expense of price so that's what i'm interested in hearing on microsoft and i don't them to confirm any of that. that's not what they do. we have to watch that going forward. look, you lostvaluation in the entire market so it's natural for all stocks to come down including microsoft. >> all right good stuff the committee's busy today we'll take another break we'll come back, stephanie lk making some moves that she wants you to know about. we'll do that next
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stephanie link was making moves. she joins us now steph, i not to be honest. i did a double take when i saw you sold amazon. it was underweight already in your book, but you sold it completely why? >> i'm surprising you a lot lately with the faang names. i was up over 300% i'm not happy the first quarter numbers and the full year in your opinions are coming town
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because of commerce. i think a lot of good news is it i don't like the way the faangs are trading. i am a big believer in facebook and apple. those are the names i've been adding to over the last six or eight weeks. those are any bets in faang. >> you recently sold out of alphabet and put that into meta, facebook >> yep that's a big position for me now. >> you al sold lam research and bought more mcdonald's and nxp >> lam, i'm up 200%. i am worried about in addition to profit taking is double ordering i'm starting to hear a little bit of that. and i'm concerned given this valuation what it's done in the last two years it's good to take money and put it into nxp. i like auto and contactless payments also they're buying back top schlu schlumberger, just listen to the conference call. they're talking about a super
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price increase in a tight market mcdonald's, i love this. this is the defensive name in my portfolio i'm making a big bet on >> steph, i appreciate it. we'll get ge next time there's stuff to talk about for certain there. i've got to run. >> there is. >> i appreciate you popping on with us. i promised you tom lee yesterday. i'm going to bring him in now. we had technical issues yesterday. he's with us now on the phone. tom, can you hear me all right >> yeah, scott, how are you? >> good, thanks. did we bottom yesterday? what are we supposed to do as investors now? >> well, as you know, when selloffs start, you never know when they're going to finish but we've already seen such a big reset, that i -- you know, i think unless someone thinks the economy has turned, and the bull market is peeking, and that's not our view right? these are great entry points for people because you've got so many stocks down and yesterday had
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the feel of bet me out of everything, which has been part of this buyer's strike so yes, so the bottom line, scott, is i think people have to look at this as a really attractive opportunity in 2022 >> you know, i am pulling from a note that you guys had, and i think it was from your technical strategist newton retests look likely. >> mark newton >> you're seeing it's a buying opportunity, but some of your people, at least, are thinking that we're going to have retests. right? that this today is likely not the only one i want to be clear on exactly as we're telling people now is a buying opportunity, that it could be turbulent moving forward. >> that's right, scott marx euro-- for anyone who wants to use technical and buy industry which is what mark is trying to provide insights for, someone who wants to find a tactical low, you know, when you
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hit the bottom and everything from there, the selling is completed. according to mark's work, we're not there yet. but for someone who is thinking about where the market is six months, 12 months from now and that's how active managers have to manage because they're not trying to necessarily catch the bottom, but they're trying to find good entry points we're already-- in many points we have more than 20 we've seen it in the vix spike and we've seen it in the inversion of the vix curve and the percentage of stocks now around 50% these are levels associated with an extremely oversold market to me, the one thing people have to remember is if they are participating in the buyer's strike, the recovery can be violent. and then they're going to miss potentially over three days, 5%, 6%, 7% gains for me, i say those tax minded six months out, this is a great entry point. >> you're still sticking with your second half of the year
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could be good still for stocks despite what we're feeling now, and there's a hangover to that, a hangover affect to that as well >> yeah. and if anything, i would say because we thought the first half would be tricky, and that the highest probability of the 10% drawdown would take place. we're already here i almost think now we priced in so much bad news that we're at the apex of the fear, and that means it may end up being a big buying opportunity >> you still feel that if you look at certain areas of the market, i can easily make the case to you that there's still a lot of froth that needs to be worked out maybe not in the overall market, but certainly in the quadrant of the market that's already gotten hammered and it's still not been down enough. >> that's right. i would say the market feels
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fragile, but when everything is still fragile, and we think a lot of things are half empty, because we're fearful of the fed and the geo political tensions because inflation, that leads to pricing and a lot of bad news. i think it's the perspective that's important to keep in mind that doesn't mean to get out of stocks autoall costs does mean first half is going to be treacherous which it's proven to be, but this is going to see a great setup for a second half. >> give me your view lastly as well it was notable as bitcoin was the first to go green yesterday, and the overall market followed. what's the message, if anything, in that, and how do you expect crypto to trade from here? >> you know, i mean, bitcoin, i think the selloff that's been synchronized between crypto and equities shows that a lot of the new wallets are basically risk
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on dollars mainly u.s. accounts and so crypto inequitiesare going to be sort of linked, but is the bitcoin narrative broken? it's not, because in some ways bitcoin has become a much more attractive project because so much of the money has moved to the u.s. so the power is now a u.s. hash power. there's a lot more payment rails coming, and i think the adoption is continuing to grow, and really, that succeed to bitcoin is more wallet so i mean, it's been ugly. crypto, you know, is a hyper volatile asset class, and when the vix is hitting 40, crypto is not going to have a good week. so i think we're just seeing sort of a darkest of days now, but again, i don't think that's where we are in june >> tom, you're a good man. i don't know where you are i know it's somewhere good, but i appreciate you calling in. and having this conversation >> yeah. >> a day late, but never a dollar short tom lee, thank you let's wrap it up with the
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investment committee jim, sounds like you have some company. >> yeah. steve and i got into it, but it was a robust discussion. i place very little predictive power in the fed funds future market and in the dot plot historically they've been shown to be borderline useless >> give me a final trade if you could, jim >> i'm with pete on sciti group it lagged last year which means it will catch up this year >> shan. >> not to jim on ukraine add defense here >> josh brown? >> berkshire holding up better than many stocks i think it will continue >> steve >> no rush to deploy cash. i'm staying this cash right now. >> yeah. steve, quickly too, we only have thirty-seconds left. how critical are the next few hours leading into microsoft >> i think they are somewhat
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critical, because if you see another pop, then i think it will suck more people in the market, but that's not going to determine that the bottom has been reached and held. >> yeah. it's all going to lead up to tomorrow again, the fed making the decision on rates. the press conference from the fed chair, jay powell. that's going to do it for us appreciate you watching. there's the dow. down more than 8 00. now down 366 i appreciate you watching the program. "the exchange "begins now. >> will the bottom hold while the market is down again today, the dow is above the intraday lows from yesterday afternoon. same for the nasdaq and the s&p 500. our stock picker has several names she says are oversold and you can still buy right here we'll tell you what they are plus billionaire investor joins us live with his take on the selloff. we'll also ask him about oil prices as well they're back up to 85. does he still think rates are going higher from here you don't want to miss it. microsof


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