tv Fast Money CNBC March 28, 2022 5:00pm-6:00pm EDT
we asked what should be the next stock to split berkshire hathaway and booking and chipotle on other. santoli is getting an eagle boost. chipotle, 44% and that was his pick and that is your pick thanks for joining us in "overtime. i'll see you again tomorrow. "fast money" begins right now. live from the nasdaq market site overlookk times square, this is "fast money. i'm melissa lee. tonight's lineup, tim, mike and karen and steve. ahead on fast, a crude collapse dropping 9% to start the week. energy stock as mong the worst performers as is it a sign of a global slowdown. and plus the bitcoin bounce. back in the black for the year bitcoin serving more than 16% in the past week. what is behind the rebound and where do we go from here and later amc may not be a oneoff why this meme stock might not be
done doing transformational deals that have nothing to do with movies or popcorn but we start off with a massive milestone for tesla. climbing back into the green for the year after surging more than 8% today the biggest one-day jump since january. that move adding nearly 85 $85 billion to tesla market cap. more than ford or gm after the company announced it would look into splitting its stock and paying out a dividend to shareholders. they helped lead markets higher with the nasdaq rising more than 1.3% so what do we make of this move. these are the big moves that are the big events for tesla >> they've been monstered and if you go back to the august of 2020 stock split, it put the stock up about 75% over the course of the next couple of weeks. the s&p inclusion for tesla also later on that year was worth about 115% over the course of about 22 sessions. if you look at tesla and their move off the bottom along with markets, it is about 55% over the last 20 sessions which is
very tesla-like. and again, this is just a function really of tesla's role as the high beta, high multiple tech company that sits at the top of the leaderboard the facts that we've seen these types of moves by tesla by this allegiant fan base which is their investor base doesn't surprise me. >> and they are a mega cap tech stock and if that is why wr you go for safety, why not tesla >> so you just brought it up so they opened up a $7 billion plant outside of berlin. euro zone is buying diesel generated companies and they own their own supply chain and the cream of the crop in ev world. where else would you go to your
point. so whien -- when you look at the stock split, it does nothing for shareholder value at all yet people will march into the stock and probably buy it up another $200 from the present level. >> yeah, i think that is absolutely could happen. i wouldn't be surprised. but i have come around to the idea that once you split and you have a lower price stock, you do allow a retail -- mostly retail to be in it to trade options, where one lot of options are not prohibitively expensive as it would be on a super high stock the dividend thing i don't really understand. i don't think of them as a dividend company like google, mature but not a dividend payer. so i don't really get that when you think about two or three years ago, discussion of can they fund themselves, will they be able to issue debt which they clearly were. those converts are deeply into money so they're not in debt any
more that transformation is quite extraordinary. i think i don't understand the dividend thing you could have a small dividend just to be a technically a dividend payer so that you're allowed to be. >> included in funds. >> those that need dividend income but good for them. this is really quite an extraordinary story. tooexpensive for me. >> the options point is a good one. we had this discussion when amazon announced the stock split and tesla options are usually very actively traded and i understand it today there was monster activity >> yeah, we saw this also before other splits that is fairly typical i think it is important to remember that in those vieh high-dollar stocks sometimes you see that elevated options premium so people could get exposure to the stock for significantly less capital than it would require to buy the shares so if it will cost you $100,000
to buy a round loss of tesla, you could get into it, using often times spreads which is another way to mitigate the costs, but just going to what karen was saying, there isn't much sense to me when you have a fast growing company to trying to return to capital to shareholders in a business that is as capital intensive as this one. and the interesting thing is is that tesla's capex has been a tiny fraction of what it is for the other large legacy automakers we're talking ford, general motors and toyota and volkswagen and as they go from being a niche and the initial player of the luxury electric vehicle market to being a mainstream player, one should expect that the capital skem expendite you ares would raise to 7 or $8 billion a year. so returning capital to shareholders doesn't seem necessary or sensible.
but sometimes this will say things and throw the trial balloons out there but it is not necessarily something that will happen. >> and the master of the trial balloon thrower is certainly elon musk. but in terps of capex and the reliance of china, half of capacity, one-third of sales and berlin and texas reduced reliance on china and they've put it in the books ab come on the other side, it is interesting to why you feel the need to do it and this is a company that again is slated to make $12 a share roughly in 2022 almost $20 a share if you believe a handful of the folks in the street out there which still makes it a 50 times multiple but again a company that is growing dramatically and they are growing their sales. >> steve, you're making the fundamental case for tesla but in terms of the stock split alone, once upon a time we might
not have been sitting here saying that this could possibly be a reason to buy a stock but in this world, in the day and age we live in, is it a reason to buy the stock? >> you have right way splits -- yeah, sorry about that when you have right way splits in the stock, it always, in this day and age, it is always going to rally the stock when you have wrong way splits in the stock, reverse splits, it is always going to be the death star for the stock but when you have a stock like tesla, this is a name that is -- to karen's point, we're worried about them going out of business a handful of years ago now we're not worried about that any more we're worried what is he going to do next what trial balloon has tim said is he going to lay out there is it a battery? i remember years ago we were talking about the stock. is it a battery company, is it a car company, is it a technology company.
yes, the answer is yes so whenever you think you have a bear case to nail him down, he surprises you and that is a bad place to be if you're a bear >> let's switch gears here apple finishing in the green today. the stock is now up ten days in a row. its longest winning streak since 2010 and basking in the after glow becoming the first streaming service to win a best picture award at oscars and they've only been in the biz for years and they won with the movie "coda" and they are cutting production for the new iphone by about 20% due to weaker than expected demand. the support coming out of japan. we heard these things before, mike khouw especially from the japanese newspapers which supposedly have their ears to the ground to the supply chain that exists out in asia what do you make of this >> so a two quick things about this first of all, my biggest concern would take place if we saw
essentially concerns about or the desire to start slowing production because we saw people transitioning to a competing devices and that is not the case here other thing is when i read this, i saw that it was the iphone se, which i think is a subset and not the highest prices subset. as long as the demand essentially for apple products as percentage of the overall mobile devices market remains unchanged or continuing to grow, i don't really see why this is such a huge negative obviously there have been some pretty significant setbacks in terms of supply chain and things like that for a lot of technology providers i think of this more as a pause. i don't see this effects apple's market share at all. >> and the se being the cheaper phone. i mean, revenues could be down, karen. maybe margins would be higher. >> for a cheaper phone. >> if 20% of the cheaper phone production -- >> yeah, the nix would change.
but agree. mike's point is, to me the main one, is it a demand or supply issue. i sort of would think this is a supply issue and then we get back to is it denied or delayed, that sale would you think just delayed so i'm long the stock. it is not the cheapest thing i own by a lot but i won't trade out of it on a story like this. >> yeah. when i think about apple today also on a day where we'll talk markets with tony dwyer later on in the show, but in a day where the story was the yield curve inverted and the reason i bring up apple is because the flight to quality in big cap tech is undeniable and we just had this conversation about tesla and as a dividend, and why and et cetera, apple is a company that has so many levers to pull and even during a period where we think demand could be an issue, apple could be buying back stock and increasing dividends their capital markets and their capital structure dynamics are so different than any other company in the world that this is a reason why i think even on a day like this, if this was a
headline that could have taken apple down, i think their fiscal numbers that come out in whatever -- six weeks away are really the story that people are going to want to see on margins and where demand is for a bunch of products that i think have been pulled forward. >> i think the reaction in the stock, steve, was most surprising thing about it but it tells you a lot about how the markets treat these sorts of rumors we hear them time and time again about the suppliers getting orders to cut whatever because of demand issues or whatever it is just cut production. >> right so, i'll give you the negative i'm still long apple i intend staying long apple. today was an outside day so it made a higher high and a lower low than the previous day which means that it is -- it should in theory break trend if it breaks trend, the trend
has been up. so you don't want to see it break trend. you want to continue the process. but everyone is going to be talking about that 182.86 number that is the $3 trillion market cap level that it was add before it faded the other thing i people will start talking about is the auto recurring sales event. to make it like a subscription stock. are you going to want to do the auto subscription stock for your hardware maybe, maybe not but i think apple is getting ahead of the service head wind that potentially could be coming at them. well i shouldn't say potentially, that has been coming at them regarding the apple store for years. but that is going to be an ongoing head wind for years. would you stay long apple and look for $200 sooner rather than later. even though technically you could get a little bit of a back pedal. >> are you saying that they came out with a subscription hardware plan, steve, because they know that services are going to slow
dramatically >> no, i don't think they're going to slow, but i do think that the rhetoric is out there and i guess services are somewhere around 18% of total revenues right now maybe i'm a little bit shy maybe it more like 19% i don't think they're going to slow dramatically, but that is the potential and that is definitely the rhetoric and i think they want to stay ahead of that >> just one more thing on that subscription it makes me wonder, do they want to get into your pocket book more and paying monthly and do they want to have you, you know, apple pay, do they want to provide financing. do they have the credit card i don't know. >> they wanted into my pocket book, i'll tell you, that karen. no, but if you think about apple plus as a subscription service, you think about it and you brought up the whole dynamic of winning the best picture i just think apple as a company that has a services target on everything that you're doing and
places that -- i think the fact that the media companies are now dominated by netflix and amazon and apple is extraordinary and under-appreciated the day after the oscars. >> how should we interpret apple's win. they have been in the business for three years with apple plus. so should the other streamers be more highly valued or should we look at them as potentially the next studios, should folks like disney or comcast be worried because their studios have much stiffer competition from a likes of an apple or netflix, mike >> no, i don't think really think so this is the thing. do we sit and watch the oscars every single year and then figure out, okay, well, whichever studio won, that is the one that we're going to go and chase the stock now. i don't really think that is the way that investors think about things i mean, if you have a big blockbuster, that is another story.
we do see people and we often see the reddit crowd clas that a little bit but at the end of the day we're more interested in profit margins and revenues and ticket sales than i think we are the number of shiny trophies although, if you're in karen's family, maybe that is the thing that you're paying a lot of attention to as well because you seem to be accumulating them. >> two shiny trophies in your family. >> congratulations >> very cool i had nothing at all to do with any of it. sadly. but one more thing the movies, the ten nominations were a lot of small movies and then they had the five highlights, people's favorite and they are were avengers and marvel that and blow up that and that is where the movies are -- >> netflix had 27 nominations and it is extraordinary and they are called the pipes and a conduit. >> and now on owner of netflix. >> and an owner of disney and
apple and amazon shares sox i like my exposure to old school and new school media but i do think that it is about content. i do think that an argument, and i love disney content and i think the studio is unrivaled in rolling things out that are the flywheel and to see the best picture is a seminole moment for hollywood, i think it is and it is important in terms driving talent they could have overpaid but now this is a studio that has to bebe e respected. >> tony dwyer will help us navigate the markets and the risks wall street is oestimated. and the feds get close to zero and regionals are getting the worst. the details are next don't go anywhere. don't go anywhere. "fast money" is back in two. leaving you lost. you need to hire. i need indeed.
when it comes to cybersecurity, hing your job description. the biggest threats don't always strike the biggest targets. so help safeguard your small business with comcast business securityedge™. it's advanced security that continuously scans for threats and helps protect every connected device. on the largest, fastest, reliable network with speeds up to 10 gigs to the most small businesses. so you can be ready for what's next.
get started with internet and voice for $64.99 a month. and ask how to add securityedge™. or, ask how to get up to an $800 prepaid card. welcome back to "fast money. bank stocks taking a hit with the regional bank index dropping more than a percent. the move coming as a spread between 30 and five year trends close negative for the first time since 2006.
morgan stanley downgrading it today. and you made the point it is not about the spread, but that is how banks trade. >> it is does not matter what it is a giant book of twos versus tens the first ones out of the gate, when we announced quarterly earnings is that the bar will be low. when you think about this year, this time last year, spacs were on fire. capital markets was going crazy. and you had a much steeper curve. so, this is going to be not so easy for them. that doesn't mean that they can't make money they can but, the bar, i think will be lower. normally it has been high in the last five quarters and no matter what they put out, the street was disiappointed. i'm still long the bank stocks we haven't seen a credit contagion, and maybe we will, who knows.
>> i think banks trade as if they are waiting for something and pardon the metaphor, so things to float to the surface so i think -- i don't mean -- >> so no -- >> save me from myself but thepoint is that you have a -- rubber ducky and had a massive move in yields the type of a move and we talk about velocity of moves all of the time and many folks that are playing in the fixed income markets but specifically treasury markets are highly levered in the sense that no one is escaping from this again, think about the moves that we've had banks were, excuse me bonds were down in the first quarter. now they've never had a quarter where they've lost 6.5% to start the year ever so this is a case where i do think that banks are exposed to some of this risk. do you think that the yield curve, what karen said, is everything is tethered to the 10-year and the five is concerning, people are waiting for two tens toin vert. >> it doesn't seem to make sense
if we've seen such volatility in various asset classes and not see any blowup or impact on banks even if it is their clients and their counterparties. >> right it doesn't make sense. but i think it was so telegraphed when we heard the chairman powell talk about being aggressive, to fight inflation so all of these bank charts, all of them technically are a mess bank of america and wells fargo are actually look like they're trying to fight back a little bit of an uphill battle lehere but think about what the fed is trying to do and we'll talk to tony dwyer about this but the fed is trying to slow down the economy that is not great for banks. so that is not great for loan growth now with everything going on geopolitically, do you want to start a business or take out a loan right now or you're probably going to wait and see the banks are feeling that pressure and they'refeeling a
possible recession out on the horizon. so that is what i'm seeing in the technicals we'll ask tony what he thinks about a recession possibility. >> yeah. there is all of this volatility and then also a concern possibly about the consumer and what they're willing to spend and if they're actually starting to, you know, whittle away the big savings lump sum that they accumulated over the pandemic because their grappling with higher costs left and right. >> even if they did whittle away at the accumulated savings that people got during the pandemic i mean, we haven't really gotten back to trend though yet, have we and that is part of the issue. and that speaks to still potentially some buying power from consumers the thing that obviously i think for a lot of us that have been in the markets for a while, i'm looking at the ten-year and i'm thinking, okay, when it is going above 3% 3% would be sort of a concrete
violation of the 30 plus year bull market, 40 plus year bull market that we've seen in bonds. i say 30 because that is how long i've been in the business but it predated my arrival that is really the reversal in a long-term trend that i think a lot of us are wondering how that shakes out and the suspicion is probably not very well because when you have a big book of financial assets, especially things like credit assets, fixed income assets, they don't benefit in your long duration for increases in the ten-year rate and that is the sensitivity that tim was talking about where we're kind of waiting to see what implications are. somebody has exposure to that and it is going to be ugly when we see it. >> really quick, the 30 year mortgage has ramifications for a lot of different parts of the economy. so i hear you. it is 40 years and twos and tens and they haven't broken it yet, but i think they will. >> here is what is coming up
next >> crude, crushed. oil slipping as demand fears spark up so is the economy headed for a slowdown the details next. plus, grab your popcorn. amc curious deals could continue but the ceo said on the theater's big plans. you're watching "fast money. live from the nasdaq market site in times square. in times square. we're back right after this. toy cyberattacks slow you down. so you partner with ibm to build a security architecture to keep your data, network, and applications protected. now you can tackle threats so they don't bring you to a grinding halt. and everyone's going places, including you. let's create cybersecurity that keeps your business on track. ibm. let's create ♪♪
economic slowdown could be coming let's bring in tony dwyer, it is great to see you it's been a while. the marks are like scaredy cats. >> well i think the biggest fear is that it is overestimated is the 210 flattening or the five-year to 30 year and i understand why we use that, it is very useful at times but the most important thing we could talk about is why do we use the yield curve. because it mentioned the difference between where i banker lends at, what they have to pay, versus what they charge or invested at that spread is how much money they are make. so the real thrust of the banks or lending institutions liquidity is come from deposits. so since february of 2020, there has been actually $4.75 trillion -- trillion dollars put into commercial bank
deposits so we're using the three-month and five-year, and the average inflation is about 6.5 years so we're measuring what the banks are getting the money at, the deposit rate, versus what they are lending it or investing it at and that is steepened. so the fear is definitely there. asia seems to be a mess with more lockdowns and europe is heading for a recession because of the once in a generation ground war there and the u.s. is being effected by higher rates it is certainly slowing down but we don't look for a recession because the yield curve is still very positive. >> thanks for coming in. it is karen. how do you think the yield curve will change depending on the fed. if we see 50, say, the next two meetings is it already priced in, what do you think? >> at this point everybody is talking about so many rate hikes. when we look back, at the only
time that there has been this divergence that i could find, this kind of divergence in a 210 yield curve, versus the three month, 5-year yield curve was 1994 when alan greenspan was so fearful of inflation that they hiked rates seven times in a row and two of them were 50 basis points and then a 75 they doubled rates the market acted similarly in that you had a 10% crunch in the beginning of the year, a lot of choppiness around the end of the first quarter. rallied into august. almost to a new high and then that slower economic back drop hit it again toward december so it retested the low and then you didn't look back for four years. so i think we're in this environment and we call it tumultuous there is no question rates are going higher the foed fed is in a box they have to raise rates, no matter the slowdown. >> so tony, it is steve. good to be with you. when you look at this, i
remember you saying that whatever de jour rate inversion that you're looking at, it only signaled the recession 18 to 24 months later and the market usually moved up about 15% between then and the actual recession. recessions are normal, healthy and natural. your words when you look at what chairman powell is doing right now, do you think he is just being extremely hawkish with his rhetoric and where in the balance sheet reductions is going to be another rate hike so that he's front loading so the market could catch up and the back end of this, he's going to come out and be a lot more dovish than his rhetoric would assume >> well, i think that is going to ultimately be the case, steve. because the fed is in a box. they have two mandates inflation and employment there is no world in the next couple of months where they get better in terps of inflation so the fed is looking at this
data, remember, the data and the fed could change quickly remember five months ago, not five years ago, five months ago the fed said there will be a long lag between when they stop adding to the balance sheet and when they do the initial rate hike well unless that means five minutes, that changed. so five months from now it is hard to say that you're scenario, steve, doesn't play itself out for now, the fed has to sound hawkish and control inflation expectations what i find interesting is going back to mel's comments and what you were talking about earlier, the market seemed to be almost pricing in a recession trade because the areas that should do the best with higher rates have been lagging and the areas that are doing -- that should do the worst, the faang stocks, the mega cap valuation names, they're doing better
it is interesting, if you look at the new york faang index, the 10-day rate of change has never been higher on the faang index outperforming the s&p 500. that is in a higher rate environment. that tells me that the market is beginning to go back to karen's point, it is beginning to potentially price in some form of a recession that is what happens in this kind of transition of monetary policy and economic activity. >> tony, great to see you. thanks >> thanks, mel >> tony dwyer, can accord. mike, is that the message of the markets, in your view? >> you should be looking for is the ideosyncratic growth the tech names have represented that i don't know about names like netflix necessarily. which is part of faang the g in there is definitely appealing to me. alphabet, i don't see any reason why people aren't piling into that i mean, i think that is still down as i looked at today's
close, i think it is off maybe 150 basis points on the year and amazon just ticked into the green. but to me, of those two, i would much favor being in alphabet if you're thinking to yourself, what do i want to be in, add a market multiple, how about solid and ideosyncratic growth and that is what it represents. >> i agreement and i own google and prices to erjss growth is the same price as google it is particularly cheap and i also think that we're now back to down 5% off the all-time highs in the middle of an aggressive fed hike. and i think markets have climbed that wallboard i think a lot is going on. we all know where sentiment was three weeks ago and we've now moved 12% higher on nasdaq stock. so the question is we always get a multiple correction in a tigh tightening cycle typically two turns or more. we have gotten that as where we
were a few weeks ago and there is a chart out there, but goldman had a report talking about buyback activity and again in an environment where you have less opportunity for growth and companies that are actually concerned about the volatility of the environment, they're buying back, goldman sachs said they're going to buy back billion dollars in stock this year which would be an all-time record. >> coming up, mining and maybe more adam aaron digs into the theater chain future plans and what he said is next for the company plus crypto cruising higher. bitcoin nearing the $50,000 mark gray scale ceo michael sonnen shine will join us plenty of more "fast money" coming up. >> catch us any time, anywhere follow today on your favorite podcasting app we're back right after this.
it wouldn't be there with us with his own money and the money that we put in we just raised another $139 million in trading days we are going to leave the run of the almighty company to the experts. we're experts in balance sheets. >> that was amc ceo adam aaron today on cnbc talking about the movie theater chain in high croft mining, shares up 45% today alone. after aaron suggested more quote/unquote transformational deals might be coming. i like at the end, they are an expert in balance sheets, apparently they are. karen. we are seeing a 12.5% pop in shares of high croft in the after-hours session because we understand it is a small stock but it is important to note that action within this story karen. >> i just find this so amazing i mean, i have no position i have no position in amc. just the idea that they would
use their pile of cash, which he keeps to refer to $1.8 billion seemingly ignoring the far more huge pile of debt, is kind of astounding to me and looking through some of the filings today, reading more closely, they were actually using some of the money to pay off high croft debt. which i find staggering that amc, with so much debt, they are a junk rated issuer. >> so they pay a lot of in interest. >> yes would pay off someone else's debt that is staggering to me maybe the money isn't directly going to pay it off but money raised through this offering is used to pay off debt that is astounding to me and with him and sprout's investment, we wouldn't have the atm market issuance of shares. and i keep coming back to board when he prebed presented this
idea, sitting around saying yes this is the direction we should take. >> a goldminer >> nothing said buy a goldminer like a giant indebted balance sheet. >> another transformational deal eric sprot is the real deal. i want to be clear i've been invested in commodities for a long time so if he saw something in high croft, not a company i've done a lot of work on a small goldmining company that has had some balance sheet issues i have to give him the benefit of the doubt how amc gets involved, give them the benefit of the doubt too because i do think that there is -- an opportunity to coinvest this doesn't change the debt laidet status of the company, doesn't change the core business -- >> okay. we're look at this from a fundamental standpoint but this is a stock that jumps on the retail bandwagon and bringing the retail magic to hymc and here we have it
it is was 81% today in session not including the after-hours session, mike. this is separate, right. this should not be judged by normal fundamental standards, should it. >> there is a little bit of a fundamental element here that normally we didn't anticipate that when you probably took any courses on finance which is a huge, huge disconnect between the cost of equity capital and the cost of debt capital. and right now whatever they make this kind of a statement, essentially, i mean, take a look at what is happening if they could continue to do additional secondaries and raise capital this way, then this is probably a decent strategy you're basically playing off the enthusiasm for a story, to elevate your stock price, you could raise some capital that way. and then go about paying down that debt. which would make sense under any other circumstance, but because of this weird sort of arbitrage going on, it makes it a little bit of sense for them to say, for example,
and i know they did talk about this earlier today he was talking to jim cramer about it should we be trying to take this as an opportunity, to take this money and expand on our existing business a business that wasn't making money before all of this before the pandemic. the answer to that is no take a little bit of money tell it into something sexy and get people to jump and i think that is what is going on a little bit of capital structure ashity rauj. >> for the record. mike khouw saying this this makes a little bit of sense. i think it is an important day. >> this is the retail presence the apes you have to respect them if that is what they're going to do, i would not get in the way i find it kind of crazy. but retail is very different than it used to be. >> coming up, bitcoin boom today's jump bringing the crypto positive for the year. can the run continue michael sonnenshein will join us next to break down the moves
power e*trade gives you an award-winning mobile app with powerful, easy-to-use tools, and interactive charts to give you an edge, 24/7 support when you need it the most. plus, zero-dollar commissions for online u.s. listed stocks. [ding] get e*trade and start trading today. never settle with power e*trade. it has powerful, easy-to-use tools to help you find opportunities, 24/7 support when you need answers, plus some of the lowest options in futures contracts prices around. [ding] get e*trade and start trading today.
positive for the year. so is this rally here to last. let's bring in gray scale michael sonnenshein. great to have you with us. >> great to be here. >> i actually want to start off with gbtc which is trading at about a 20% discount to its net asset value. you have said in other interviews that if the s.e.c. rejects your plan to convert to an etf, that you would explore all options. what does that include >> well, i think really, melissa, this is about continuing to work proactively with the s.e.c gray scale's history around gbtc goes back to 2016. and so working together to develop the guidelines for becoming an s.e.c. reporting company, and now pushing those boundaries to have the s.e.c. even out the playing field for us to have gbtc become a etf and we'll continue to put the full
sources of gray skral behind the initiative but we're calling on investors to partake in this process as well. >> what is the reason why the s.e.c. is hesitant about this and what are your counter arguments? >> well, the s.e.c. has cited time and again concerns over the underlying bitcoin market. the potential for fraud and manipulation or a lack of surveillance in the underlying bitcoin market now what we find ourselves is a world in which there are bitcoin futures etfs, but still a rejection of the underlying bitcoin spot etfs. like gbtc's application. while it is a very, very important milestone for us to have bitcoin futures etfs here in the u.s., the futures contract itself does not solve any of the underlying concerns that the s.e.c. may have about bitcoin. and thus we really think the s.e.c. should do the right thing, protect investors and allow both of these product types in the market. >> so, when you say all options, is that include a lawsuit? what is the recourse for a
company like yours if the s.e.c. does eventually reject, i don't want to say eventually, should they eventually reject the bid. >> there are certainly options to get into a -- into legal arguments around this. one of the most prevalent comment letters submitted now are around the gbtc conversion is a potential for a violation where a regulator is not looking at two like issues through the exact same lens. so come july, all options are on the table. but between now and that time, it is really important that all holders participate in this process. >> so what is a marketing sort of aspect of this all, your gbtc product versus the current products on the market, the futures etfs, the futures products is it that if you buy gbtc here you're getting a discount to bitcoin and that eventually that
premium will close and you get a 20% shot higher. or i mean, this is not the product that most closely tracks bitcoin. >> well, there are certain differences between the futures products and the potential for a spot etf right. you have roll costs and other elements of the futures products that do erode away at the ability to effectively track bitcoin. certainly today investors have the opportunity to buy bitcoin in the spot market or buy through gbtc at 80 cents on the dollar and one would expect that to converge with net asset value if it is approved to be an etf but importantly, today, melissa, there are over 800,000 accounts in the u.s. that own gbtc today, retirement accounts and etfs, and mutual funds across all 50 states so we want to encourage investor participation and understand they have an important role to play here as the s.e.c. weighs this important decision >> michael, great to see you
thanks for your time >> thank you michael sonnenshein of gray scale. we spent time on this because there is some issue. if you own gbtc, there is a cohort of people who own this thinking that that -- that gap will close exactly. you'll get a 20% pop theoretically if the s.e.c. approves an etf. and we're waiting here. >> i'll be shocked if they don't approve the etf at some point and i think it is fantastic for the asset class, obviously i think regulation is not the issue. michael just said it they welcome working with the s.e.c. the decentralized nature does not mean it should be run rough shod and i also always say, i also want my treasury to know where -- and keep track of the currency and the exchanges between the dollar so ultimately, i will point out that bitcoin is up about 35% since russia invaded ukraine and i think there is some
correlation between central banks and other players around the world saying they don't agree with russia but the fact that the u.s. can freeze russian assets, that the europeans can freeze assets, i think that bothers the chinese and a lot of other people and i do think it is dollar negative and i do think it is bitcoin positive. >> and the other factors that are dollar negative, central banks wanted to move away from the u.s. dollar as a reserve currency grasso, all of this bullish for bitcoin here as we sit at these key levels. >> yeah, i think it is all bullish for all crypto i actually own the gray scale ethereum trust and that is up aggressively as well pretty recently but i think the takeaway that michael had just said and tim touched on, the regulators seem to be warming to this idea that is no longer this thing out in the stratosphere this is happening and we're gaining market share and it is bullish. >> coming up, lulu on deck to
report earnings tomorrow we're see if shares are ready to rebound. rebound. more "fast money" after. new investors can open an account and get $101 to split across the top five stocks in the s&p 500®. you can also unlock short videos, step-by-step guides, and other easy-to-use tools designed for people just getting started. plus, investment professionals are on standby 24/7 if you ever have a question. it's investing 101, reimagined.
. welcome back to "fast money. lululemon earnings on deck down about 15% on the year but they are feeling bullish ahead of tomorrow. mike khouw has the action. >> we saw three times the daily average options. bullish bets out pacing bashish by two to one. the 330 strike calls were trading for about 11.5 bucks and it is implying a move of 7.5% higher or lower by the end of the week but the buyers ever these calls are betting that move is going to be to the upside. >> be sure to tune into the full show on friday at 5:30 eastern time time up next, final trades. ♪
♪ ♪ ♪ hey businesses! you all deserve something epic! so we're giving every business, our best deals on every iphone - including the iphone 13 pro with 5g. that's the one with the amazing camera? yep! every business deserves it... like one's that re-opened! hi, we have an appointment. and every new business that just opened! like aromatherapy rugs! i'll take one in blue please! it's not complicated. at&t is giving new and existing business customers our best deals on every iphone. ♪ ♪
a lot of drilling going on stay in it trade. >> and karen. >> i like kohl's, i think there is a process underway and which if there is a deal, the stock will go up from here. >> thank you for watching "fast money. we'll seek you back here tomorrow for "fast." don't go see you back here at 5:00 for more "fast." meantime, do not go anywhere "mad money" with jim cramer starts right now my mission is simple, to make you money i'm here to level the playing field for all investors. there is always a bull market somewhere, and i promise to help you find it. "mad money" starts now hey, i'm cramer. welcome to "mad money. welcome to cramerica other people make friends. i'm just trying to make you some money. my job is note just to entertain you, but to educate you, put it in context call me at 1-800-743-cnbc, tweet me @jimcramer. now i