CNBCfix - Fast Money Review

[CNBCfix Fast Money Review Archive, July 2011]
[Sunday, July 31, 2011]

Did Roger McNamee use The Strategy Session to front-run a negative article on Forbes?

Just near the end of his appearance on Wednesday's Strategy Session, Roger McNamee brought up a subject he wasn't even asked about.

Forbes.

Curiously enough, so did Fortune mag — the next morning.

And when one puts 2 and 2 together, one might infer McNamee was launching a preemptive strike about a key paragraph in the Fortune article.

On Wednesday's Strategy, McNamee said, "We're an investor in Forbes. HTML5 is gonna swing the pendulum from commoditization back towards differentiation and content."

David Faber asked, "You still happy with that investment? I know that was made a number of years ago; Forbes has had not an easy go of it."

"No they haven't," McNamee said, "and we've marked it way, way down. But from where we hold it, it's gonna make us I think a terrific return. Remember, the investment business isn't about the money you lost yesterday, it's what can you make tomorrow."

"And what gives you the confidence that that's a position that can turn around for you?" Faber asked.

"Because I look at what the technology's allowing. And I look at what my band, Moonalice, has done," McNamee said, not really answering the question.

"But at the end of the day, though, that's a content business and it really is all about how- what content you're delivering not necessarily how you're delivering it," Faber persisted.

"I actually think the 'how' is gonna matter enormously," McNamee asserted. "Because now that people just want things on their body; the reason Google is having a problem is that people do 1% as many index searches, Google searches, on a phone as they do on a computer."

We'll get back to that stuff in a moment.

The Fortune article, meanwhile, which according to Fortune was posted 5 a.m. Thursday, outlines how the Forbes Media empire, which sold a 45% stake to McNamee's Elevation Partners in 2006 for $237 million, required an "emergency" restructuring of loan terms with JPMorgan and 6 other lenders in August 2010. The article also revealed previously unreleased documents showing fairy tale-like projections of revenue and profitability through 2011 that apparently were accepted by both McNamee's team and the lenders.

But for The Strategy Session, this was most likely the most important passage in the article, curiously set off in parentheses: "(In a twist that could prove lucky for Forbes, it has a 'call' option to force Elevation to sell back its stake at fair market value anytime after Aug. 4, 2011. If the company's value does not rise above what Elevation paid in 2006, Forbes could buy back the stake and stick Elevation with a loss.)"

McNamee clearly has an endgame here.

And the question would be, based on his comments, does he want Forbes Media to buy out the Elevation stake, or does he not want it to buy out the stake?

Certainly, he argued that the brand will make a "terrific return" going forward, which would be an incentive for Forbes Media to buy out Elevation.

On the other hand, he claims it's HTML5 that will deliver this "terrific return," which would figure to be an incentive for old media types to maintain their partnership with a Silicon Valley firm.

In fact, either side, just a few days from now, can require Forbes Media to buy back the stake. The article notes, before the parentheses, that Elevation has its own "put" option of requiring Forbes Media to repurchase the stake at "fair market value." We're not expert financiers here by any means, but as far as we know, "fair market value" — as defined by Investopedia, formerly a Forbes Media property — means the price an asset "would fetch in the marketplace," or in other words in this case, the same price Elevation would figure to get from any other buyer.

The fact Elevation requires this "put" suggests, as the Fortune writer notes, it was "clearly worried about being able to exit the deal," and so we would add that "fair" really means "above" in this case.

The gut here is that "fair value" is a dog, this one's a loser, and Elevation doesn't want to get stuck with a hefty loss on Aug. 4 but prefers more time to either turn the business around or amortize it, so on Wednesday, McNamee tried to argue that Forbes Media is more valuable than it actually is, which would figure to dissuade the Forbes Media brass from deciding, "We might as well buy it back now; it's dirt cheap."

In any case, there's an agenda going on here. To think that the subject of Forbes came up on Wednesday's Strategy Session as some innocuous non-sequitur from McNamee, after David Faber had said, "I'm happy when our guest dictates where we're going," is to think that the guys and ladies in Washington, D.C., want to take a serious stab at entitlements and tax brackets this weekend.

The article doesn't quite get far enough to even imply why Forbes Media would want to buy the stake back. It can be inferred that after the restructuring of August 2010, the company is indeed on sounder footing, and if family members decided "this is the bottom" and/or like Hef simply wanted complete control again, now would be as good a time as any to buy out Elevation, probably with more borrowed money.

It's a classic have-their-cake-(what's-left-of-it)-and-eat-it-too story such as the New York Mets are trying where old money gives little more than a token nameplate to nouveau riche who are eager to help them out with borrowed money, knowing this might be as close as they get to a signature brand, and the result is largely banks handing out big sums so that founding family members get paid.

The Fortune article, by Katie Benner, is well-written, but includes no indication that Elevation was ever asked for comment.

[Friday, July 29, 2011]

Jane Wells unable to decide if defense-billing report merited chuckles

Jane Wells' reports often are laced with a wry, self-deprecating sense of humor.

Friday on the Fast Money Halftime Report, Wells was just a bit reluctant to quite go that far and ended up stopping short like an NFL DB who avoids hitting a receiver, perhaps out of surprise that Judge Wapner was taking everything so seriously, but then again, maybe funding the military isn't supposed to be an amusing subject.

Wapner asked Wells what will happen to defense-contracting payments, although he clumsily didn't specify whether he was speaking of a default scenario or downgrade scenario, or both.

"Hey Scott, here's what's gonna happen: Nobody knows," Wells said.

Jane said that according to the Pentagon, "Treasury takes the lead" in determining who gets paid first. Wells went on to float a stock pick via a clip from Howard Rubel: "He likes Raytheon, which is selling a lot of stuff overseas."

"All right Jane, thank you," said Wapner, abruptly.

"Um hm," Jane said, evidently disappointed at the lack of a kicker.

Stephen Weiss: ‘You’re not going to have the economy improve while he’s in office’

Stephen Weiss on Friday's Fast Money Halftime Report made the type of long-term forecast that may be right or wrong, but is bound to resurface on this page at some point.

Weiss argued with Steve Grasso over whether (purported) austerity would actually goose the economy.

"You're 2-6 years, depending upon how long Obama stays in office, from companies really hiring," Weiss said.

Grasso argued that the uncertainty plaguing business is whether the Obama administration will actually take on the entitlement-debt problem and thus austerity would be a plus for the certainty side of the equation.

Weiss shrugged and insisted, "2 to 6 years I say ... you're not going to have the economy improve while he's in office."

"I think we've seen the recovery. I think the recovery's over," Weiss also said.

The conversation was started by Judge Scott Wapner's report that Citigroup projected austerity measures would lop 2/10th of 1% off GDP, to 0.7%.

(So isn't this where CNBC should be celebrating the Peter Boockvar/Steve Cortes point that fiscal/monetary policy merely helps the wealthy asset owners who are in the markets?)

Patty Edwards said Citi's way too low. "You know, I think that they're probably underestimating it because there's gonna be a ripple effect from this," Edwards said, predicting a trickle-down from U.S. government to municipalities that depend on payments and even entities such as the University of Washington, whose new president, 61, is married to a 38-year-old pursuing her bachelor's, which doesn't sound very austere to us. (That really has nothing to do with anything, but it's interesting.)

"2/10th of a percent, that's nothing, it's gonna be more," Edwards asserted.

Grasso said, "I'll take the other side of that, for the main reason of, maybe we start moving some of these government workers onto the private payrolls because now once austerity measures start happening, maybe companies start hiring more because less unknown."

As we all wait for the austerity, like the castaways waited to get off the island ...

Rebecca Patterson does not mention bikini in Fast Money Halftime appearance

Rebecca Patterson, who lit up last week's Money in Motion with her bikini comment during a "gold gone wild" conversation (see below), spoke on Friday's Halftime Report and was not nearly so entertaining this time.

"Even if we get a deal, I think a dollar bounce is short-lived," Patterson said. "I'm looking at euro-Swiss today ... you go short the euro, you go long the Swiss franc."

Patterson also did not revisit the bikini-gold subject on Money in Motion but did sport a lovely scarf.

We can’t let education go without strengthening our commitment, we don’t want to leave our senior citizens caught in the middle, we need to help people facing foreclosure, we’ll have to ‘invest’ in our ‘crumbling bridges’ infrastructure ...

Obviously every government policy shop has to be making debt predictions at this time, and Edward Mills' offering on Friday's Fast Money Halftime Report was that there's "about a 40% chance now that we get to Tuesday and no deal is done."

"I think we wake up on Monday morning with no deal done yet," he added.

Mills said he's not a stock-picker but that investors are probably right to stay on the sidelines. The ultimate package, he said, will be a "hybrid of a lot of what's being discussed here," and what he should've said was a hybrid of everything except "austerity," as there will be plenty of goodies to go around for every constituency by the time this is settled, the fiercest debt critics will write NYPost, MarketWatch and Forbes columns for a couple more days about how we're kicking the can down the road, and then we'll all go back to talking about QE3.

At least one useful thread occurred as to whether MLPs are a solid buy in the wake of the debt talks. Mills said there will be "headline risk" for the sector while Congress debates changes to the tax structure as part of long-term deficit alterations.

Dr. J: Don’t buy stocks
on ‘piddly sell-offs’

In terms of actual stock-buying, Friday's Fast Money Halftime Report veered between Steve Grasso and Patty Edwards telling people to sit tight, and Dr. J ranting at least a couple times about how this isn't a big enough dip to buy yet, sounding almost like a subtle rationalization that maybe Doc missed some kind of run-up this week.

"I'm a buyer on big fear in the market. I'm not a buyer on little dips," Najarian said. "You don't buy 'em on little piddly sell-offs like some of these stocks we're talking about have had."

"Right now, I don't want to do anything," Edwards said, "but I've got a list ready."

"Just have your powder dry," said Grasso, who said there are names you can still buy on dips.

For whatever reason, Patty was fixated on Saks. "Starbucks, a $4 cup of coffee, no one in the high end is going to give that up. Going to Saks and doing a huge wardrobe redo, that might have more of an issue," Edwards said. "Saks, you're really, you've got 25% of the sales coming out of that flagship store in New York, and if the euro is having issues, you're not gonna get that, that tourist in, that's gonna be more of an issue."

She halfheartedly recommended SBUX and JWN.

Najarian told viewers about a trade that was already light-years old in terms of practicality, saying that Annaly and American Capital plunged on downgrades at the open, but then savvy options buyers cashed in; "those calls exploded as both those stocks recovered."

Steve Grasso suggested gold could take a 5-7% drop if there's a government deal, but assuming that deal doesn't involve entitlement reform, "longer-term, gold probably makes its way to $2,000."

"When was the last time we spoke about Iran?" Grasso wondered.

(Probably about the last time we spoke about swine flu.)

Steve Grasso rekindled our favorite all-time Fast Money cliche, "You don't have to be a hero," but said that those who want to be should go see "Captain America." Patty Edwards agreed; "I'm with him, go to the movies this weekend or watch theater of the absurd on TV." (Just don't see "Midnight in Paris" or "Horrible Bosses.")

Stephen Weiss revealed, "It's been 20 years since my wife had a budget."

David Faber’s vacation is actually contingent on D.C. debt talks

The most interesting comment by far on Friday's Strategy Session came at the very end, from David Faber.

"I'm not gonna be here next week, although, if they don't get this stuff together in Washington, I may be," Faber said.

‘Downgrade actually coincides typically with the start of a rally’

During a week in which finding any useful investing advice on CNBC has been a serious challenge, Thomas Lee offered this head-scratcher on Friday's Strategy Session.

"The event of the downgrade is (sic) actually coincides typically with the start of a rally," Lee claimed.

"What did you look at to determine that," asked skeptical David Faber, saying it hasn't happened.

Lee said there have been "79 separate ratings actions against sovereigns" including "12 AAA-rated countries," and impressively rattled off Japan, Sweden, and a few others, but whether that's relevant to U.S. 2011 is up to you.

Lee also said that when government spending falls, GDP generally remains unaffected while markets tend to rise, "they gain about 11% a year." He said it's evidence that "governments generally aren't good allocators of capital."

Lee told David Faber, "We don't expect a default of the U.S. obligations," and said the economy could use a jolt of homebuilding. "Every time when we build 250,000 homes in America, that's a million jobs," he said.

Guest Tad Rivelle was interrupted by an incredibly dull press conference featuring Harry Reid (David Faber justified it as, "in this market we have to obviously listen to every utterance more or less, from our nation's, uh, political leaders, be that as they may"), but then was inexplicably given way too much time to make way too long statements.

Rivelle did say something of note, that he likes the "non-agency mortgage market ... the implied rates of return on capital in those marketplace (sic) is very attractive."

He said the plans floated in D.C. suggest "less Keynesian stimulus in the economy," and that, "one should, uh, take the August 2nd date I think with a little bit of a grain of, of salt."

David Faber cut in there and said "At the end of the day," but Gary Kaminsky had the day off again and wasn't around to punish Faber for it as Faber requested a day ago.

Guest host Charles Kantor said the equity markets have been "held hostage to Washington this week."

[Thursday, July 28, 2011]

Forbes blogger: Fast Money Halftime analysis of Brazil ‘was a little weak’

On Thursday's Fast Money Halftime Report, Judge Scott Wapner and Steve Cortes trumpeted Brazil's entry into bear-market territory.

But according to Forbes BRIC blogger Kenneth Rapoza, "Their analysis, however, was a little weak. Granted, that could be that they only had about 50 seconds to state their case, but their case didn’t explain the main reasons behind the decline in Brazil, and emerging market equities year-to-date."

Thankfully, Fast Money on
Thursday included commercials

Occasionally, the advertisements — even the wretched one for Magic Jack — are the Fast Money viewer's best friend.

Show producers on Thursday avoided the mistake of uninterrupted coverage like they delivered during the Greece no-confidence vote, offering 15-17 minutes of alternative programming amid what frankly was an unwatchable hour of television.

Here's hoping no one else in the world felt compelled to watch the entire show.

Think or Swim never came across so refreshingly.

Eventually, someone on Fast Money did get to an actual trade — it was Mike Khouw, selling the November 85 call in TIF — but at the 50-minute mark, it was too late.

At least on Friday, there's the possibility that Rebecca Patterson will revisit the bikini-showering-in-gold conversation on Money in Motion.

"These press conferences — we need some silence out of D.C. These press conferences have got people right now scared," said Joe Terranova.

Or more likely, "bored."

Much fertile ground to be explored with this one

We were tempted to just take a pass from identifying anything from Thursday's Fast Money, but then underrated pundit Ron Insana, who was given far less time than he should've received, said something mildly interesting.

Insana said he sort of agreed with Guy Adami's half-hearted assessment that markets could be slumping not over the debt negotiations, but more businesslike reasons, such as Emerson's negative outlook.

Insana agreed to an extent and said there's actually a name for this: "False-cause fallacy."

We did some Google searches and discovered it is a legit term, although the Wikipedia page uses slightly different phrasing.

We're surprised it isn't heard more often, given that the government indulges in it all the time, you know, things like, "successful people tend to be homeowners," so the more people we get to buy homes, the more wealthy people get.

More alarming evidence that the Dow really does run the country

Not only was Ron Insana floating catchy philosophical terms on Thursday's Fast Money, he was drawing curious historical parallels to the stock market.

Insana bemoaned congressional bickering, claiming, "We're getting dangerously close to a TARP II-style moment" similar to when the Dow crashed 777 points in September 2008, a moment Insana called a "total abdication of responsibility" by Congress.

"They blew it on the TARP vote," Insana added.

But did they?

That TARP vote occurred Sept. 29, 2008, a day the Dow fell 777 points.

A day later, the Dow regained 485.

3 days later, the Dow back down around its Sept. 29 level, TARP passed and was signed by George Bush.

No big banks or automakers that we're aware of failed in those 4 days.

So the people who really "blew it" were the yo-yos who sold at the bottom of that 777-point selloff and missed the 485-point recovery the next day.

What's more, a mere 3 weeks later, the Dow was actually down another 2,000 points (that's correct, 2000) from the post-TARP-vote level.

So if anything, the first House TARP vote did a lot of nervous people a massive favor by chasing them out of the market before things really disintegrated.

Insana is hardly alone in this dubious sentiment. Dylan Ratigan spent that week denouncing Congress for taking 777 points off the Dow, because even business channel free-marketers think that people should vote whatever is best for the Dow Jones Industrial Average rather than what they actually believe in.

What else is on
at 5 p.m. Eastern?

We said Thursday's Fast Money was wretched, and it was, but it sounded like the Bobby McFerrin conclusion could be drawn.

"If people were really afraid right now, you would see the sort of volume turnover in options, stocks and futures that we saw in '08," said Jon Najarian.

"Whenever Chuck Schumer tells me to be afraid, I'd like to be buying the market," said Steve Grasso, who a couple times asserted this is nothing more than "theatrics."

Grasso asked Ed Groshans if the market's a buying opportunity if it happens to sell off over these congressional votes (or lack thereof). "I would say, I would wait," said Groshans, hesitantly, explaining it will take "3 days" to wrap up a deal.

David Greenberg said in a real financial crisis you'd probably see oil and gold moving sharply, but that's not happening, and "I don't really think that you're gonna see a major move in either one," just before a notable dead-air pause.

George Goncalves said he doubts we're going to get a "road map" for our structural debt problems.

Dennis Gartman said, "I would be opposed to a balanced-budget amendment."

Guy Adami said, in one of the few ventures toward an actual trade, "I would be a little bit careful with Starbucks around this 41."

Melissa Lee's interview with an almost stricken-looking Matt Fabian over munis was so clumsy, it was luckily ended with breaking news on John Boehner's House vote before it got too much out of hand.

Lee called the movie "Face Off" a "little gruesome."

Jon Najarian said the Patriots landing Chad Ochocinco is "good news for them," and we'll take the other side of that trade and call this an act of desperation that will likely end in a cut.

Melissa Lee asked Ron Insana if the D.C. press conferences are moving the markets.

"I have absolutely no idea," Insana said.

Joe Terranova:
Out of soundbites

It's the obligation of this page to chide anyone on CNBC heard saying "kick the can down the road," and on Thursday's Fast Money, it was Joe Terranova who found the cliche well running dry, telling Ed Groshans, "It basically sounds like we're kicking the can down the road in essence."

Scott Wapner is too immersed in the ridiculous political news of the day

On Thurday's Fast Money Halftime Report, Scott Judge Wapner actually said, "There's gonna be major austerity coming out of the government."

Judge Wapner forces Guy Adami to get to the truth on CSCO

Judge Wapner impressively ordered Guy Adami to make a CSCO call on Thursday's Halftime.

Goldman Sachs calls it a buy, Wapner said, so "is it?"

"Maybe," Adami started to say.

"This isn't a maybe show. This is a yes or no," Judge demanded.

"Well I'll give ya- No, I don't think it is," Adami protested, saying he thinks the stock could still test 14½ or 15.

Steve Grasso said the problem with Cisco is not the same problem as Mandy Drury (who really doesn't have any problems we're aware of but it makes for a clever comparison), "They're not sexy enough right now. ... I still would not be buying it."

Patty Edwards also was not buying. "You're still trading at 10.8 times this year's earnings. For me that is not cheap enough ... a third of earnings are under a cloud. A third. That is huge."

Steve Cortes was the only one hinting at a dabble, saying, "I am getting intrigued with it, I will admit," but he qualified it with, "the Juniper free-fall has to stop ... 15½ is where I'd buy."

He also said Juniper owners will need a lot of gin.

Edwards: Government
won’t let Sprint fail

Meanwhile, while the Fast gang was down on CSCO Thursday, everyone was sort of cheering Sprint.

Patty Edwards had the most compelling argument, saying, "Like the cheese stands alone ... I don't think that the government's gonna let them go under. So I think you do have a floor under it."

"Did Patty say 'the cheese stands alone'? Is that a saying? I've never heard of that before," questioned Guy Adami.

"That must be big out in Seattle," said Judge Scott Wapner.

"Oh come on," Edwards grumbled.

"Is that a Seattle thing," Judge asked.

"No no, that's like a nursery rhyme, 'the cheese stands alone'," Edwards explained.

Guy Adami called Sprint "extraordinarily compelling" near $4.

Steve Grasso said, "The low 4s? That's a great entry point in Sprint historically. ... I haven't met anybody who dislikes the service in Sprint. I haven't."

Steve Cortes called Sprint "a referendum on LightSquared," and "terrible news for Clearwire."

Pulte CEO & Judge Wapner
reach agreement

Pulte chief Richard Dugas should get some level of props for taking a mild, though thoroughly professional and obligatory, beating in terms of the questioning on Thursday's Fast Money Halftime Report.

The toughest question came at the end, from Scott Wapner, citing this column likening Pulte to Borders, and asking Dugas if Pulte will actually be around in 3-5 years.

"Unquestionably we'll still be talking about Pulte," Dugas said. "We've always been conservatively financially managed."

Steve Cortes asked Dugas why people should buy Pulte given its underperformance against other homebuilders. "I think it's an excellent time to buy our stock," Dugas said, rather generically, but he frankly said the company had done poorly with past margins, but now they're getting better, and "it is closing the gap."

Judge Scott Wapner told Dugas, "I did a bunch of research on your company today," and came up with 5½ billion in total liabilities.

Dugas initially challenged that, saying, "I think your debt number's wrong; our total outstanding maturities are a little over 3 billion, and frankly, we've been paying down debt."

"I had 3 billion as your long-term debt, 5½ billion in total liabilities," Wapner clarified.

"You're correct with that; I thought you meant long-term debt," Dugas said, although Judge's initial statement was crystal clear and accurate.

Judge basically revealed his own sentiments about the "crisis" level of U.S. debt, referring to "this nonsense with the debt talk" and asking Dugas if it's been hurting sales.

"To my surprise, up to now it has not had a big impact on our overall traffic levels or overall order levels," Dugas said.

He’d short it, except he sounds like he thinks it’ll go higher

Remember just a couple days ago when NFLX traded in the $250s afterhours and Joe Terranova was saying the Netflix story has "changed," and Jon Najarian was suggesting a possible bottom at $240 and then back up to resistance at $265? (This writer is long NFLX.)

But now that it's actually been around $270 for a couple days, Guy Adami admitted, "Right here, frankly, it still looks extraordinarily good on a chart ... the chart is not broken yet."

Steve Cortes said he'd short it except the short interest remains high. "If I see short interest start to come down, then I'd be interested in shorting that and perhaps even paired up against an Amazon long."

And we were hoping reading CNBCfix.com is the first thing he does every day

Steve Cortes told Dennis Gartman on Thursday's Halftime, "Reading your letter is the first thing I do every single day."

Gartman actually sort of agreed with Richard X. Bove, saying, "Unless you're a hedger, unless you're long some things, and short some things else, I think Dick's right, the sidelines is the proper place to sail your boat."

Sail your hedged boat on the sidelines ... for maybe a grand total of 48 hours, until Barack Obama and John Boehner and Harry Reid are smiling in pictures together and we're off to the races with QE3 again.

Gartman told Judge Scott Wapner that if there's debt deal, the dollar goes up, "oh absolutely."

They’ll drink to SBUX

Steve Cortes on Thursday's Halftime pointed to Brazilian trouble and said, "3 of the 4 BRICs are now down on the year."

But he hailed SBUX, saying, "I like addiction stocks. I like have-to products."


Patty Edwards, who early on looked like she might get mostly shut out but impressively clawed her way back into the fray, said Starbucks is a buy because of the "25% of their business that's international ... so I think it's definitely a long-term hold."

Edwards said of CROX, "Not a believer, but apparently the stock's working."

David Stockman:
‘We’re borderline game over’

These last couple weeks are basically the Super Bowl for debt critics such as David Stockman, who told Strategy Session viewers Thursday that we're inside the 2-minute warning and unlikely to pull this one out (gosh, that sounds like the end of XLV; the horror).

"This is very grim. I think, uh, we're borderline game over," Stockman said. "The problem is not the ceiling, it's the debt."

Stockman's primary concern is that is that the long-term structural problems he sees are basically irrelevant to the current conversation.

"The Democrats have now taken revenue entirely off the table. They folded. They caved," Stockman said. "Look at the Reid plan in the Senate. There is no taxes in it whatsoever."

Stockman said "The system is totally broken," and while we don't totally disagree with that and actually agree with many of his sentiments, we'd have to say, if the people hired to be in charge of this stuff don't seem to think it's as big a deal as Stockman does, then why should anyone else.

Basically America just has to make sure it keeps producing enough new kids to keep the long-term entitlement string going.

David Stockman is right
at least about 1 thing

David Stockman said Thursday they might "kick the can to January," a sign he didn't have much more thoughtful commentary to add to the discussion and basically no deeper than anything a high school sophomore might say.

Gary Kaminsky astutely noted, "We almost went through that whole thing without saying kick the can down the road," but of course, they didn't.

The strength of Stockman's arguments evaporates when he morphs into silly statements such as, "We are not a triple-A credit, we are borderline banana republic in terms of our finances."

Stockman began to make one point that would've been a legimately strong point had he further developed it, namely, "I think it's very unlikely that we will deal with this till after the election. That's 213 (sic)."

That has to be the reality, that any groundbreaking measures that could be a game-changer for either party certainly wouldn't be happening in a president's first term, but — if there are to be any changes to entitlements or significant tax revisions at all — is only going to be possible in a lame-duck administration.

The first term is where you get things like ObamaCare and No Child Left Behind and some incremental tax-bracket movement.

"We are going to be facing a day of reckoning here," Stockman warned.

A situation where fired workers may get the last laugh

Pulitzer winner Jesse Eisinger is not quite the free-market, pro-business champion of many on the CNBC shows in which he speaks, but he does have a lot of interesting reports on the banks.

Thursday, Eisinger said, the big banks might simply be forced to get smaller.

"It would be much better to sell off businesses to raise capital than to sell stock," Eisinger said, adding, "the model is really questionable, so I think it's a logical thing to happen."

But he conceded that a company such as Bank of America is too big for an activist, so when David Faber asked where the pressure would come from, Eisinger said it would have to be a "sea change" from the big institutional investors who are playing with other people's money and not their own, so maybe it's not imminent.

Gary Kaminsky spoke about Credit Suisse's job cuts of up to 4% of the work force and noted that many times firms cut and then have to ramp it back up when business improves.

But, "We're supposed to be in an economic recovery," so cuts like these are curious, Kaminsky said.

David Faber asked then if CS is getting it right. "Well we'll know in 6 months," Kaminsky said, but meanwhile, the "regulatory environment has created a situation where they can no longer guarantee returns on invested capital in certain areas of their business, so they just don't know."

And, the reality has to be, that there simply isn't enough business, and doesn't figure to be for a while, for all the banks that existed and continue to exist after some should've disappeared because the government is so scared of any big bank having troubles that it will protect them all.

Kaminsky offered this element to the debt discussions, saying that people think U.S. government debt is mostly very long-term, but "the average duration of the U.S. portfolio is 5 years."

As for Congress, "I think a lot of them forget the fact that if the cost of capital goes up, the actual increase in interest expense is gonna wipe out a lot of the so-called savings that are gonna be paying for the deficit."

Why DNKN backers probably wanted a low IPO price

David Faber explained on Thursday's Strategy Session why private-equity investors in Dunkin' Donuts maybe were happy that the IPO only priced at 19.

In fact, they got a lot of convertible bonds, and "they get to convert at 19," the IPO price, Faber said.

So, money wasn't really being left on the table after all.

Faber also chided himself when he told Gary Kaminsky, "At the end of the day, they also — have I said 'at the end of the day' enough times here? — if you hear me saying things over and over again, you just hit me ... I know it's annoying for our viewers."

Actually, it's not as annoying as "kick the can down the road" ("gotta leave it there" is passable because there really isn't much of an alternative), and Faber is the absolute best on CNBC at improvising one-liners about camera and teleprompter glitches.

Guest Michael Molano undoubtedly had interesting stuff to share about tech industry patents, but without specifying certain cases and merely speaking in generalities, this was duller than a Harry Reid speech. "Every decade we have a war like this," Molano said, adding, "history is repeating itself" (it doesn't), and that what happens is market share is sensitive for growing tech companies, and when they see threats, they'll call their legal departments and remind them they've got tons of patents and to start looking up some infringements because "I want you to start a war."

[Wednesday, July 27, 2011]

Steve Cortes: Dick Bove
made ‘ridiculous’ call

Dick Bove, while defending a curious everyone-into-cash call on Wednesday's Fast Money, told Melissa Lee, "I think we're dealing finally with some of the core problems that the United States financial system faces, I mean the government, faces."

And where were all these "core problems" in the last 12 months, when the typical subject instead was Dodd-Frank, QE2, the Volcker Rule, etc.

Bove spent a lot of time, which he was graciously extended by a charitable Melissa Lee, veering toward what apparently is his newfound thesis: "I think the problem is that we're restructuring the global financial system away from the United States."

If Deutschland wants those Chinese reverse mergers, be our guest.

Bove assured Lee, "I definitely believe the sky is falling," prompting head-shaking from Tim Seymour when he decried a country that's "bankrupt, can't pay its debt."

See, what's bogus about these remarks, and pretty much every one of these discussions, is that virtually nobody was talking about it as recently as a month or 2 ago, when all the fright-mongering was over Greece and QE3, or even last fall, when the worst crisis we faced was the "uncertainty" over what was going to happen with the "Bush" tax rates.

Now, suddenly, it's the end of the world as we know it.

"I think this is a ridiculous call," said Steve Cortes, although at least he didn't complain about Bove's hair color (see below).

Guy Adami said, "When the levee breaks, we'll have no place to stay."

Melissa Lee channeled Toni Carpenter of "Wall Street" when demanding of Bove, "What sort of time frame are you talking about?"

It’s 2011 now

Tim Seymour at one point on Wednesday's Fast Money said, "I think you're bringing up a really interesting point, right now, at, at the start of August, 2010."

Brian Stutland offers to help out
Jim Iuorio with his trade

Jim Iuorio told Fast money viewers that the market they experienced on Wednesday was sort of a facial for that TARP thing.

"Today I think the market almost seemed like punishment to the politicians," Iuorio said.

As for a trade, Iuorio said, "I would buy the TLT, the September 93/98 strangle."

Brian Stutland then indicated he'd be on the other side of half of that one. "Certainly one thing that I've been looking at, and looking at for investors too is actually selling some of those calls to Jim," Stutland said. "In some sense it makes some sense, but I would play it more to the short side."

Iuorio, who got the last word, rebutted, "It seems like we half-agree. The reason I threw the calls in there is if everything does get settled in the next couple days, there might be some knee-jerk reaction ... and people come back into Treasurys that supposedly have stayed away."

Are people staying away from Treasurys now? Wonder what'll happen when all that money that's sitting on the sidelines comes back.

James Altucher gives
boost to print media
while claiming GOOG $1,500

James Altucher said on Wednesday's Fast Money, "I'm so bored of these (sic) debt-ceiling news, I can't even open a newspaper anymore."

Altucher scoffed at the notion of a default-freeze crisis, saying, "People are still gonna buy tractors from Caterpillar. They're still gonna buy iPhones from Apple."

Karen Finerman suggested people might actually be worried about something — their jobs. But Finerman was more intrigued by Altucher's $1,500 price target on GOOG.

Altucher welcomed that question, pointing to the company's cash and multiple and asserting, "Just on that alone, the stock price should triple, the 600 now should probably be somewhere between 1,500 and 2,000." But then he said if you start giving the stock credit for Google+, which apparently is an instant smash, then you could add in the reported $80 billion market cap of Facebook, and easily get to the $1,500-$2,000 range.

"It's an easy call actually," Altucher said.

‘I’ll tell you what I do. I work in a paint store, and I got a raise this week’

Anthony Scaramucci's Hedge Fund Trade of the Week struggled to get off the ground Wednesday amid some mild dead-air wrangling with Melissa Lee over "deep deep value" definitions.

Scaramucci touted Xerox. "Management has made a commitment to the Street that they're gonna take 75% of the available free cash flow and buy in shares. So we're talking about the ability to buy in roughly half of the share count over the next 5 years," he said.

He said Greenlight exited, but Gotham, Glenview and Tiger Global remain in the name.

Guy Adami introduced a clip of Tim Seymour's ridiculous Rocky Balboa impersonation. Scaramucci said, "I can do a better John Travolta and Sylvester Stallone imitation than that, Tim." But he said he wasn't going to do it in this appearance.

Tim Seymour’s shop
is ‘having a good year’

We've gotta hand it to Steve Cortes.

He noticed a subtle detail on Wednesday's Fast Money Halftime Report that we didn't catch.

Specifically, the color of CVS chief Larry Merlo's hair.

"I couldn't help but notice that, did you see how much darker his mustache was than the hair on his head? Does he color his mustache?" Cortes asked his colleagues on the 5 p.m. Fast Money. "He gets those hair-coloring products from his CVS stores, uses 'em on the mustache," Cortes surmised.

Cortes also anticipated receiving hate mail when revealing of LVS, "I shorted it, I think that LVS — and I'm gonna get bad e-mails on this, boy people love LVS out there — I think the problem with this stock ... is Chinese weakness. ... I shorted it at 48, I'll risk it to just above 50."

Brian Kelly said, "I'm long Treasurys via TLT," and said AKAM's results are not a death knell for the economy. "I think it's specific to this sector," he said.

Jeff Kilburg told Karen Finerman, after gloating about Notre Dame "stopping" USC "12 years in a row," which isn't actually correct depending on your definition of "stopping" (gosh, this is like those defintions of "default" ... it was 11 wins in a row, and then a tie, and then another win) and was so long ago it's the equivalent of Xerox celebrating its dominance of the S&P 500, "Eventually in the next month or 2, I think we're gonna test 2½% in the 10-year."

Tim Seymour at one point went out of his way to deliver an update on his own firm's investment results. "We're not in a bad position, in fact, we're having a good year," Seymour said.

Brian Kelly talks to people
on the street about their stock market fears

Man, was the Fast Money gang falling for Washington bluster, or what?

Karen Finerman on Wednesday's 5 p.m. show warned, "We've seen a lot of complacency ... I'm a little worried," and not selling the VIX just yet.

Tim Seymour claimed, "Technically, again ... I think we're breaking down."

The goofiest overreaction came from Dick Bove (more on that later tonight), who actually wants to suspend trading until a debt agreement is reached.

But nearly as goofy was the observation of Brian Kelly, who claimed, "People I talk to, S&P 500 CEOs, high-net-worth individuals, and just people on the street (presumably lower-case "s" if we understand his comment correctly, because he qualified it with "just"), are very frightened about the market and the economy at this point."

Next time we're on the street, we'll ask some people if they feel the same way.

Guy Adami rattled off a bunch of corporate reports in support of Seymour's contention (ignoring the recent one by GDP play GOOG) but conceded, "every selloff has been a buying opportunity."

We'd put it another way, that as soon as John Boehner, Barack Obama, Eric Cantor and Harry Reid smile and shake hands on TV (possibly by Friday), the Dow probably goes right back up, and pundits on CNBC probably go back to Dodd-Frank or Sarbanes-Oxley or QE3.

Steve Cortes, to his credit, swerved from the U.S. debt talk and said it's actually a case of the markets pounding European stocks the way Rocky Balboa pounded Apollo Creed's ribs.

How come Juniper isn’t in the deep end of the trading pool?

Steve Cortes on Wednesday's Fast Money Halftime Report took a premise he's made before — and didn't take it far enough.

Zachary Karabell made a better point than Cortes, but he too didn't take it far enough.

The subject was Juniper, which took a much more massive plunge Wednesday than supposedly dangerous NFLX did this week.

"Simon I think the story here is that networking is in trouble," Cortes told guest host Simon Hobbs. "I think these companies are victims of government austerity."

Cortes added this is no buying dip. "I think further downside," he said.

Zachary Karabell, though, pointed out the austerity claim is dubious. "IBM, which is also servicing a lot of governments, is seeing increasing business," Karabell said, suggesting investors can't make a "binary call" as Cortes suggested. Karabell said that in the case of pure equipment and hardware companies, "that's an easy budget to go after."

This was an incomplete conversation, and here's why.

1 of 2 things is obviously happening.

Either Cisco/Juniper products are not very useful to governments and are mere excess, and taxpayers should be cheering the stocks' slide as a signal of governments eliminating the fat ...

... or, Cisco/Juniper products are useful, but unlike certain lobbyists, Cisco can't convince governments of that no matter how many Ellen Page commercials it tries (and which have been off the air for a while, a sign of their lack of effectiveness).

Either way, there's a problem here.

Stephen Weiss took a slightly different angle, suggesting JNPR is merely bogged down by a price war with CSCO and others.

Simon Hobbs informs guest he wasn’t answering the question

CVS chief Larry Merlo almost said the unthinkable on Wednesday's Fast Money Halftime Report about his visit with a Washington panel.

"I thought it was a great hearing," he said, with a high "level of engagement."

Simon Hobbs, who we realized slightly resembles Alan Mulally, asked Merlo if the Medco deal will make PBM industry pricing less competitive.

Merlo demonstrated he brought talking points to this interview for this question and launched into them, saying something about "bringing solutions to 3 key issues in the marketplace."

"Yeah but I didn't ask you about that sir. Do you think the pricing will be less competitive," Hobbs said.

"Well Simon, listen, the marketplace is, is, is, has always been competitive and I think that that will continue as we move into the future," Merlo said.

Merlo added, "We have no plans to, you know, break up the company."

Stephen Weiss opined that Merlo dodged the question because "it's going to be less competitive for pricing ... I like the stock quite a bit."

Zachary Karabell though was staying far away. "No, I don't wanna be in this kind of name," Karabell said, suggesting a 7% upside with "clearly much more downside" and recommending people who like this instead "go into a Brazilian bond for the same kind of yield. I, I just don't really know where you go with a name like this."

Steve Cortes turns the coffee trade into an ethnicity play

Zachary Karabell said he understands why DNKN would jump on its IPO, but "I am not going to dip into this, or dunk into this as the case may be, at current prices ... I like Starbucks better."

Stephen Weiss scoffed at the entire IPO mania, including LNKD, saying, "I wouldn't play any of 'em here."

Steve Cortes proclaimed unmatched expertise on the subject. "I'm the only Colombian I think on the network, so I know my coffee, and I will tell you that I think Dunkin' Donuts is the best coffee per value out there, I have it every single day." He said the name is a buy because it's one of those "affordable luxuries."

Dicker: Drillers ‘dead cheap’

Dan Dicker claimed Wednesday on the Fast Money Halftime Report that oil is "acting much more like gold," that Brent is the one to watch and not WTI, and that oil will remain at these levels at least "until we get this debt thing settled."

For value, Dicker suggested the integrateds are mostly fairly priced, but "the drillers show to me one of the great values in the oil patch, and I think it's going to be a multi-quarter kind of trend going forward ... they're dead cheap here, all of these."

Stephen Weiss shrugged and said "I sold my Weatherford today," because he bought at a good price and sold at a good price.

Michelle’s appearance

Steve Cortes said that when it comes to renewed European troubles, "I'm happy because I'm short the euro currency."

"It's still a mess over there," agreed Brian Kelly.

"It's deja vu all over again," said Zachary Karabell, unfurling the atrocious cliche.

Kelly described the U.S. standing in the event of a downgrade as, "We're probably a pretty decent double-A."

Kelly said that one the wake of Corning's slipping TV sales, "I would look to short Best Buy here," then he uttered a cliche that's rapidly getting almost as bad as the deja vu one (though it will never catch up), that Best Buy is a showroom for Amazon.

Steve Cortes actually pinned the TV-sales sluggishness on a tough labor market in which PAYX is having a terrible chart.

Zachary Karabell said "I'm short" Autonation.

Viewers got likely their biggest treat of the day when Michelle Caruso-Cabrera, in sexy glasses and utterly heavenly black outfit that prompted a bunch of Google pings to this site Wednesday afternoon, delivered breaking news on Greece austerity projections. "They expect a 30 to 50% recovery of principal by bondholders," MCC said.

Kate Kelly: SEC’s ‘metrics’ review pushing Groupon IPO to mid- or late September

Kate Kelly reported on Wednesday's Strategy Session that Groupon's IPO is being delayed by SEC scrutiny of its "metrics" — a term Kelly stressed rather than "accounting."

So, it "looks like the IPO ... won't come until mid- to late September as a result," Kelly said.

She said, "The SEC is reviewing Groupon's S-1 and discussion- discussing changes that might improve it," that "the dialogue is ongoing," and that it's about "self-selected financial metrics, notably gross profit and consolidated segment operating income."

Apparently CEO Andrew Mason's tough talk isn't a problem. "I'm told that the SEC does not particularly care about the manifesto," Kelly said, but she noted, "the company did change the tone of that letter."

Gary Kaminsky asked Kelly if this is an "SEC-Groupon-specific situation," or whether it's merely a reaction to the surging prices of recent Internet IPOs that might be making some people think there's obfuscation going on.

Kelly said, "I think the 2 options you presented Gary are not mutually exclusive," which we think means "it's both."

Roger McNamee owns
‘several percent’ of Facebook

Roger McNamee said so many things Wednesday on a Strategy Session episode that was so quotable it would probably take 2 days to do it justice that we're just going to have to let it rip with the highlights.

Most significantly, that McNamee revealed he owns "several percent" of Facebook.

McNamee: Recent IPO spikes ‘are people trying to pretend they own one of the good ones’

Roger McNamee on Wednesday rushed to downplay any suggestions David Faber had that Facebook might not be fully monetizing its user base.

"They have profit margins that look like the best public companies out there today," McNamee said.

"Being private hasn't harmed them at all," he added, and we have every reason to believe that sentence is almost completely true, with the possible exception as to whether employees or early investors with smaller blocs have actually found as much liquidity as the public market would provide. But all of that deserves a much lengthier analysis than this page can provide.

David Faber asked McNamee if he'd unload that "several percent" if the valuation indeed hits $100 billion. "No. Of course not I'm, I'm a long-term holder," McNamee said.

He scoffed at the collection of recent Internet names to go public, specifically Pandora, saying, "All these IPOs you're seeing are people trying to pretend they own one of the good ones."

‘The cool thing is, you know, they got rid of Eric Schmidt’

Roger McNamee on Wednesday celebrated what he claimed is the end of Google's "monopoly power."

"Temporarily it's a level playing field," he said. "Microsoft has lost its monopoly power. Google has lost its monopoly power. ... I'm just saying Google used to be able to dictate to every content publisher in the world the terms of engagement on the Net. That is over."

Actually, Google never dictated anything to CNBCfix.com about our "engagement" on the Internet, which still involves to a large extent people looking up information on Mandy's outfits and somehow ending up on this site and wondering, "What in the world am I doing here?"

Anyway, McNamee asserted, "The cool thing is, you know, they got rid of Eric Schmidt."

And because of the transition away from PCs, he said, "Apple's gonna outperform Google no matter what."

McNamee said "It's too early to tell" whether Google+ can put a dent in Facebook, but he concluded that the most likely outcome is Google+ being a success without any impact on Facebook.

McNamee on Groupon:
‘I whiffed on it’

Roger McNamee would probably go down as one of the greatest Strategy Session guests.

If he ever could've stopped talking Wednesday.

McNamee expressed steep skepticism about Groupon's model, though admitting he missed it in the early days.

"I had a chance to buy it private and I whiffed on it," he said. "I looked at this and I said, 'This is just an ad unit'." And so he thinks it's a "terrible idea" to invest in these names just by looking at financials and not using the product to determine how it really works, which, given that according to David Faber he's been a prominent Silicon Valley investor for 20 years, you'd think is a guideline he would've adopted many years ago.

But what they've got, McNamee said, "I think that's gonna be a very hard thing for them to sustain." He said it's valuable, but "10 billion valuable? Not to me."

He seemed to complain more about the Financial Accounting Standards Board than with anything to do with Groupon's "metrics," saying, "The problem with GAAP is that GAAP now is not 1 standard accounting for everybody. It's a mess."

Eventually, McNamee asked David Faber, "Can we move off Groupon?"

"I'm happy when our guest dictates where we're going," Faber said.

Roger McNamee,
and PMC Sierra

We first noticed Roger McNamee around the turn of the century (that's the practical definition of 1999-2000, not the 2000-2001 description that some purists insist on) when he became the hottest ticket (if that's not an oxymoron) on Louis Rukeyer's "Wall Street Week."

Back then, CNBC was a big deal, but there was no Cramer show or Fast Money, and stock-picking was widely scattered throughout the day, often in segments with Ted David or Neil Cavuto hosting a guest who took calls and gave a "buy, sell or hold" recommendation. (In that sense, stock-picking, you could say CNBC was actually a little bit behind its own curve.)

Anyway, "Wall Street Week" was past its heyday but still influential back then, and in 1999 and much of 2000, panelist after panelist would pound the table for Microsoft, Cisco, America Online, Nokia, etc., you know the drill.

Roger McNamee joined the panel not as a mainstream Wall Streeter really but a Silicon Valley eagle eye who was constantly talking about the next big things in the Internet that most people weren't aware of.

One regular pick was PMC Sierra, which was one of those "plumbing" companies that was going to help make the Internet faster and open up the onslaught of digital data that consumers were demanding.

Around that time PMCS actually traded around $250 — after a split.

In less than a year it probably fell something like 90%, and soon was in single digits.

Where it trades today.

Another one McNamee used to hail was Flextronics, when it was in the $40s.

New way of doing things, new way of supplying the tech buildout.

That one trades for less than PMCS and is now only famous for getting wrapped up in John Kinnucan's problems.

McNamee, from every appearance we've seen, is a thoughtful pundit of honest candor.

Some might wonder if his investment legacy and apparent fortune has less to do with regularly picking the winners over the losers ... and more to do with simply being in Silicon Valley since the mid-1980s, as opposed to, say, being assigned the automakers.

Judge for yourself. "I've written a very long slide deck that describes all of my theses and you can download it for free off the moonalice.com Web site," McNamee said Wednesday.

Strategy Session guests debate, but not at the same time

Nearly lost in The Strategy Session's Silicon Valley stuff Wednesday was this comment from Roger McNamee about a certain exchange and its boss, Bob Greifeld.

"Nasdaq, once it went to flash trading, it basically said we're not in capital formation anymore, we're just in the business of letting our market makers front-run their customers. And, if you're crazy to go public on Nasdaq right now ... once they did that he lost me completely," McNamee said.

"Wall Street has become a centrifuge, spinning the cash out of the economy and leaving us with broken homes," McNamee postulated.

Coincidentally or not, Greifeld was the next guest on Wednesday's show.

"With all due respect, I don't believe he follows the market structure as closely as somebody like myself or others," Greifeld said. "It's been a wonderful year for capital formation."

Bob Greifeld calls NYSE bid ‘brief interlude’ in Nasdaq’s agenda

If investors did not question Bob Greifeld's bid for the NYSE previously — and we're not saying they should've, only that they might've — they might've been doing just that after Greifeld's curious remarks on Wednesday's Strategy Session.

"We've said all along that it was opportunistic, we thought the pricing, the transaction was curious," Greifeld said.

He called the event a "brief interlude" for Nasdaq and said, "in our multi-year planning, it really doesn't even factor."

Interesting. So he calls a landmark offer to unite the nation's 2 leading stock exchanges merely a "brief interlude" and not even a long-term "factor."

Well, it's basically true. In fact, back on April 1, Jeff Sprecher (and not Greifeld) told The Strategy Session that the offer happened only after the Deutsche Boerse bid emerged and Sprecher and Greifeld spoke and realized, "Oh my gosh, if they really need scale, and if they really need to take costs out, we're probably the better partners," because Greifeld believes it's an "important social goal" for him to "fix the U.S. cash equities business."

Imagine if Ford had tried to buy GM, failed, and Alan Mulally said, "You know what, it really didn't mean anything, we were just trying to get it on the cheap."

"We have a very strict acquisition discipline," Greifeld assured David Faber Wednesday.

Obviously.

[Tuesday, July 26, 2011]

Making money shouldn’t
be so shallow

We've spilled endless amounts of ink praising Karen Finerman, but as Amazon surged Tuesday afternoon to another high (not to mention what gold has accomplished), we couldn't help but roll the eyes and scratch the head as Karen denounced yet another investment vehicle that's basically been a success for the entire Fast Money run.

"The valuation, I just can't even get remotely close there," said Finerman, who called AMZN the "deep end of the pool."

We should point out, we have no doubt — zero — that Karen Finerman is more successful at making money in the financial markets than we are.

What we don't understand is why for years she scoffs at stocks that are undisputably winners, while promoting dogs that have been about as successful during the Fast Money era as the Detroit Lions.

We've seen no proof ever offered on Fast Money (or really anywhere else) that P.E. ratio is an indicator of where a stock is going or that AMZN, for example, is actually in any more "deeper end" of any pool than CSCO or HPQ or BAC, which have proven quite adept at draining people's money over the sustained period of time that Finerman prefers.

There is demand for stock, there is earnings, and when you put the 2 together you get a multiple, or cart after the horse, or NFL time of possession.

The Zekemeister, Zachary Karabell, gets this, and suggested Tuesday that AMZN and NFLX are "gorillas" that are evaluated on different criteria than valuation multiples.

Dan Nathan conceded Tuesday, "These are really tough names to get in there, and make money on the short side."

Colin Gillis says price is truth, then talks as though it isn’t

While Karen Finerman may be permanently skeptical of AMZN shares, it was notable that none of her Fast Money colleagues were urging "buy" in Tuesday's afterhours.

"I'm hard-pressed to believe" it'll go higher from $225, said Guy Adami.

Dan Nathan also suggested it will pull back, though he noted he expected AAPL to do the same, and it did, but only for a couple days.

Mark Mahaney buzzed in to call the Amazon results "incrementally positive."

An Amazon skeptic, Colin Gillis, who gets all kinds of praise from Guy Adami for accurately predicting Research in Motion's demise but little mention for bungling AMZN big-time, spoke about Tuesday's jump with disdain, conceding "price is truth," but "the company's making less than 2 cents on every dollar of revenue."

He said an Amazon tablet will get looks strictly on price, but asserted, as far as share price goes, "it looks pretty full to me."

Melissa Lee asked Gillis if he needs to raise his price target from $160. Gillis actually joked about needing help from a debt-ceiling debacle to make that one work.

Then Gillis got into a minor debate with Zachary Karabell, who suggested the company wasn't getting enough device credit amid the demise of Borders, about whether the Kindle has been a plus for Amazon. "Are we sure the Kindle strategy has really worked," Gillis said.

‘Safe haven’ rejection could bring Guy Adami some more e-mail from AAPL fans

Guy Adami brought up his $285 call on AAPL and admitted "obviously that was wrong," but refused to accord AAPL with "safe haven" status because it's a retailer and no retailer is ever a sure thing.

Joe Terranova seemed downright giddy about being able to bring his AAPL-as-consumer-discretionary argument, pointing to oil's $115 bump many months ago; "that's when Apple peaked out."

Zachary Karabell said he had to clear up the "Trade School," saying, "There are no safe havens in stocks. If you want safe havens, go to a maximum-security prison or the grave."

Finerman: CLX too cheap

Anthony Scaramucci, like Karen Finerman, also tends to cite low-P.E. ratios in his Hedge Fund Trade of the Week recommendations, although he doesn't go as far as labeling high-P.E. stocks the deep end of the trading pool.

Tuesday, Scaramucci took something of a victory lap with RadioShack, saying, "This is exactly why you buy these sorts of stocks." He called it a "value stock with a single-digit PE" and said a "lot of hedgies like the name ... mid-20s price target."

The only thing we'd note there is that there are likely gobs of other stocks with a similar P.E. as RSH, and the reason RSH popped is not its P.E., but the Verizon story, and that who's ever been compiling a position was probably anticipating a story such as that.

Karen Finerman was down on Clorox's reaction to Carl Icahn, saying a couple times, "I find that a little disingenuous," and asserting, "I think it's too cheap here."

Howard Penney, speaking late about the apparent $20 IPO pricing of DNKN, said, "The debt's really not a problem," but rather the "bubble in coffee stocks ... it's being priced in a very frothy market."

A couple panelists gave Steve Grasso major props for his LVS call, and indeed he did say to buy it last week, but the only issue is, his rationale for buying was that it repeatedly has been a winner in August.

And last we checked, it's still July.

Nevertheless, "I think the stock goes north of 50," said Joe Terranova.

Melissa Lee in sharp black-and-white Tuesday at one point started to say flattery is the highest form of something before someone cut her off.

Dave Barger took a bit of a beating from Joe Terranova (crack spread) and Melissa Lee (possible unionization) but insisted JetBlue thrives on the "can-do attitude of the culture of our crew members," but no one asked about Steve Slater.

Fast Money’s Tuesday contribution to irrelevant debt-ceiling what-if conversations

In a discussion that absolutely won't matter in a day or 2, Lawrence McDonald guested on Fast Money Tuesday to say the debt-negotiation situation "reminds me of Lehman Brothers," where there was a "dislocation" based on the ripple effects being more extensive than some thought.

Karen Finerman basically deep-sixed this one, saying a lot of people that weekend didn't think Lehman would go under, whereas a lot of people think right now we easily could have a technical default or a downgrade.

McDonald, echoing consensus opinion you've heard countless times now, said, "I think Treasurys on the short end rally on a default or a downgrade."

Munster: Put ‘fresh money’
into AMZN

Some of the Fast Money gang continued to pronounce the NFLX story dead, with Brian Kelly saying on Tuesday's Halftime Report, "I am not a buyer," because this week's earnings are the "first cracks in this story," with margin compression and competition.

Gene Munster, who quite frankly continues to knock the AAPL call right out of the park, spoke about AMZN this time and said, "in the holiday quarter, you gotta be long Amazon ... you can put fresh money to work on this one."

Zachary Karabell even piled on with maybe his favorite theme of late, that Amazon (and Google from a recent appearance) should not be pilloried for investing in the business, but applauded.

Guest host Simon Hobbs — it seems that since Judge Wapner landed the Halftime gig full-time, he can't do an entire week — sounded like he sensed what Karabell was going to say and jumped on it, complaining, "everything is so black-and-white" with Karabell's analysis, and that what if Amazon were making some dubious investments, which apparently according to Hobbs would include buying Hulu and challenging Netflix.

Karabell didn't get a chance to rebut, but Munster said, "I don't think it's a risk in the next few quarters."

Jon Najarian said an Amazon tablet may be a case of careful what you wish for. Munster conceded Apple is so far ahead in that market but said it would still create a buzz for Amazon. Mostly, he cited international opportunity, that "there's a lot of parts in the globe that they're not a part of today," and isn't it curious how the same argument was used a day earlier against Netflix, that people in Latin America don't know what it is and don't have the right broadband.

Karabell ‘sad’ that
he didn’t short Ford

Zachary Karabell inadvertently found himself on the wrong CNBC show Tuesday morning/afternoon.

Karabell made an appearance on his standard Fast Money Halftime Report, but he probably should've joined Phil LeBeau with some questions for Alan Mulally on The Strategy Session, given that Karabell said, "I'm sad that I didn't short Ford ... they have real inventory management issues."

Joe Terranova went way off on tangent during a discussion of Paccar and Cummins, first pointing to the rails and the global growth story and how it's all there in all the markets.

Then Simon Hobbs asked for a call on Paccar and Cummins, and Terranova said, "Paccar and Cummins? I wouldn't be in either."

Jon Najarian hailed Cummins, saying, "I wish we did have an energy policy in this country, because this would be a big part of it," but as we all know, promoting an "energy policy" is basically just calling for alternative energy subsidy mandates that we can't afford while we curiously are in polarizing debt talks. Najarian and Brian Kelly also spoke about CLNE as that type of play.

Other than that, they’re great

Zachary Karabell on Tuesday's Fast Money Halftime Report described airlines this way:

"These are low-margin, really difficult, incredibly costly, problematic businesses, even if the cost of fuel were a lot lower."

Oil expert: The company sitting on huge breakup value is XOM

Oil analyst Fadel Gheit was asked by Brian Kelly on Tuesday's Fast Money Halftime Report if there are some big oil names that would "unlock" value by breaking up.

"The company that can break itself up and create huge, huge value is ExxonMobil, but it's very unlikely that that will happen," Gheit said.

Gheit hailed mid-continent refiner plays including Marathon Petroleum, Holly and Frontier, and said that BP's unknown liability will find a "settlement probably before February of next year."

Joe Terranova suggested NOV and WFT but said OIH might be the best bet in services. Brian Kelly added ESV to that, partly because it gets its revenues in the British pound.

Terranova also said, "nothing wrong with the Occidental story."

Terranova insisted at the opening that, based on the UPS results, "I don't think we should be concerned about global growth." But Brian Kelly countered, "I would stay away from both UPS and FedEx."

John Najarian said, curiously during the UPS discussion but not the AMZN discussion, that the outcome of Amazon's tax issue is a big factor in UPS and FedEx fortunes.

Our question for Alan Mulally: What is your company making that makes people go ‘Wow, I’ve gotta buy one of those’?

Ford CEO Alan Mulally, a fine guest and by all accounts a fine CEO, spent about 5 minutes with Phil LeBeau on The Strategy Session Tuesday and talked about all kinds of numbers, those on the balance sheet and those purportedly to come in the form of GDP and consumer spending.

About the closest the 2 came to actually discussing a product was when Mulally said his company is "making the best cars and trucks in the world worldwide."

Some might question that.

According to latest "initial quality study" rankings we could find on the J.D. Power Web site, Ford received a 3, on a scale of 5, for "overall quality." A 3, according to J.D. Power, means "about average."

Lexus was the lone brand scoring 5 of 5, but several others scored 4: Honda, Acura, Mazda, Mercedes-Benz and Porsche. (Toyota posted a 3.)

Also notable is that Ford does not score higher than a 3 in any of the 9 categories. It's all 3's, and one 2.

It might stretch belief to think an automaker rated "about average" across the board is actually the one making the best cars and trucks in the world."

The question LeBeau should've been asking, in our opinion, is not about cash flow and the question LeBeau always asks auto CEOs (industry sales forecasts for the year), but whether Ford is actually doing anything "above average" that will make the stock a "story" or anything more than a financial engineering/GDP play.

Even a baby step would be a big step. For example, advertising. The U.S. auto market has been saturated for the longest time like the burger market, cola market and beer market. In those mature industries, you seize a few points of market share, that's a big deal. Do "Where's the beef," or the Lite Beer easy-openin' can, and you can get people talking about your product. Is Ford capable of offering a memorable pitch, or is something even as stale as Bob Seger just a pipe dream?

One thing we noticed about the conversation was that Mulally rattled off several model names — the Focus, the Fiesta, the F-150 — that have been around a long time.

Mulally expressed the belief that "pent-up demand for vehicles is very strong," not the first time we've heard that since 2009.

Gary Kaminsky said Ford shareholders are likely happy that Mulally didn't talk about acquisitions Tuesday because those haven't worked out well for Ford, and that returning cash to shareholders is probably a better option.

Megan Mullally, spelled differently and evidently no relation, was in "Risky Business," in which Tom Cruise secured lifetime employment for Bob Seger.

All those banks, so many great products to sell into such great demand, but they can’t because of ‘uncertainty’

Bernard Beal took a seat at The Strategy Session table on Tuesday and seemed fully comfortable, yet, because he was tossing around the NFL analogies, it needs to be said that, he perhaps needs to think less about the game and just start hitting some people.

Basically across the board, all Beal talked about was "uncertainty," and we just don't buy it.

In a discussion about UBS and the PaineWebber unit, Beal spoke of how Dodd-Frank puts overlapping agencies in charge of certain regulatory functions. "The NFL is coming back, right," Beal said, and so he drew a comparison to dealing with both the CFTC and the SEC as similar to playing football with "3 different sets of referees."

Or, maybe a better way he could've put it is that you call 911 when you get burglarized, you deal with State Police when you're speeding, and you deal with TSA at the airport, and nobody seems to complain about the "uncertainty" of various enforcement agencies.

But that's not our gripe. Beal said that with clearer regulation, "you would absolutely know what you're going to do next," and it would start "allowing the system to work again."

What he's really doing is making excuses for the financial/financial services industry, whose products — not all of course, but some, namely mortgages for people unable to prove they can afford them — have recently proved disastrous for many people and for the nation, and features products that are far less in demand than in 2007.

Gary Kaminsky said it's imperative for a business like UBS to monetize its human capital some way. "Don't send me the nasty e-mails UBS," Kaminsky said. "It is a human-capital business."

How soon till Aug. 2?

Every program on CNBC these days is about a non-hypothetical, and finding any useful information is difficult.

Bernard Beal did point out on Tuesday's Strategy Session that "whenever we've come up against a debt ceiling, one of the first things the federal government does is close the SLUG window. It's been closed since May 6th."

Although, if you weren't worried about that on May 7th, there's probably not a whole lot of reason to worry now.

Beal was discussing whether states will take a hit from a federal downgrade or default given how much the states get from the feds. Beal suggested the states are under pressure; "it is the uncertainty that is causing a problem."

Gary Kaminsky said, "As far as the downgrade. Who cares? ... We're already assuming double-A given the credit standards."

Bruce Zimmerman of the University of Texas sleepily pointed to 3 factors of the debt debate, "political, economic, investment," and said politicians probably care more about their careers "than what's right for the government."

[Monday, July 25, 2011]

Melissa Lee, Amelia Bourdeau
have low standard for ‘crisis’

Melissa Lee on Monday's Fast Money brought on Amelia Bourdeau, our favorite Money in Motion trader (at least until Rebecca Patterson started talking about her bikini and showering in gold, see below), and the way they talked, you'd think something important was happening.

"What is a bigger deal, the U.S. debt crisis, or the sovereign debt crisis," Lee asked.

"Right now, it's the U.S. debt crisis," said Bourdeau, grinning constantly yet not quite standing close enough to the Fast Money table.

Bourdeau's "risk-averse" trade is short Canadian dollar/long Swiss franc, because "anything that's negatively impacting the United States also negatively impacts Canada, and this Can/Swiss cross has been, you know, less whippy."

Karen Finerman challenged that, saying, "A spike in oil prices could be bad for the U.S. dollar but you could see a scenario where it's very good for the Canadian dollar."

"That's true," Bourdeau admitted.

Stock falls to price
of a month ago

The Fast Money gang was ready to declare the NFLX story dead Monday. (This writer is long NFLX.)

Joe Terranova opened the show asking, "Is this finally the moment" for short sellers, and concluding, "You can say that the story has changed."

Melissa Lee asked Jon Najarian if it's all over for NFLX.

"What the short sellers were really saying is that there's something pretty close to a fraud going on at Netflix. I don't know that that's being endorsed by these earnings," Najarian said.

He said that according to the report, "it's costing them more money to get subs in the door, and, uh, they're getting fewer of them."

Najarian concluded, "In all likelihood we'll see a little bit more of an extension tomorrow on this news."

Dr. J later said the key level will be the $240.12 low on June 17. "Look for us to gather, if we get that low that is, I look for the stock to gather itself there and then to test back up to about, uh, the 65 level ... next area of resistance to the upside."

Adami: NFLX below $250
is ‘broken’ chart

While Dr. J played the NFLX report straight and true, his colleagues were staying miles away.

"It's not a stock we would own or would ever own," said Tim Seymour, explaining Monday's reaction is what you get in names like this.

"I'd never be long, I'd never be short," said Karen Finerman.

Guy Adami said, "If we get a close below 250-ish, that chart becomes broken."

Mel Lee, in another sharp conservative dark gray/black dress, brought on pro-NFLX analyst Mike Olson, who said, "I think the reason though that people are really upset is the Q3 guidance."

Herb Greenberg tried to badger Olson into analyzing some $400 million or whatever it is of accounts payable changes, but Olson wouldn't bite. "That's something we need to dig into," Olson said, citing "complex accounting."

Dunno. Could be a plunging knife. In late April it fell from $251 to $228 in a day and recovered in a month. A 10% drop doesn't feel like FFIV plunging from $138 to $109 in a day in January, nor does it feel like SINA in the '80s, which actually turned out more than OK.

In fact, it feels more like the LULU call by Steve Cortes and Liz Dunn at the end of May, you know, it's all over, the valuation, margin compression, end of high-end apparel shopping, etc., and down 15% we go.

And you know how that one turned out.

Tim Seymour on Monday was hailing BIDU, which itself was just in the $120s a month ago. "This stock allows the other ones to trade where they do," Seymour said.

Dennis Gartman: out of quotes

Melissa Lee introduced Dennis Gartman on Monday's Fast Money by referring to her Friday afternoon coverage of Barack Obama's angry press conference, which occurred after Money in Motion, in which the real story was Rebecca Patterson's bikini conversation (see below).

"We were chatting on Friday," Lee told Gartman and viewers, and said the 2 of them concluded, "you know what, the markets are going to digest it fairly well. And people thought we, we lost our minds."

Gartman agreed and said the development is that "the Democrats have taken revenue enhancements off the table."

Gartman is not a cliche machine but infrastructure, and said Monday, "We've heard this too many times before; we're gonna kick this can down the road to the election next year."

But, "I'm OK with that," he said.

He said that just recently he found the buy-gold-in-euro-terms trade a bit crowded, like Yogi Berra says, nobody goes there anymore it's too crowded (yes Gartman said that too), but now he's started to buy back in because of the European situation.

"I'm comfortable with it," he said of that trade.

Melissa watches
The Strategy Session

Melissa Lee asked guest Jack Malvey about Stephen Walsh's comments on Monday's Strategy Session, in which Walsh said a downgrade of U.S. debt could actually pinch the high-yield holdings of fund managers who have to maintain the average rating of the whole portfolio.

That would mean "sell the junkier stuff," Lee said.

"That's a hypothesis," said Malvey. "The reality is, investment guidelines typically are more flexible."

Karen Finerman asked Malvey, "Is there any cure period for a U.S. default?"

"I'm not really sure," Malvey said, calling it "novel territory." (And we thought it was a "crisis").

Malvey, who spoke as abruptly as anyone in recent Fast Money history, seemed to jiggle, and looked about as excited to be there as Harry Reid at another debt meeting, gave a confusing answer to Joe Terranova about strong gold and weak dollar in the wake of a debt deal, suggesting "maybe lightening up in those arenas because there's a tremendous risk-aversion trade under way here."

Melissa reads the blogosphere!

Scott Nations said on Monday's Fast Money of RIMM, "I think option traders are gunning for that 20 level."

Then he made a startling pronouncement: "RIMM right now is in a race. It has to get low enough, fast enough to get bought out before the technology becomes irrelevant," Nations said.

Karen Finerman said of AAPL, "I'm long, I'm happy to be long." But, "I wouldn't be inclined to trade around it, because it's so hard to get back in, and you do have to pay more than where you sold it, and you feel like an idiot."

So, we interpret that to mean, never sell it.

Tim Seymour said (sigh), "I don't own Nokia here, um, but I'm always looking."

But then he said, "Samsung is the name I think you need to own ... they're eating Nokia's lunch."

Melissa Lee said that according to the "blogosphere," there's a BGR report that AT&T is telling employees to be ready in September "huge influx of traffic" into stores.

Seymour defends call resoundingly mocked by Halftime gang

Tim Seymour said he wasn't ready to jump into U.S. Steel just yet. "You need to see iron ore and coal prices go higher before steel companies go higher," Seymour said.

Joe Terranova sees X as less significant nowadays, "I don't think it's a read-through anymore."

Guy Adami said there might be a "bit of a double-bottom 39-8ish."

Joe Terranova said he's been buying Ford for several reasons, including the balance sheet, and the "first automaker to pay a dividend in 2012."

Unlike the Halftime crowd including Steve Cortes, Tim Seymour defended the UBS European stock call, pointing to strength in Germany and saying, "I don't think this is a, a, daring call, in fact I think it already has outperformed if you're a European investor."

Karen Finerman said of HCA, "I wouldn't jump in just yet."

Scott Nations' option trade is to buy the weekly $34 call in TBT. Melissa Lee asked why not play it via the TLT. Nations said because the TBT is a double-the-move play.

"Ah. OK," Lee said.

Fast Money gang continues pining for SALT

Anthony Scaramucci's Vegas gathering remains a big hit among the Fast Money gang.

Joe Terranova welcomed back Tim Seymour to Fast Money on Monday, saying, "Not since the pool at SALT did we last see ya."

At the end of the show, guest Ken Austin, the Avion Tequila guy, said there was a character with his name in the "Entourage" movie, but his wife told him he couldn't play it.

"Why's that? Come on," said Tim Seymour.

"I don't look like you Tim," Austin said.

Austin said he couldn't give out show details because "I don't want HBO to come and shoot me." Guy Adami held up a bottle of the Tequila and said, "This is a weekend for Pete Najarian."

Tony Wible: NFLX hiding cash-basis losses ‘with accounting treatment’

Netflix critic Tony Wible basically had an answer for everything on the Fast Money Halftime Report on Monday.

First, Wible described the future earnings call this way: "Ultimately we're gonna see some pressure on the margins and possibly the guidance going forward."

Judge Scott Wapner pointed out that no matter what the skeptics say, "the stock just keeps going higher."

Wible pointed to AMZN and sought to draw a distinction that he never actually drew. "The fact that there's a known quantity of people to have broadband homes in this country; if every single person in this country had a broadband connection, had a Netflix subscription, you know, you'd end up getting ... about $170 value on the stock."

Pete Najarian asked about growth in Latin America. Wible asserted it's "slower DSL technology" and that people there are unfamiliar with the brand.

Then Judge Wapner asked about content costs.

"This is a company that's actually losing money on a cash basis and it's hidden it with accounting treatment," Wible said, which is a serious allegation.

Wapner recognized it as such, and said, "The SEC hasn't said anything, right. There's no investigation going on of any kind of shady accounting over there, so at some point, maybe it's not an issue."

"Nor am I saying it's an issue," Wible insisted, although that's exactly what he did.

"But merely bringing it up though sort of makes it a cloudy picture, doesn't it," Wapner asked.

"I'm saying that you need cash to grow," Wible said, explaining that in his view the company was turning to its subscribers for cash, and "it speaks to really the unsustainability of the business model."

So, what do we have here ...

The first argument was margin pressure and lower guidance.

Then it became valuation.

Then it became Latin America's a bust.

Then it became shady accounting.

Then it became pricing unsustainability.

Or, put another way, stocks with a high P.E. don't go higher, nobody in Latin America will buy a new product that they haven't heard of before, and ability to raise prices is a bad thing.

Somehow, it feels like we've seen this movie before.

They’d rather talk about CSCO, HPQ, MSFT, and other ways of making fast money

The Fast Money gang didn't want any part of NFLX on Monday's Halftime Report.

"It's really hard to bet against this name Scott; I don't think there's a comparison you could make," said Steve Grasso. "Guys that own this stock, love this stock, and they're not gonna be shaken out."

Pete Najarian said buyers should probably wait for a pullback. Steve Cortes said "In the case of Netflix I think competitors are on the way," but he wouldn't short it because the short interest is so high and almost suggests the true contrarian play is to go long the name.

Brian Kelly said, "I tried to short it 1 time via options this year, I got burnt." (This writer is long NFLX, but in Monday's afterhours.)

Doug Kass listens
to Hall and Oates

Doug Kass on Monday's Halftime Report helped us out a bit in our Fast Money music compilation, explaining he listens to the Guess Who and Hall and Oates.

Kass picked "No Time" as the theme for his segment, saying he mulled "Out of Touch" by Hall and Oates, but, "I didn't want to admit I still listen to Hall and Oates."

Neither is a big favorite around here, but we'd have to consider Hall and Oates less embarrassing than the Guess Who at this point, though we can't imagine ever quoting either. We said a month ago that Kass probably hasn't listened to any music made since 1987, and Monday's quotes would seem to reinforce that notion.

Kass was taking part in yet more debt-negotiations hypotheticals, saying, "I think that the market will rally into this uncertainty and sell off on the, uh, ultimate news that a debt ceiling was put in place."

Then he succumbed to an even worse cliche given its endurance than what Chuck Schumer ("kick the can down the road") offered at an afternoon news conference, saying the way the talks are going, "it's "the good, the bad and the ugly."

We can't remember which was which and actually don't much care, though Kass said what he fears "is the way we're getting stuff through Washington. ... I think Daley and uh, um, the rest of these guys, Boehner, the speaker of the House, have watched Sorkin's 'Too Big to Fail' too many times" in talking about fixing things before the Asian markets open.

Kass said longer term the market might be a short because of "ramifications of austerity both here and abroad," which must be the ugly.

He said, "I am still long TBT but I have reduced the position."

UBS should consider supplying a spokesman the next time it’s on Fast Money

Pete Najarian said on Monday's Halftime Report that "400 will only be a pause" for AAPL.

Steve Cortes, who up until a few weeks ago used to insist that AAPL was leading the whole market lower, now says, "This has been an incredibly narrow rally. The rally is really all about Apple and a few other high-flying names."

Pete Najarian begged to differ, saying, "Look at Intel, look at Microsoft ... percentage-wise, Apple hasn't moved a whole lot."

Brian Kelly said of P, "I personally would stay away from this Pandora."

Steve Grasso warned people about playing the activism element with E-Trade. "There's nobody who has any clarity in this space; so E-Trade has burned a lot of different people."

Without a guest to harangue, Judge Scott Wapner led the Monday gang in mocking UBS' pro-European equity call.

"You've still gotta be in United States equities," said Steve Grasso.

"This is ludicrous advice out of UBS," said Steve Cortes. "Even today, European banks are getting slammed."

Pete Najarian said gold might stall, but "the miners still have room to the upside."

Kelly: Nails WLT

It wasn't one of the bigger Fast Money spectacles, but back on July 6, Brian Kelly recommended WLT, which is one we've watched for a long time and is often recommended by Guy Adami.

That day, the stock was selling off about $6 to $115, and Kelly said he liked it on the weakness.

It's worth noting the stock did fall to $109 a week later. But after just 2½ weeks, it's over $130 — another sign that in high-beta land, waiting for a bounce can be well worth it.

As Congress goes to the bullpen, you might want to pinch-hit for junk bonds

Unfortunately the media world is utterly stuck right now in government minutiae — or put another way, there's nothing to report except the same "maybes" that have been reported for months and profoundly dull "stories" of incremental negotiating tactics, day after day, sort of like if a baseball game lasted 2 weeks and TV/newspapers were required to report on every inning.

In that vein, The Strategy Session on Monday brought on bond-watcher Stephen Walsh to hypothesize yet a bit more about what might happen and a couple of if/thens ... and Walsh actually made a fairly fresh point.

Walsh said "clearer minds will prevail" as things get into the "9th inning," all cliches you've heard countless times recently.

But he did allow that in the event of a deal, even "with a more modest package, we do think a downgrade has a possibility," but that the possible downgrade has "largely being and has been priced into the marketplace over time," and thus would bring "not a significant impact" if it happens.

The trade, then, according to Walsh, is not to fear Treasurys, but to concentrate on low-investment-grade or junk, because, "if you knew nothing else, you'd actually have to sell lower-quality assets to bring your average quality up."

Gary Kaminsky made a good observation about something you used to hear on CNBC in May and June but somehow don't anymore: "What happened to all that conversation about QE2's gonna end, what's gonna happen with corporate spreads."

Kaminsky asked Walsh why corporations aren't just "issuing massive amounts of 5 and 10-year bonds, and just going out and buying stock." Walsh indicated it's not really needed because corporate balance sheets are so strong; "they're in brilliant condition right now."

IPO bubbles: Even the guys working on Dunkin’ Donuts can’t believe it’s going so well

Kate Kelly, in fetching black and gray Monday, was all smiles while explaining how the debt-ceiling talks might hamstring the IPO market (see, that's another one of those what-if news reports).

Dunkin' Donuts, Kelly said, "may be the last deal of note that gets accomplished before a deal is struck," and "things could get slow in the absence of news" if there's no debt deal this week.

Gary Kaminsky said of Dunkin' Donuts, "They're selling this, David, as a growth story ... same-store sales are gonna explode." Faber agreed it seems ludicrous to think of there being any more places without a Dunkin' Donuts already, but apparently the notion according to Kelly is that there are gains to be made in Asia and in Baskin-Robbins.

"Some people who are actually working on the deal are surprised, but it is going very well, according to what I hear," Kelly said, smiling so much you'd have to think she finds this all a bit dubious.

David Faber noted that Scott Sperling was on last week but "he wouldn't talk about it as he wasn't able to," and as a matter of fact he didn't really talk about anything including the stuff he was able to.

Faber also noted that HCA is already "trading below the IPO price" in the "first quarter since it became a public company."

Yield Hunter Ron Carson guested on Monday's TSS to talk about dividend-paying stocks, explaining he has a "4-step investment process" but not quite illustrating what those 4 steps are, other than strong likelihood of being able to continue paying dividends, and barriers to entry.

His top pick is COP, largely because there's not enough oil in the future.

Carson also likes Abbott. But Gary Kaminsky asked a specific question about whether Abbott's dividend can be considered safe in the face of ObamaCare, and Carson never gave an answer, other than to say, "I think that's a good observation."

He said Abbott is a play on "living in an aging population," an investment thesis that's been around about as long as Brett Favre.

Carson also likes Exelon, because it's the premier name in nuke plants and it would take someone else minimum 7 years to build a new one.

In the span of a minute,
Fox Business goes from covering Murdoch scandal ‘a lot’ to ‘all the time’

He much preferred to talk about Geithner.

But we were more intrigued by Charles Gasparino's thoughts on the News Corp. situation — and perhaps why he never talks about it — during Sunday morning's "This Week" with Christiane Amanpour, the first time we've watched the show.

"Well, it's, you know, it's a story, we've been covering it a lot. Um, thank God I cover Wall Street, I don't have to report on my boss," Gasparino explained.

The Fox Business muscleman opted to speak only of the positives, claiming News Corp. shares rallied once Rupert took a seat in front of the Parliamentary panel.

"When they heard him, his explanation, they believed him," Gasparino asserted.

(Actually's it's more like, when they saw Wendi Deng sitting there with arms crossed, they saw something like Mrs. Ruskin in The Bonfire of the Vanities and said, "Whoaaaaa.")

Gasparino's soon-to-be-archrival Arianna Huffington begged to differ, saying, "Actually the coverage of Fox and the Wall Street Journal of this story has been embarrassing for journalism."

"We're covering it all the time," Gasparino said, and as the pair talked over each other, added, "Fox has been covering this very seriously Arianna."

Christiane Amanpour wanted none of it and ran for the hills, saying they could "hopefully discuss this .. in the green room."

Gasparino: Geithner’s
remarks ‘irresponsible’

Charles Gasparino couldn't wait to jump on the Treasury secretary's default comments Sunday with Christiane Amanpour.

"I actually think this is a good debate. And I- and I think it's irresponsible for Geithner to go out there and talk about default. We are not gonna default. We have enough money on hand to pay off bondholders. Why does he keep seeing that?" said Gasparino.

Gasparino recommended, "Take default out of the picuture. It will destroy the markets. It will really hurt this this economy," saying President Obama is hinting at paying defense contractors instead of bondholders. "That's the signal he's sending to the markets."

As expected along the partisan lines, Arianna Huffington called it a "completely artificial crisis," saying there are things like "crumbling bridges" in more dire need of attention, prompting Gasparino to assert, "isn't it good that we're actually talking about this."

Arianna insisted "1 more percent of growth would actually do more in solving our deficit crisis than any cut in entitlements."

And when Gasparino carped about how small-businesses "are worried about higher taxes" and how this whole debt thing really is a jobs issue, Arianna responded, "the jobs issue's a demand issue Charlie, you know that."

"Why don't they trust demand," Charlie said, as they talked over each other, and then in a borderline fall-out-of-chair moment, got a brief stare in at her while saying "OK."

Gasparino claims ‘Texas taint’ to Republican presidential hopefuls

Christiane Amanpour notably pronounced "migraines" as "mee-graines" on her show Sunday morning, prompting Charles Gasparino to say, "I know a lot of people with migraines. On Wall Street. They're having more lately."

Arianna said Bachmann is "definitely getting the female treatment" on this subject and revealed how she was "reading the original story in the Daily Caller," which of course was probably excerpted/rewritten and posted on the Huffington Post Web site with a higher Google ranking than what it had on the Daily Caller.

Gasparino claimed Wall Street Republicans won't support Rick Perry because "I just think there's a Texas taint to it all," and that's bogus; while Republicans probably are a bit tired of Texas, they'd be happy to support him if they thought he seriously could win.

[Friday, July 22, 2011]

Rebecca Patterson:
‘I feel like I should be in a bikini’

We've gotta start paying closer attention to Money in Motion, because far more interesting things are being said there than we would expect from a currency-trading program.

Melissa Lee, in conservative navy dress Friday, introduced a segment she called "gold gone wild," then asked Rebecca Patterson for a trade.

"I'm still on gold gone wild," Patterson said. "I feel like I should be in a bikini. Showering in gold or something, ah ha. I'm a little too old for that."

Let this page be the first to say that last sentence is not true, and that Patterson's idea is definitely one worth exploring, especially if we can get Melissa on board, and that if Patterson shows up in bikini showering in gold on-air, it will be the most-watched clip in CNBC history.

Andy Busch: out of ideas

Andy Busch seems like a gregarious television personality who demonstrates a large amount of knowledge of global finance.

But whenever an expert on CNBC says something like, "They definitely kicked the can down the road," as Busch did during Friday's Rebecca-Patterson-in-bikini session of Money in Motion, you have to wonder if they couldn't find somebody else to say something a little bit more illuminating, like maybe more from Rebecca Patterson on swimsuits.

Judge Wapner gives Grasso a break

Steve Grasso, at times seemingly running roughshod over Friday's Fast Money Halftime Report, fielded an innocuous question from Scott Judge Wapner.

"Grasso any idea where the stock could go to if in fact Apple does get a piece of Hulu," Wapner asked.

"Oh, every time someone asks me to comment on anything other than Apple, I always stick my money with Apple," Grasso whined.

Yeah — except Judge wasn't asking him to comment on anything else but AAPL.

Grasso wasn't done dodging/misunderstanding, asked by Judge what would make him get back into AAPL if he got out at $280: "It's like ex-girlfriends, you never wanna go back to the same girl, I wanna go on and see, uh see other opportunities, but it doesn't mean that I don't like the name."

Stephen Weiss said "I'd much rather go with Sandisk" than AMD.

Generally interviewers don’t much like to be the interviewee

Not only did Judge Scott Wapner give Steve Grasso a break by not chiding him for wrongly interpreting his perfectly good question, but Judge even got an unexpected demand from No. 386.

"Do you think Medicare, Medicaid, Social Security is gonna be dealt with," Grasso asked Wapner.

"You know, I just don't know, maybe after the deadline it's dealt with," Wapner said after a slight pause, not anticipating the question.

"So, so, I'm gonna say no, and no, and that's why you see gold and silver running up," Grasso said.

Zachary Karabell puts
‘uncertainty’ in air quotes

CAT got their tongues on Friday's Fast Money.

(Gosh, have we used that one before? We don't think so, but if it turns up, we'll make sure to complain to the moron running this site.)

Pete Najarian on Friday's Fast Money Halftime Report was undaunted by the CAT drop.

"I think it's an opportunity," he said, because the company is "hitting on all cylinders right now."

Steve Grasso said $103.75 is the number to watch, but be careful, because "they wanna let it grieve a bit for the first couple of days."

Zachary Karabell, more casual than usual, took Scott Judge Wapner's question of whether it's a "great opportunity to get in on a great name" down a notch, saying, "I think it's a good opportunity to get in on a great name."

Judge asked why the level of restraint.

"I don't love any CEO blaming 'uncertainty' for soft business," Karabell said. "I think that's usually what people say when they don't necessarily want to deal with an internal issue, and it's an easy thing to hang a peg on."

Karabell said he likes the name regardless but bought Joy Global instead a few weeks ago.

Stephen Weiss said the issue with CAT is, "You see them beginning to lose a little share" in China. But, "I bought some, I think it looks good here."

Shocker: GE gets nicer treatment than MSFT, CSCO and BAC did

One of the early projects of this site was to tackle CNBC's seeming 1) reluctance to talk about GE's troubles on-air, and 2) perceived tendency to speak more positively about GE and its management than other companies with similar stock performance (or even better stock performance actually, just compare remarks heard on the network about Steve Ballmer and John Chambers and Brian Moynihan vs. what you hear about Jeff Immelt).

Tackling this topic even — barely — got us on the new-media map in the early days. (Then we got caught up in Pete Najarian heavy-options-activity land, and the media watchdogs stopped caring.)

Anyway, the Fast gang took up General Electric with impressively realistic guest Jeff Sprague on Friday's Halftime, and shockingly, nobody spoke about it nearly like they've spoke about MSFT a day earlier.

With GE, it's totally serious, all of the time, all of these GE products are serious, long-term-wise ventures and not silly ideas like Zunes or Skypes.

Sprague said "the growth is still being led by GE Capital," and that "GE Capital's in a healing process."

He said if you do a sum-of-the-parts between industrial elements and GE Capital, you get a price around $20, so, "I think it's actually hard to get the stock much above the low 20s."

Steve Grasso said "19.38 has been resistance in GE, 18.89 has been support."

Steve Grasso indicates he was the model for Don Draper

Willie Williams, who unlike Rebecca Patterson doesn't need to appear on CNBC in a bikini (see above), did the Money in Motion teaser on Friday's Fast Money Halftime Report, saying, "My trade is to sell dollar/yen ... I like selling it at 78.50 with a stop loss at 79.75 and I have a target of 75."

Stephen Weiss said "Ruby Tuesday's still a value trap."

Steve Grasso used AMR's decline Friday as vindication for declaring Thursday he doesn't own airlines, saying, "I wouldn't recommend it."

No. 386 scoffed at the end of the program about Judge Wapner's report of Kim Kardashian suing a lookalike ad. "Because Don Draper they had to knock off from me," Grasso chortled.

"I told you man, you look like that dude pony boy from the outsiders," Wapner said.

Incoming Verizon CEO has
the spin thing figured out

They've gotta quit giving Gary Kaminsky these vacation days.

Friday's Strategy Session was so quiet, we were practically able to crack the Morse-code-esque rattling during the interview with Verizon's Lowell McAdam.

McAdam, who had earpiece trouble the whole time, figured to be a good get, and seems like a well-spoken, reasonable guy who will be a capable CEO, but honestly, we barely understood maybe 1/3 of what he and David Faber were talking about, the gist of it being that Wall Street analysts apparently just don't get the new model of how great all the revenue opportunities are for Verizon products.

Faber at one point asked if there is pricing power in service plans. McAdam answered, "We just converted over to, uh, to tiered pricing, data-tiered pricing, because we see a huge wave of video coming," which, translated by our CEO/CEO-in-waiting Magic Decoder Ring, comes out to something like, "heavier users have been sticking it to us, so we're jacking fees on them hoping most won't flee and that we'll ultimately come out ahead."

Not only that, but also sounds like a Netflix trade.

Expert draws conclusions on Europe based on historical sample size of about 3

We always get a bit skeptical when people on CNBC critique the Great Depression.

On Friday's Strategy Session, it was guest Scott Minerd, a Europe watcher bemoaning all the measures being taken to ... gosh, what's the real end game here ... let's try: make Greece and the rest of the continent's "economy" just the way it was 4 years ago.

Guest co-host David Simon tossed the alley-oop pass, asking Minerd what Europe hopes to gain from the austerity measures.

Minerd complained that it's based on the late-'90s Asian crisis model, but that the Asian model involved dramatically depreciating currencies.

In Europe, Minerd said, they're combining austerity with ideas to, or realities of, "increase taxes ... cut spending ... strong currency," an outcome that we here call "Hooverism" — or "the same formula that caused the United States to go into depression."

It's bad enough that conservative guest after conservative guest comes on CNBC to gripe about how government policy isn't doing enough to help people, but it's ridiculous when it reaches the level of complaining that the federal government 80 years ago didn't do a better job of helping the grownups who were capable of helping themselves and proved it, from a time so far back in history as to be about as relevant today as Leif Garrett.

David Faber asked Minerd if the "6th time in 18 months" for a European bailout will be the last.

"Absolutely not," Minerd said, explaining it doesn't "address the structural problems in Greece," and that they'll be "revisiting this again sometime in the next 6 to 12 months."

Minerd said the bondholders are simply getting too much. "We really need about a, a 70, 75% haircut here, about; the bondholders should be getting about 30 cents on the dollar," he said.

Half of mortgage-takers
pick 15-year

TD Bank boss Ed Clark seems like exactly the type of guy you would actually want to deal with at your bank, so hopefully he means it when he says his branches provide "spectacular friendly service."

Clark, a refreshing guest actually, said 2 things of note, that half of the people they give mortgages to want 15-year instead of 30-year, and that "our mobile app users visit our branches or stores more often than people who don't have a mobile app."

He said that opening branches in the U.S. (he used both "branches" and "stores" several times to account for terminology differences between the U.S. and Canada apparently) and keeping them open longer than rivals, or 7 days a week, is a "basic business model that we know works," and allows his company to "take market share on a continuous basis."

Fair enough, but AOL dialup in homes was also a business model that smart people just knew works, and, well ... let's just say nothing's infallible.

David Simon expressed doubts about Medco based on the whole 3-player/4-player thing and UNH, saying, "I think there's probably a 30 to 50% chance that deal ever goes through." Simon also said, "I don't think there's anybody else out there for Clorox," and that the company will probably just give Icahn 3 seats and leave it at that.

[Thursday, July 21, 2011]

Just what the world needs:
9-year-olds playing the stock market

Ron Insana is a spectacularly underrated business pundit and this site is proud to be one of the few places that notices that and, as regularly as possible, notes Insana's propensity for insight and general quotability.

So we were thrilled to see Insana turn up on Thursday's Fast Money, when he revealed, "My 9-year-old son owns 2 shares of Apple," and moments later, "he owns Dell and has done reasonably well there."

Honestly, we can say with complete conviction that it might actually be worse to expose kids to the stock market than virtually any other habit, and that a 9-year-old with AAPL and DELL shares is likely a 9-year-old with either too much money and/or too much computer equipment.

But Insana didn't say anything about BAC, so the kid's off to a good start.

Based on colleagues’ reax, you’d think Jim Iuorio is the Hamilton Burger of options arguments

Jim Iuorio was given a healthy amount of time on Thursday's Fast Money to tout his Caterpillar volatility trade.

Too much time, as it turned out.

"I like buying the August 115/120 call spread," Iuorio said, explaining in several (i.e., too many) ways how the volatility works in his favor here and the usual Options Actions cliche, that if you buy the stock you're putting SOOOOOO much more money at risk but with options you do it cheaply and totally DEFINE your risk, but not really answering Melissa Lee's non-question about how the current state of volatility comes into play here or something like that.

Fair enough. Then Ron Insana complained slightly about the public perception of the VIX definition. Iuorio requested a moment to ask a question of Insana at the end of the segment. Mel Lee agreed but insisted it be quick. Iuorio wanted Insana to confirm that with a 15 or 16 VIX, "Don't you think the complacency has set in the market?"

Well, actually, Insana said that according to "longer-term studies," you could have a whole year where the VIX ranges from 9 to 15 or 9 to 17, "and we had a bull market on our hands."

John Paulson: Great guest
for SALT 2012

Ron Insana, who got to speak a little bit early on Thursday's Fast Money and then got shelved until summoned by Jim Iuorio, expressed some doubts about whatever the heck John Paulson's macro market view is here, saying that things Paulson appears to be doing that would be bearish aren't supported by the macro signals Insana sees, and thus, "It's a somewhat confusing play here."

But Keith McCullough, on the Fast Line, took the Paulson dis a new level, asserting, "This guy's gotta prove big-time that he's got the global macro risk-management process that is repeatable. I do not see that in him yet."

"He is not George Soros," McCullough added.

Karen Finerman asked McCullough a question that only a few people are fortunate enough to have to care about, whether Paulson's recent big years attracted a lot of new money that will bail on him more quickly than typical clients (we promise, if Metropolitan Capital ever gives us an account, we'll keep it open for years. A decade.).

"That's definitely the case Karen, as you know, I mean, the last money that comes in is the first money that, you know, in many cases go out," McCullough acknolwedged, saying it's the "johnny-come-lately money."

Melissa Lee showed a chart about 3 times of Paulson holdings and declines in holdings, and yet she kept showing it even though someone forgot to fill in the decline% for GLD and just left it "xx."

Which is more uninteresting conversation: MSFT, or just MS?

Viewers who managed to stay awake through the opening of Thursday's Fast Money got to hear about Microsoft's earnings call and whether Morgan Stanley is the new Goldman Sachs.

We decided a while ago we wouldn't report on Fast Money MSFT conversations anymore, but who knows, might as well get some people on the record.

Joe Terranova said, "I don't think there's enough here to really catapult the stock that much further," while Brian Kelly complained that, "for me valuation has to come with some kind of growth element."

Karen Finerman seized on that point and challenged why Kelly is saying there's no growth. Kelly didn't really answer but said he thinks it's not good that Google and others offer similar products to the Office suite for free.

Nevertheless, Finerman said, "I still feel the valuation is very compelling here."

Guy Adami said, "I don't see a lot of downside here from 26 and a half," but admitted he doesn't see a lot of upside either.

"I feel like we've heard this story again and again," Melissa Lee said, at the top of the program, and yet somehow continued to talk about that same story anyway.

‘Senator, you’re no ...’

Guy Adami engaged in a bit of banking elitism on Thursday's Fast Money, saying, "Morgan Stanley might have a better quarter than Goldman Sachs, but they are not Goldman Sachs."

But analyst Doug Sipkin argued, "Morgan Stanley has a better business model for the environment that we're in right now."

Michelle Caruso-Cabrera, whose name was spelled correctly this time in the graphic (on all 3 lines), albeit in all-caps which isn't policy, reported that there's going to be a partial restructuring of Greek private sector debt.

Guy Adami said he and Tim Seymour each keep a list of top 100 bands. "I thought your list was Marisa Tomei," interrupted Karen Finerman, but Adami protested, "that's a much different list."

Mel Lee had the outfit of the day, a flirty rounded-neckline black top topping off fuchsia skirt. Maria Bartiromo's white jacket with heavy gold trim on Closing Bell just prior to Fast Money seemed a bit like 1970s male prom wear, but we're not fashion experts around here.

Dan Niles actually says he’d be ‘inclined’ to go long Cisco

Notice you never see those Ellen Page Cisco ads anymore, you know, the ones that show kids in Canada and China both synching up in the daytime in each location when they're about a half-day apart, which makes you wonder if the original trio accomplished anything except to put a few more bucks in Ellen's pocket.

Superstar chip expert Dan Niles brought up CSCO on Thursday's Fast Money, saying it's time for a rotation in tech.

"Well I think to a great degree you're gonna start to see some rotation I think, out of some of the smaller tech names that people have assumed have been untouchable, as the economy slows down into some of the larger ones that people assume was company-specific," Niles told Melissa Lee, saying there was a little of that Thursday with CSCO.

Later, he said, "with Cisco, I'd be more inclined to take a long position there and maybe be short some of the other names that, you know, people have assumed are untouchable and deal with it that way"

Guy Adami asked Niles where INTC is going. Niles said Intel could've benefitted from the Japan tsunami in ways that won't be long-lasting, though chip buyers haven't "confessed" to that yet. "I think the Sepetmber quarter could be very interesting in that regard," he said.

Joe Terranova asked Niles where new capital should go in the tech sector. Niles said the Internet places for buying and selling — he mentioned GOOG and EBAY — are appealing because they can prosper if GDP is less than expected. "That's the one area where I feel increasingly good about," he said.

Guy Adami concluded by saying not that Niles spoke on Fast Money during the SALT Conference in Vegas, where Guy Adami could've visited Jack in the Box but didn't, but rather just a general shout-out, "If you don't listen to Dan Niles, I think you do at your own peril," before a very subtle dis, "I still think Cisco's got another wave to the downside" and trades to $14.50.

Steve Cortes is actually concerned governments might do things to make stocks go down

Steve Cortes explained to viewers of Thursday's Fast Money Halftime Report that the market is being whipsawed by government headlines, which he can't quantify, and thus it's best to stay lightly invested in the market, which he claimed tons of people are doing because of light volumes.

"There's a lot of headline risk in both directions," Cortes said.

And how many people out there — besides Steve Cortes — actually think that all these "governments" are going to produce agreements that negatively affect stock prices?

In fact — and we're just the amateurs here — if anything, every pending major government negotiation for the last few years has been a reason to buy.

The gut feeling here is that the torrid rally at the end of June — one of the most oddly resilient we've seen since Fast Money originated — signaled something, and it's not a short-term bear market.

Gotta admit, ‘asterisk-free’ is a clever name for a checking account

Huntington Bancshares chief Stephen Steinour probably didn't realize he was going to get something of a grilling from Judge Scott Wapner on Thursday's Fast Money Halftime Report.

Steinour was asked about "clarity" and boring stuff like that and said, "We're just being more cautious with our economic outlook than we had been."

Then he touted developments in checking. "Asterisk-free is our name, checking account product," Steinour told Wapner, who immediately challenged checking-accounts-as-growth agenda.

"Is that the right strategy to have now," Judge demanded.

"We believe it's absolutely the way" to profitability, Steinour said, when Judge was finished cutting him off.

Steve Cortes said "I added to my long position today" in MS.

Guy Adami for no reason he was willing to explain first spoke about how terrible the chart on FITB has been (not to mention how hard it is to pronounce the corporate name) but somehow said if it closes above a magic $13 level, it "all of a sudden looks extraordinarily interesting."

Citigroup: ‘Marquee’?

Steve Grasso said on Thursday's Halftime he never buys regional banks because "I'd rather trade around the marquee names."

Either way, you go on vacation, and chances are it’s still in the low $20s

Intel analyst Romit Shah quite frankly gave one of the most articulate bearish cases for a stock we've heard on Fast Money in a while, saying essentially he expects a "repeat of last summer" for Intel, because it appears to be overly bullish compared to others.

Shah also said, "Historically you don't wanna own Intel when they're increasing their capex investments, and this year, capex will be up almost 100% vs. 2010."

Steve Cortes actually likes the stock for its outperformance of peers. Shah had an answer for that too, saying, that big Q2 outperformance is actually a negative and not a positive going forward.

Shah made reasoned, well-thought-out arguments. He could be wrong, or could be right. It gives people something to think about either way.

Patty Edwards experienced a remarkably quiet day Thursday and perhaps will be back on Friday with a chance to head into the weekend on a more vocal note. Edwards said China will continue to drive oil prices, she still likes Philip Morris long-term, and "I'd be in Coke instead of Pepsi."

Steve Grasso said, "I never buy the airlines."

On oil, Steve Cortes said he's "looking to short it here" because he finds the Chinese PMI numbers "incredibly profound."

Cortes also said he's adding to his Exelon long (so he must not be concerned about any governmental-related headlines in the energy space).

Guy Adami’s ‘point of reference’ is always kind of a lukewarm recommendation

Steve Cortes delivered a trade update on Thursday's Fast Money Halftime Report.

"I'm making money on the Morgan Stanley one and I'm losing money so far on Goldman Sachs," Cortes said, insisting again that he only likes the investment banks because the other big banks are dogged by mortgages.

"If anything, I would look to be shorting Bank America (sic)," Cortes said.

Guy Adami said "I think the headwinds are still significant" for banks, but that Morgan Stanley helps put in a "point of reference," and overall, "I think you put in a tradeable low."

Adami also had a dis for an analyst, saying, "I thought it was fascinating that there was an RBC I think (sic) took Bank of America off their focus list, TODAY; thanks for nothing with that call."

Steve Grasso told Judge Scott Wapner that he was going to answer the question Judge asked Steve Cortes about whether there's a rising tide for all banks.

"The market's been doing that," said Grasso, who's in the banks Cortes dislikes.

But then Grasso offered a strategy that we really didn't "get," saying, "So for me I trade around my long positions. That's the key. You've gotta be trading around your long-term holds."

Patty Edwards was summoned only 3 minutes into Halftime Thursday and said Morgan Stanley clearly did well, and is more appealing than a lot of other banks, but it's not enough to meet her own criteria for buying it.

Thursday's activity suggests white-hot Joe Terranova's forecast Wednesday that bank expectations can't get lower is perhaps right-on.

We'll have more from the Halftime Report and 5 p.m. Fast Money this evening.

David Faber corrects
the New York Times

It's a good thing that the Obama campaign isn't asking big-time bundler Blair Effron to write its campaign jingles.

Like a stalling car, Effron took more pauses during his radically circumspect, notably generic commentary than any Strategy Session guest in recent memory, and by the time he was wrapping up his sentences, we were struggling to remember what the original questions were.

At least Effron did manage to say of the Medco deal, "It's going to take a long time, if it happens," and that, "if it doesn't go through, they will both be fine enough."

But mostly Effron spoke in the most halting, sweeping generics, and we don't mean the pharmacy space, saying macro business conditions are a concern as well as uncertainties and that corporations are being rewarded for bold moves. "I don't think that 1 deal marks a trend," he said, adding, "the idea that you would have as many acquirer stocks going up on an announcement is unusual. We wouldn't have seen this a few years ago."

For some reason Effron stared into the ceiling a couple times after Gary Kaminsky asked and pursued a good question, about how a banker sells a deal to companies, first objecting to Kaminsky's description of how a deal should start. "Most good transactions are actually driven by companies, not by bankers," Effron said, saying it would be the banker's job to explain whether the synergies are really there and whether the stock should be expected to rise on the deal.

Then Effron actually said, "We happen to be in an environment, where there is more uncertainty than ever."

David Faber cut in with notable disdain, "You know we hear that so often," saying Effron is a notable supporter of Obama, but "not a hedge fund manager, I might point out to the New York Times."

Faber was referring to an article a few days ago in the NYT that noted Effron is a bundler who raised more than $500,000, in this sentence, "They included the Hollywood mogul Jeffrey Katzenberg; two hedge fund managers, Orin Kramer and Blair Effron..."

As far as Medco, a fine company as far as we know but part of this laughable pharmacy benefits infrastructure that constantly combines and uncombines with each other the way some companies go private/go public/go private, David Faber said the deal was actually "initiated" by Medco.

Gary Kaminsky noted, "These PBMs have been sort of, uh, you know, married with everybody. Married, divorced. Married, divorced."

Faber said, "Antitrust remains the biggest risk for this deal," and there's a question as to whether it's "4 national players to 3, or is it 3 to 2."

Kate Kelly prefers a different question than the one Gary asks

The Strategy Session had serious problems Thursday with Kate Kelly's mike, which kept a damper on her neat orange-white combination.

Even after the mike was sort of restored, a bunch of background noise could be detected.

Kelly said, "I think this is the quarter that Morgan Stanley has been waiting for," and the crown jewel was more than $2 billion in fixed income trading as opposed to Goldman's $1.6 billion.

But Kelly conceded that the next quarter, those results could always change. "It's the nature of the business," she said.

Gary Kaminsky asked Kelly if there's any evidence yet that Goldman Sachs' "non-business issues" have actually yielded new business for Morgan Stanley investment banking.

Kelly called it a "great question," then said she thought Kaminsky was actually going to ask if those issues pertained to fixed income, then answered that question she thought Kaminsky was going to ask but didn't, saying David Viniar "weathered" that question the other day and insisted no, it hadn't hurt fixed income. Then Kelly sort of dodged the actual question by saying the traditional "ding" on GS is not the issues Kaminsky described but that GS puts its own business ahead of clients and that MS has competed against that.

Kaminsky said someone told him last night, "When you were a chief technology officer, you could never get fired by choosing IBM to do a services agreement for you." And that it used to be the same for CFOs and Goldman Sachs.

Peter Boockvar said "We have the Europeans creating a super-TARP," although there's no sign they're going to bail out Chrysler/Fiat yet. Boockvar said the deal in the works is more debt-transferrence than debt-extinguishment. Gary Kaminsky asked Boockvar why U.S. long-equity investors should care now. Boockvar insisted there's a "real-world economic impact" spreading to bigger European nations.

Kaminsky congratulated Boockvar on his all-black outfit, which got a rare smile out of Peter, and then Kaminsky said something about it's the type of garb for a nightclub, but it wasn't clear what nightclub he was talking about.

[Wednesday, July 20, 2011]

Grasso: LVS tends
to be a winner in August

Steve Grasso was given a small window of opportunity on Wednesday to deliver precisely the kind of observation that Fast Money should be all about.

Grasso said he's been looking for a reliable seasonal trade for August, and he found it in Las Vegas Sands.

He said the last 4 years, "you average about 20% to the upside in August," even factoring out the mega-jump in 2009.

He said other casinos have also done well in August, but that LVS is the only one to rise each year.

"I bought it today," Grasso said.

Inaccurate notes on guest’s trade irk Melissa Lee

Mark Sebastian at the CME might've been making his first Fast Money appearance (we're not totally sure), and in the future it would probably be a good idea for the Fast Money producers to compare notes with him before he goes on-air.

Sebastian described the VIX scene as "2 steps up, and then a point and a half back."

After a fairly lengthy and nonchalant summary that hit on an interesting point (VIX at roughly the same levels in 2 time periods where the S&P was at sharply different levels) that wasn't quite explored well enough, Melissa Lee cut to the chase and we don't mean JPMorgan.

"So you wanna be long volatility here, and you're choosing the VXX which is one of the ETF products or ETN products out there," Lee said.

"No no no no noooooooo," Sebastian said, rolling his eyes.

"What are you doing. What are you doing. What are you doing," Lee demanded, cutting off the sighing.

"I don't wanna be long volatility. I wanna use pops in volatility to get short," Sebastian said, taking too long to explain he merely wants to short the rips in the VXX.

Najarian: V possibly
to mid-$90s very quickly

Joe Terranova actually argued on Wednesday's Fast Money that for the big banks, "The expectations are so low, they can't go any lower," and thus it might be time to look at buying MS.

"Morgan's gotta figure out this Smith Barney acquisition," countered Pete Najarian.

But Steve Grasso took issue with Terranova's broader thesis. "You could say the same thing with housing," Grasso said, but before a full-fledged debate could occur, Grasso revealed he was merely playing devil's advocate with his own trade, explaining, "I actually bought more Bank of America yesterday."

Stephen Weiss said American Express lost a Continental account that is the type of thing that hurts the stock, and Pete Najarian said he considered V a better play than AXP anyway, saying he thinks it could land "somewhere into the 90s very quickly."

Fast Money gang reveals
their Apple (product) purchases

Steve Grasso said on Wednesday's Fast Money, "I have an iPad at home, but I'm not crazy about it."

Melissa Lee though chastised anyone who thinks computer-owning has to be mutually exclusive. "In reality is (sic), I have this laptop, I've got an iPad in the green room, I've got a MacBook at home," Lee said.

Stephen Weiss said he likes QCOM and thinks the stock was pulling back because a lot of johnny come latelys have recently gotten into the name, but also, "they're adjusting their accounting, favorably."

Guy Adami said FFIV is "interesting" if it gets around the 97/98 level.

Guy Adami revealed, "I have a large stain on my right breast ... eating a brownie ... now the shirt's ruined forever."

Still a ways to go
to catch MSFT

Fast Money for some reason forced its viewers to sit through probably 10 total minutes of Intel conversation Wednesday, which was highlighted by this exchange between Steve Grasso and Pete Najarian.

Grasso: "Every time it gets to 22 and a half, 23-"

Najarian: "Used to be 21 though!"

Grasso: "Fair point. Congratulations."

Joe Terranova declared "I think this is the end of the run for Intel," and Guy Adami rehashed the warmed-over margin peak=stock peak theory before Pete Najarian jumped to the stock's defense.

"I think 25's in the future," Najarian said.

Man, we remember the days when 25 was in the future. No stock market bubbles. 30 was old.

Those were the days.

Guest Patrick Wang told the Fast gang that he'd like Intel to further explain a key point. "I think all investors wanna know where this demand is coming from," he said, while the screen text spelled a word as "INTSTANT." (But maybe that's not as bad as misspelling Ken Griffin's name throughout the day in a graphic.)

Wang predicted of the stock, "I think it's down modestly tomorrow."

Debt ceiling is a summer treat for House GOP

Washington watcher Ed Mills told Melissa Lee on Wednesday's Fast Money that Republicans in the U.S. House have every reason to just push the debt problem to the absolute limit.

"After August 2nd, it's a political loser," he said.

Mills said energy, defense and publicly traded partnerships are well-positioned for a couple weeks of D.C. showdown, but that health care firms with a lot of Medicare/Medicaid reimbursement and for-profit education "have to sweat out these final 2 weeks."

Steve Grasso suggested that might be trying to fine-tune the broader market situation a bit too much. "I just think the market moves higher ... the market's moving back to 1,370 in the S&P," Grasso said. "Chase for performance is going to be on."

The 2 and 20
buys ambidexterity

Anthony Scaramucci caught the tail end of Wednesday's Fast Money to talk about a subject that seems to have greater interest on The Strategy Session: hedge fund inflows.

Scaramucci said that even though it's a risk-averse environment, "the numbers are unbelievable."

But he allowed that "most of the money though is going to the top managers," saying 14% of the space is controlling 86% of the assets.

Scaramucci said people are turning to hedge funds because of the increased volatility and continued uncertainty in the world, in part from the regulatory agencies, although given what we've read about John Kinnucan and others, we sort of figured that's an argument to not go near a hedge fund, but whatever.

Scaramucci said, "People think that they need the ambidexterity that a hedge fund manager has," and that's normally the place where David Faber steps up and says, "Yeah, but 2 and 20??!?!?," but no one on Fast Money has that type of hedge fund skepticism, perhaps because many of them are actually running hedge funds.

Grannies flip off Steve Cortes when he goes out on the street

Apparently we're not the only ones who notice Steve Cortes' more dubious calls.

"First of all I've had Apple wrong, and I'll tell you it doesn't make me popular when I talk bearishly on TV about Apple," Cortes explained to Judge Scott Wapner on Wednesday's Fast Money Halftime Report. "I go out on the street and I have old grandmas giving me the finger."

Judge Wapner was less interested in the unladylike grannies than in Cortes' place among the stock-picking crowd. "You're in a big minority, man. I don't know of many people had Apple wrong," Wapner said.

Cortes tried to shrug that off with a clearly unspecific loss number, "I said I would stop above 360 and I did last week" and thus took a "minimal loss."

Cortes downplayed any derivative plays such as QCOM, saying AAPL is the opposite of Hyman Roth by squeezing its partners for every dime.

Of course, Cortes also called LULU a possible short at $91 not too long ago, but he probably hasn't gotten mad, or ask who bought it, because it has nothing. To do. With business.

Zachary Karabell questioned, "How do you short Hyman Roth," then pointing out that Broadcom is a "binary" type of AAPL derivative play that could deliver hugely in either direction.

It’s the worst economy since the Great Depression, and they can’t keep iPads on the shelf

Jon Najarian was so proud of his great AAPL trade from last night's afterhours, he had to bring it up again on Wednesday's Fast Money Halftime Report.

"I was selling north of 400 last night; the stock is roughly 387-ish now. I think you do get a chance to buy it in the 380s again," he said.

Well, lessee ... we're not that good in math. But if it's presently trading 387-ish, then it stands to reason you can buy it in the 380s.

Najarian did recommend AMT, CCI and TESS as derivative plays.

Brian Kelly pounded the table for EMC and VMWare, which brought agreement from Zachary Karabell, who made the type of soundbite we hope gets played the next time Tim Seymour reads off a list of bad economic data.

"This tells you something about an aspect of the American consumer economy that is robust and strong and growing. So every time you hear this, 'Oh, consumers are saving and putting away their wallets,' really depends on which consumer, right," Karabell said.

"There are consumers with money to spend," he added.

Does anyone actually think defense spending will take a hit in Barack Obama’s debt compromise?

Judge Wapner got a slight interruption on Wednesday's Halftime Report from Phil LeBeau, who spoke with Boeing commercial aviation chief James Albaugh, after LeBeau had already talked with Airbus' Tom Enders on The Strategy Session, which makes it sorta seem like interviewing the Super Bowl champs' locker room first, and then the losing coach second.

Albaugh was mostly full of praise for American Airlines and for Airbus, saying this type of order "doesn't happen very often."

He made sure at least a couple times to "compliment Tom" and tried to stress that there couldn't be 1 winner for this order because neither had the capacity for the whole thing.

Brian Kelly, to his credit, saw through that, observing "that's the spin," and the reality is that Airbus has grabbed an account it didn't have, so "this really probably is better for Airbus."

Zachary Karabell said, "I wouldn't touch Boeing" because of its "huge defense component," and the gut feeling here is there are much better reasons for avoiding Boeing.

Steve Cortes likes ePal;
do with that what you like

Mark Mahaney unfortunately used the dreaded "tale of 2 cities" pun on eBay's quarter but said at a minimum, it should meet expectations, and "This should be a typical eBay quarter."

Hilariously, and we almost momentarily fell off the chair, the camera forced Jon Najarian to hold a pose for about 20 seconds while Mahaney spoke.

Steve Cortes likely avoiding getting the finger from auctioneering grannies, saying, "I think you get an Internet, kind of sexy tech company here at a very favorable multiple."

Judge Wapner was surprised. "I'm gonna mark this down, July 20th, at 12:48, Steve Cortes said he likes something," Wapner said.

Brian Kelly said he likes TOL for a couple reasons, one of them being useless pricing data that comes out and floats in the wind by the week, the other being that "50% of the distressed homes are now in the government's hands via Fannie and Freddie," and for whatever reason that's an "inflection" point for all of housing including high-end like Toll.

Dennis Gartman, before unleashing 4-year-old cliches on the Fast Line, said housing permits are far more important for copper than sales of existing homes, but he never said if yesterday's permit number is bullish.

Gartman said "China's probably worth 40 or 50% of what's going on in the base metals markets, generally ... we are no longer the big dog in the hunt," and if you haven't heard that in the last week month year> decade, you haven't been paying very close attention.

Gartman said the late-comers to gold need to be flushed out perhaps especially if there's a Gang of Six deal. "Gold's getting a bit toppy up here," Gartman said, then quoting Yogi Berra on crowded trades, added that he's "demonstrably less long."

But he told Brian Kelly in a repetitive question that $1,600 isn't the permanent top by any means. "I sound like a gold bug when I say that, and I'm not a gold bug," he added, saying it needs a "50-$100 correction."

Was Scott Sperling talking about Washington ... or the media?

Unfortunately, The Strategy Session on Wednesday forgot to hand out complimentary Scott Sperling Magic Decoder Rings for its viewers.

Sperling protested from the beginning that he couldn't say anything about Dunkin Donuts and that he'd have to "talk generically," and boy did he ever, on every subject that came up.

At one point when David Faber asked about what Sperling's seeing in the economy and admitting he asks Sperling that question every time, Sperling singled out the "animal spirits" as being "more than just a stock market issue," in a curious point suggesting that when people turn on the news to whatever their favorite channel is, CNBC, CNN, Fox, MSNBC, they're hit with bad news, and "I think that has an impact on the consumer."

That's a remarkable point actually, as it implies 1 of 2 things is true:

That our propensity to buy things is based on perception and not facts;

or the media is distorting the relevance of certain data to the detriment of society.

How the "animal spirits" fits in, we haven't figured out yet.

Gary Kaminsky tried a couple times to get Sperling to explain whether Thomas Lee has more leverage now with investment banks given that it's a big customer and these banks are scraping for work almost as badly as Charlie Sheen.

First Sperling said something like, "We're looking at the broad range of their capabilities within certain verticals," and after Kaminsky persisted, would only allow, "I think we continue to look at it as a real partnership with these players."

David Faber could contain himself no more, scoffing, "You never beat them up on price? Come on."

Later Kaminsky revealed a message from a Wall Street viewer assering, "Scott is being polite. They have plenty of leverage over us."

Who watches ‘Cheers’ anymore

Phil LeBeau on Wednesday's Strategy Session spoke with Airbus' Tom Enders, who was quite gracious in refusing a victory lap over the American Airlines order. "It's a win for Airbus, it's a win for American, it's even a win-win-win, it's even a win for Boeing as well," Enders said.

Gary Kaminsky said AAPL has so much cash, "They could buy Starbucks, take the entire company, take the thing private, own it, and make it accretive," but, "What U think they should do with the cash right now is take 45 to 50 billion of it and do a significant buyback ... major Dutch buyback here."

Kaminsky said the notion that "you must have some leadership in the financials to take the overall market higher" continues to be tested or will continue to be tested.

Guest Richard Repetto spoke about what turned into a very boring development among Ken Griffin and E-Trade, saying, "I think E-Trade you know is, is meant at some point to be sold," because in that space economies of scale matter, "customers go onto 1 platform."

Gary Kaminsky said there was a time when full-service firms were interested in the discount brokers, but not anymore. Repetto allowed that E-Trade still has "the deposit-gathering capability" that a buyer would want.

Repetto said this could get done, "we think somewhere, 18 to $21."

David Faber reported that CBS and Amazon have a deal to give Amazon access to "Cheers," but that Amazon pays "40% more per subscriber than rival Netflix," and we wonder what Tony Wible thinks about that.

[Tuesday, July 19, 2011]

Joe Terranova: on fire

Few have successfully pounded the table so often in such a short time as Joe Terranova has with AAPL.

On July 5, a day the stock closed at $349.43, Terranova said, "I stand by my 413 call for Apple; I think Apple in the second half of this year goes above 400."

That was just the start of a monster July, in which Terranova has been touting the shares all the time while several of his colleagues tended to be a bit skeptical.

Most impressively, Terranova was the only one of 5 Fast Money panelists back in November to put AAPL over $400 at Thanksgiving 2011, which sets him apart from several others who have recently made good bullish calls in the name.

"I say you buy more Apple; you don't sell," Terranova said Tuesday.

Dan Nathan: Fast Money doing disservice to viewers by recommending buy AAPL now

This page makes a career out of evaluating things seen and heard on Fast Money, and so it would be quite the oversight not to review certain opinions expressed here.

July 7, this page said, "there's maybe a greater chance of NFLX catching AAPL in a hurry than people might think."

We still think it will happen, but maybe not in quite the "hurry" we once did.

Over the July 4 weekend, this page also speculated that Patty Edwards had the best Thanksgiving 12-month call on AAPL, at $375, because Joe Terranova's $413 "just feels out of reach."

Edwards' call still seems pretty good, but Terranova's undeniably in the driver's seat now.

Fortunately, we don't have to be the goat, as Guy Adami took care of that with several days of $285 predictions recently (wonder if viewers send him hate e-mail even when the stock goes up), and of course, there's always Steve Cortes, who claimed mid-June (price $332) that "The law of large numbers is starting to take effect on Apple" (and also said LULU's high-priced apparel era is over with stock at $91, that MS was a "bargain" at $22, that GS was a bargain under $140, and "I think the double-dip is already here in reality").

(We actually do root for Steve Cortes' stock picks to succeed, but sometimes, it's kinda like rooting for the Chicago Cubs.)

Anyway, Guy Adami and Steve Cortes have competition for worst Apple skeptic from Dan Nathan, who way back in October was claiming Steve Jobs has "lost it," and in the last month insisted the cloud wasn't going to be good for Apple because he knows a lot of "smart people" who have lost their calendars when uploading them on AAPL devices.

Tuesday, Nathan said he found Joe Terranova's keep-buying recommendation faulty. "I think you're crazy," Nathan said.

"The stock's going to a million; we all know it," Nathan said, arguing, "Android's activating 500 million phones a year here ... this is not a layup here people."

Terranova calmly responded, "This is a layup, this is an easy trade."

Nathan couldn't stop talking about what a bad idea that was, saying, "You could see some profit-taking tomorrow," then, insisting later in the program, "I don't think we do anybody at home, uh, any service by just saying run out and buy it on the opening."

Dr. J tells viewers
he sold at AAPL highs

We knew as soon as Mel Lee brought Jon Najarian on Tuesday to discuss up-to-the-moment trading in AAPL, we'd get a Brag Trade.

And we weren't disappointed.

"I know what I've done already, and that is, I've sold some stock over 400," Najarian explained, even though Lee had only asked him what the "short-term trading call" is.

Mike Khouw implied that whoever bought Dr. J's shares was a moron. "You absolutely have a chance to buy this stock below $400 so I wouldn't rush out and pay over that," Khouw said.

Khouw said the stock is great, but pointed to the large-numbers thing; "they cannot grow infinitely."

Karen Finerman, in impressive dark olive top although not quite in the same league as yesterday's ensemble, grumbled about the "$76 billion cash hoard ... that's absurd, it's a terrible use of capital."

Gosh durn those bad money managers at APPL, think how much that stock should really be worth.

Finerman, always looking for the possible short in any situation, said, "I actually think that this is very problematic for RIMM," and that maybe she'd play that with RIMM puts.

Stephen Weiss said "Qualcomm is a great derivative play here."

Colin Gillis was overcaffeinated as usual, suggesting AAPL is winning not only on Wall Street but in the courts. "We could have an import ban on Android phones! It's not an impossibility," Gillis said."

Joe Terranova stood firm behind his Thanksgiving prediction. "By December 1st the stock is well above 400 bucks."

Any chance we’re gonna kick the can down the road?

Thankfully Fast Money managed to bring aboard Dan Greenhaus for some non-AAPL talk in what amounted to an hourlong Apple commercial + Dan Nathan.

Greenhaus said the debt deal that's headed our way is "3 and 3-quarters ... they're gonna phase out the AMT, they're gonna reduce income taxes, uh, they're gonna reduce the corporate tax rate." All of which, he said, are things that look "incredibly, incredibly bullish" for the market down the road.

Honestly, we must've missed something in his commentary, because it actually sounded like he was saying a Democratic president and Senate are about to agree to sweeping tax cuts that will take nearly $4 trillion off the national debt.

Addressing one of Karen Finerman's most favorite recent subjects, Greenhaus asserted that indeed, Treasurys would still be the "safe haven" if there's no deal; it would be "incredibly bullish for Treasurys."

Stephen Weiss said, "I could (sic) care less about Yahoo," and instead hailed EMC; "to me that's one of the best cloud plays out there." He made BTU his Final Trade.

Karen Finerman said "I like QEP" for her Final Trade. She also oddly suggested that Jon Fortt was at the "Field of Dreams."

Who’s hotter: Wendi Deng,
or Rebekah Brooks?

We're not convinced that Americans really care a whole lot about the Murdoch empire.

But nearly all of them who watched the proceedings Tuesday were getting their first load of:

Rupert's 42-year-old wife,

and Rebekah Brooks' hair.

Now, how that exactly factors into the here and now, we admit we can't really defend.

Deng is a striking beauty who could play herself in a movie and not give an inch to her co-stars. We heard from an exceptional Hollywood source (yeah, people like Karen Finerman probably shrug about Hollywood gossip, but we always get excited at a reliable scoop), a discerning sort, who once spoke with Deng at an event and said she is "very impressive" in person, with an emphasis on "very." This is someone you definitely want to accompany you to a Parliament hearing.

Brooks is not as pretty, but we're big fans of hair around here (sometimes confused with fans of big hair), and that is as staggeringly gorgeous of a red top as you'll ever find.

Melissa Lee, who co-anchored the CNBC coverage during The Strategy Session time slot, seemed to have the hots for James Murdoch, telling a guest he was "apparently capably answering questions," and, "this seems like a, a succession plan in the making."

Murdochs preempt Strategy

The Murdoch hearing is eating up most or all of The Strategy Session time Tuesday; this page will check in later with Fast Money and other s--- (Chris Whalen's term, not ours).

Chris Whalen says ‘s---’
on Fast Money

The FCC might want to start thinking about initiating a 7-second delay on Fast Money, and not just for bleeping Steve Cortes' most dubious trades.

A couple weeks ago it was Pete Najarian after being annoyed by Judge Wapner. On Monday, Chris Whalen, a guest on the Fast Line no less, told viewers, "There was a point in time where Lloyd Blankfein could've stepped off and said, 'Look, I took the shit,' pardon my French, 'it's time for new leadership to move the firm forward,' but they didn't do it."

Melissa Lee, who wouldn't let Charles Gasparino make a political point but didn't interrupt a guest using a 4-letter word, merely let Whalen continue before ending the dialogue on a Bank of America note.

Wonder who will be the first to use the F word.

Karen Finerman:
A CEO’s best friend

Karen Finerman, in an insanely lovely black/white ensemble on Monday's Fast Money, somehow found herself giving a vote of confidence to not 1 but 2 CEOs of bloated companies whose glory days are in the rear-view mirror.

First up was Cisco's John Chambers.

"It's unclear to me that he's the problem. I don't sense that he is, so I would think he's got a long time," Finerman said.

Later, it was Sallie Krawcheck's boss.

Melissa Lee asked Finerman, for the 2nd time in 2 weeks (under the guise this time of, "now that it's had a string of 52-week lows"), "If Brian Moynihan were out, would that be a catalyst for BAC."

"Not to me, that wouldn't be; there are other things that I think would be much more (inaudible)," Finerman said.

Brian Kelly puts Tim Geithner interview on list of things that could derail the recovery

Melissa Lee on Monday's Fast Money played a clip of the Tim Geithner interview in which he complained about banking goals being out of whack with Main Street goals or something like that.

"Sounds like he's a little bit anti-bank," Lee observed, and she didn't mean David.

"You think?" asked Brian Kelly.

"Really?" said Karen Finerman.

Kelly concluded, "It is a huge, huge policy error to do this. It's on my list now of things that could derail the, the, uh, recovery ... I sold Wells Fargo today."

Finerman allowed, "I was pretty surprised at that rhetoric," then made half of a point she's been ahead of the curve on, saying, "banks want to make loans."

Joe Terranova got the other half of that point wrong, saying, "They're not lending because they're rebuilding their balance sheet," when in fact the reason they're not lending is because there simply isn't 2007-level demand and won't be for years.

Terranova, straight-up as ever, said, "I'm long Goldman Sachs, I'm stuck in a bad trade."

Chris Whalen, the guy who said the bad word, said don't look to the big banks for stock gains in the financial sector. "You wanna buy quality, you gotta go down in size," he said, and we think that means he thinks the big banks are "s---."

How about SALT II
in November?

This SALT Conference that everyone on Fast Money talks about sounds like so much fun, they oughta try it twice a year.

Monday, the gang was discussing WYNN and LVS — see, longtime Fast Money viewers know that, with the exception of Research in Motion, basically all the stocks they recommended in the show's initial days are the same stocks they recommend now — when Brian Kelly suggested Guy Adami could report on Vegas' table results firsthand given his time at SALT in May.

Oh, "upset that we didn't bring you along with us?" Adami asked Kelly, before asserting that actually, "I didn't play."

But Melissa Lee and Karen Finerman chimed in together, "You tried."

Guy Adami might or might not have gambled in Las Vegas, but it's clear that Guy Adami definitely did not go to Jack in the Box in Las Vegas, which is too bad, because Guy Adami occasionally recommends Jack in the Box and then protests he doesn't know what they do.

Adami offered to go to Vegas with Kelly, which Mel Lee called a "man-date in the making," only to have Lee plead, "Can you guys take me with you?"

Adami, somehow, incredibly, said no, prompting Lee and Finerman to decide they'll take a road trip to Vegas together at an "undisclosed time. Undisclosed location."

Fair enough, but sources tell us that while Karen and Melissa constantly turned heads at SALT, usually they were only seen with phone glued to ear.

Tilson: News Corp. no buy here

Whitney Tilson, who came up huge last year with BP and earned the CNBCfix.com Fast Money Trade of the Year for 2010, was asked by Melissa Lee Monday if News Corp right now is the same kind of opportunity.

Evidently, no.

"It's not even close to being cheap enough," said Tilson, saying NWSA is down 17%, whereas BP about a year ago was down more than 50%.

Tilson said some value managers have picked through the parts of the company and found a valuation at twice the current stock levels, but that there's nothing like a cap-the-well solution in sight for these problems.

"Forced to choose right now frankly, uh, I think it's a better short than a long," Tilson said, though he admitted the stock has traditionally suffered from a "very big Murdoch discount."

Adam Parker says something no one could possibly believe

Morgan Stanley equity strategist Adam Parker told Melissa Lee in the studio Monday that "our year-end target for the S&P is 1,238."

But that wasn't the unbelievable part, which came a moment later when Lee asked if he's the most bearish analyst on the Street.

"I'm not sure, I don't really read the other guys' research to be honest with ya," Parker said.

Yeah, right. Sure.

He's undoubtedly just as big a fan of David Rosenberg as the rest of us.

Rarely does Fast Money land a GS/MS strategist, so Parker's appearance was either something of a coup, or a sign the banks are so desperate, they're even trying charm offensives.

IBM was praised in probably 4 or 5 different segments of Monday's Fast Money. Guy Adami said, "I think this stock is headed towards $200."

Adami: LNKD gives viewers every reason to think ‘game is rigged’

Melissa Lee on Monday's Fast Money showed the same LNKD/NFLX chart that Judge Wapner showed at Halftime (you know, the one that showed NFLX with 4,000 billions in revenue in 2012 which more than makes up for Len Brecken's high-content-cost argument) and pointed out that JPM used that as the basis for downgrading LNKD, which is sort of unusual given that JPM is an underwriter of LNKD.

Karen Finerman said the math didn't add up. "Somewhere in that same note, they talked about $85 of fair value, which really begs the question of why did they offer it, why did it come out at 45," Finerman said.

Guy Adami said the retail investor has a right to think this is a lot s--- (Chris Whalen's terminology). "When they see something like that they have every reason to believe the game is rigged against them," Adami said.

Kelly: Silver going
north of $50

Brian Kelly said the coast is clear once again for silver (and he couldn't resist a Hunt brothers reference, which is what all silver players always say to sound smart), and "I think we go north of $50 here."

Joe Terranova said that for AAPL, "I think it's a breakout," as the price seemingly sets him up as the likely winner of Simon Hobbs' predict-AAPL-in-12-months contest from last November.

Karen Finerman was a little more cautious on AAPL, saying, "I'm still long, I'm not selling it here," and noting that analysts are tripping over each other to raise price targets, and "that makes the bar that much higher."

Brian Kelly described Cisco's 6,500 cuts this way: "This is kinda like austerity, right."

Amelia Bourdeau, our favorite Money in Motion trader with all due respect to Andrew Busch, recommends shorting Aussie/Swiss; "this is a risk-off trade."

Analyst actually rates NFLX
‘sector perform’

Andy Hargreaves on Monday made one of the most curious Netflix calls yet.

"Sector perform" from "outperform."

What exactly is the Netflix "sector"?

Blockbuster?

Hargreaves disagreed with Judge Scott Wapner's characterization on Monday's Fast Money Halftime Report that it's "priced for perfection," but Hargreaves allowed it's "certainly priced for, uh, a very very very strong performance."

But actually, reading between the lines like we always try to do, it sounded like if anything, Hargreaves was making 2 arguments for buying the stock that outweigh any paper valuation weekly guessing game. (This writer has no position in NFLX.)

"They're paying a lot for content because they can, and it becomes a barrier to entry for them, so in a lot of ways I think that that's a good thing," Hargreaves said.

Later, he said, "There just aren't that many good alternatives that are convenient and, and as cheap as Netflix."

Steve Grasso said, "I think there still is a lot of room for growth" in the company. Stephen Weiss said, "I would not get in here, on long or short side," and Patty Edwards concurred with that; "I wouldn't be long or short it at this point." Pete Najarian said he'd wait for a "significant pullback."

Judge Wapner at one point asked Hargreaves if this dubious call is merely an "incremental way" of taking a longer-term negative view toward the stock.

"Uh, well, not sure what you mean," Hargreaves said.

Edwards has ‘heard some things about the iPhone 5 overheating’

Fast Money Halftime analysts Monday were back to gushing about AAPL, which means Steve Cortes and Guy Adami weren't on the show.

Steve Grasso said something about the vertical integration ecosystem or whatever, and Pete Najarian said, "I still hold it, I think it's goin' higher."

But it was Patty Edwards who offered a scoop.

"I've heard some things about the iPhone 5 overheating, for example," Edwards told Scott Judge Wapner.

"Would I buy it today, given this run? I don't think so," Edwards said.

Stephen Weiss said he added to Qualcomm.

Claim that silver is industrial metal runs into curious mockery

Judge Scott Wapner, who in barely a 22-minute program was chock-full of dubious assessments, opened Monday's Fast Money Halftime Report declaring of silver, "Everyone said it was a bubble."

Patty Edwards said she owns it and made the non-safe-haven argument.

"It is an industrial metal and we are seeing some fairly decent numbers out of the emerging markets in terms of their industrial production," Edwards said.

For whatever reason, Pete Najarian started rolling over with laughter, and Judge Wapner sort of joined him, prompting Patty to request, "Work with me."

Judge tried to make amends, saying the mocking was "unintentionally so, Patty, love ya," prompting smiles from Patty.

(Gosh, they can roar about silver assessments, but imagine if they had brought up John Denver, they would've been raked over the coals and we don't mean the retailer that begins with a K.)

"I do think silver goes higher," Edwards said. "I am long silver this level; I'm also long platinum though because it's a play on, on the auto sales."

Najarian said silver options have been been hopping. But Steve Grasso said there's "a lot of headwinds around these price levels." Stephen Weiss said people are merely looking for a "mattress," and that he added "slightly" to a "small" UGL position.

Pete Najarian pointed to gold miners; "some of these miners are paying a dividend."

Scaramucci:
GS ‘very very cheap’

Anthony Scaramucci said on Monday's Fast Money Halftime Report that if you buy GS, you're bound to make money eventually.

"There's a very famous partner at Goldman, his name is Dick 'Richard' Menschel, he once said to me 25 years ago, if you buy Goldman Sachs at 1 times book and you sell Goldman Sachs at 2 times book, uh, and you do that for the rest of your life, you'll make a fortune," Scaramucci said.

"I think it's very very cheap," he continued, citing its roughly 1x-book valuation and "very bad PR experience ... you guys can put me on Fast Fire in 3 or 6 months if this stock has not rallied."

"The show's called Fast Money for a reason; this is a slower-money idea," Scaramucci conceded, and then, discussing his television approach, notably avoided John Denver when declaring, "But you see I like talking fast, Scott, so that I can, I can get all my points in without Patty having beat me up at all."

Pete Najarian said he'll get interested in GS when he starts seeing the insiders who sold at $165 start getting into it.

That’s why NFLX shares
are so high

Judge Scott Wapner introduced a LNKD segment on Monday's Fast Money Halftime Report with a comparison to NFLX's market value, EBITDA and revenues.

It was notable that the Fast Money graphics gang listed Netflix's 2012 revenue as "4390B."

And that's a lot of billions.

Patty Edwards dissed LNKD like a Calypso, saying, "All the times I've been on there, I've never actually seen any of the advertisements they say they have ... I don't think there's any reason to, uh, be anywhere near this frankly."

Pete Najarian reported "huge open interest" to the upside on MGM.

Stephen Weiss dissed WebMD. "It's a sick stock; they lowered guidance," he said, as Pete Najarian laughed though not as much as he did about the industrial-silver thing. "I'm surprised the company's been around for as long as it is (sic)," Weiss said.

Patty Edwards cracked about CLX, "I guess we use this to clean up with," saying Icahn is "bidding 76.50; no one's believing it."

Grasso mulling new buy of BAC

Steve Grasso, who had a notably quiet performance Monday, said on the Fast Money Halftime Report that BAC looks "long-term oversold at these levels."

"I'm long the name, I'm thinking about adding to it today," Grasso said.

Stephen Weiss said to buy JPM, not BAC.

Judge Wapner then asked Patty Edwards, "You see anything constructive here or what?"

That brought more laughs, and Judge clarified, "Not with the show, but with Bank of America."

Edwards said, "I didn't like these things 6 months ago I certainly don't like them 37% lower still. I continue to believe in that greater cockroach theory." She mentioned BMO again.

In case C’s share performance wasn’t enough of a clue

Guest Doug Sipkin said on Monday's Strategy Session that Congress blew it.

Not now, but around a decade ago.

"I actually think from a big-picture standpoint, um, I think it's pretty clear that repealing Glass-Steagall was a mistake," Sipkin told Gary Kaminsky and David Faber.

Sipkin said shorts aren't the problem for BAC. "I actually think it's, it's the long-only guys now coming out of the stocks. They can't deal with the pain," he said.

Gary Kaminsky said typcial valuation models aren't working right at this moment for BAC, saying it's too late in the year for a lot of money managers to take a flier simply on valuation. "To just think that it's cheap based on sum of the parts, that doesn't work," Kaminsky said.

He said the quarterly bank results are "not really that important," but the issue is, "what's the agenda here." He said BAC's type of performance will force a lot of money managers to decide, "Yeah these things are cheap, but I can't take the pain anymore."

Expert: Nat gas will remain ‘chronically oversupplied’

Energy investor/expert Rob Raymond, one of the best of The Strategy Session stable, said the BHP-Petrohawk deal (if you can't get the potash, you might as well buy some fracking) shows the "next generation of hydrocarbon production in the U.S. is unconventional in nature."

He said the integrateds are growing not by drilling more, because they're slowly running out, but by buying other assets.

He said "ultimately Williams ends up winning the deal" for Southern Union over Energy Transfer.

And, he concluded that nat gas, as in his previous call, will remain "chronically oversupplied." (But what happens if the government enacts an energy policy and adopts the Pickens plan and ...)

Scott Coyler touted BDCs as a good place for yield because they represent "middle market company financing ... publicly traded ... high current income ... potential of growth." He likes Ares Capital (ARCC).

Gary Kaminsky and David Faber noted the Barclays share debacle; Kaminsky said employees at banks like Barclays tend to get a lot of compensation in stock.

And remember when Barack Obama was "outraged" when he "learned" of those AIG bonuses?

John Kasich equates lack
of debt-ceiling deal to NFL allowing ‘thugs’ to play on Sunday

We watched Meet the Press on Sunday because David Faber was there to represent The Strategy Session, and yet it turned out to be Ohio Gov. John Kasich with the soundbite of the day.

"I don't think we just have a crisis in Washington of leadership, I think it's across all the sectors. I think we see it in sports, where we let, uh, sometimes these thugs go out on the field and play on Sunday because they can score a touchdown; we see it in our pop culture," Kasich said.

Let's repeat that one: "A crisis of leadership ... in pop culture."

Did Moody's put Charlie Sheen under review too?

Diane Swonk, the very pretty economist from Mesirow Financial, made 1 good point (according to her, Scandinavia had debt issues in the early '90s and did everything right in terms of negotiations but it didn't help the long-term jobless rates there) and 1 dubious point (once we eliminate all the tax loopholes we'll have a tax/jobs policy that sets us free).

David Faber, basically the most realistic of the panel and the one who came across the best (but keep in mind, he was the only trained TV host of the group), said first that the Murdoch scandal isn't a big deal here yet unless it envelops News Corp., then spoke about job-creation.

"The fact is that during the Bush presidency we had the lowest job-creation numbers we ever had, annually, about 3 million total jobs over those 8 years," Faber said. "The question really is, has there been a seminal change in the ability of the U.S. economy to create jobs."

Notice he cited "economy" as the creator, a bit dubious but not as bad as what other people said, as even conservatives continue to think that government is or should be some kind of factor in whether a person goes to work.

Tim Russert was an excellent journalist and continues to be missed. David Gregory's version of Meet the Press is not particularly different, but feels sharper.

Melissa apparently gets new glam photo at CNBC.com

Not too long ago, we happened to look up Melissa Lee's bio at CNBC.com, for reasons we can't recall.

Over the weekend, we looked it up again, only to discover the picture now is decidedly different.

We don't actually recall what was up there previously, except that it was probably the "bring it on" pose so commonly seen across the Web. Whatever it was, the present one is clearly something new.

So evidently Mel had an appointment with the official CNBC photographer in the wake of landing the Squawk on the Street post. She looks great, and the new pic even takes a few years off. (See, when people are younger, they want to look formal and professional, and then little by little, they just want to look younger.)

(Curiously, the text on Melissa's bio hasn't yet been updated to reflect the Squawk on the Street gig.)

Local journalism: Patty
quoted in weekly newspaper

We always get excited whenever we find the Fast Money gang quoted in local media, partly because we always are interested in how the individual is described, but also because it's another indication of the vast reach of CNBC.

(Sure, it's impressive that Dr. J and Rich Ilczyszyn are Reuters and Dow Jones Newswires mainstays, but those are always 1-hit wonders.)

The weekly Issaquah Press of Washington reported this week that Port Blakely Communities wants to build a shopping center in the Issaquah Highlands.

Now, you might be inclined to think — and the lede of the article suggests as much — that there could be NIMBY issues here.

But in fact, by the end of this 1,160-word article — quite long for a development story — it's entirely unclear whether there actually are any NIMBY issues or not.

Evidently, the "grumbling" referenced in the lede stems from big plans for this parcel never coming to fruition.

You have to get to the very end to find any resident/city council reax, and it's basically cautiously optimistic.

The whole thing is the classic story without an angle.

Patty, described as a "frequent CNBC 'Fast Money' contributor," emerges near the middle of the article, after the ubiquitous Craig Johnson, and suggests reasons why a new shopping center, perhaps with an Old Navy, could work, and why it might not happen. "A lot of people would say, ‘Well, you’ve got stuff that’s so close. You’ve got a Fred Meyer, a Best Buy, a QFC, a Safeway. You’ve got Gilman Village. You’ve got all of the restaurants down on Gilman and around. You’ve got a PCC. You’ve got two sporting goods stores. What more do you need?’” Edwards tells the writer.

Edwards also said, “Whatever it is that goes in there, it’s not going to be too high of a price point, because of the fact that it is a lot of younger families. It’s got to have the kid’s clothes, and if it’s got stuff for mom or dad, great, but that’s going to be an add-on.”

This site promotes local newspapers as much as possible, and we wouldn't want to rankle the writer, but this article needs a redo. Not bad material, just not very well-organized. Undersourced, and too many unnecessary words and passages. The lede should probably say someone's got yet another idea for a highlands mall, and here's why (pick an angle) it will happen this time, won't happen again, or what it needs to do in order to finally happen.

We get the impression the residents are fine with it; the problem evidently is getting merchants to commit to locating at the site so they can actually break ground.

"Neighborhood" is redundant in the lede, and we're not sure "lurched" is the correct term. In the 2nd paragraph, "as early as next year" is filler.

The 2nd paragraph begins, "If the deal is completed, as executives hope ..."

Would they really announce a deal they hope does not happen?

However it turns out, Edwards deserves some props for giving so much material to a local writer, and the writer deserves credit for seeking and landing some big-time retail commentary. (Now if he had gotten Meredith Whitney to assess Issaquah's credit rating, that would've been a major coup.)

[Friday, July 15, 2011]

Company’s shares hit same
price as 4 months ago

The Fast Money Halftime gang was basically gushing about GOOG on Friday, with Brian Kelly suggesting it's bad news for MSFT next week.

Patty Edwards seconded that, saying, "I was totally wrong on this along with a lot of Wall Street. These guys have absolutely gotten it right ... this is not good news for Microsoft next week, or in the future frankly."

Pete Najarian defended MSFT, saying, "I still think there's plenty of upside."

Analyst Ken Sena very modestly accepted congrats for promoting GOOG last week, saying his call was based on the "traction" of local and Google+, and the "overall health of search" that had maybe been downplayed by too many investors.

The curious thing to us is, we noticed that GOOG touched $600 Friday, which means that after a monstrous gain, it's basically only up to its intraday high of $603.69 on March 7, the last day it crossed $600.

MSFT, by contrast, is in the high $26s today, above its $26.27 on March 7.

AAPL is roughly even today with its $361.67 from March 7.

AMZN is far north now of its $172.09 on March 7.

BIDU is well ahead today of its $123.23 high on March 7.

(Facebook has probably tripled in the private market in the last 2 weeks.)

So basically, glorious results and a rosy reaffirmation of search have catapulted the company to a higher level of underperformance against its typical big-tech comparisons.

This one feels like a fade.

Larry Page: Mr. Nice Guy

Occasionally there's a suspicion among media observers that people and things sometimes tend to be judged less on hard facts than on how well they get along with the judgers.

For example, and this is a fictitious example, you could have a couple ballplayers hitting .220, one of them spending 15 minutes after the game talking to sportswriters and the other granting no interviews, and the former will generally be described as "fighting through the slump" while the other might be labeled a "bad free agent acquisition" who needs to go.

Or, put another way, we've long questioned if the tone of Goldman Sachs coverage might change a bit for the better if they merely invited Gasparino, Kate Kelly, Rachel Beck and Gretchen Morgenson over for a warm chat from time to time.

So we wonder, then, how the analyst outlook on GOOG and CEO Larry Page might change given that, according to Jon Najarian on Friday's Fast Money Halftime Report, "The analysts love that he stuck around and actually talked to 'em like a human being, rather than cuttin' 'em off and so forth."

Najarian even called Page "the opposite of Jerry Yang."

Somehow, we suspect Google forecasts will be getting rosier, one way or another.

‘Perfectly legitimate’ for TARP bank to report gains from moving money from ‘one pocket to another’

Judge Scott Wapner was impressively aggressive on Friday's Fast Money Halftime Report when questioning David Hilder about whether Citi's results were "low-quality."

"I would agree with that," said Hilder, saying part of the gains were in a loan-loss adjustment that when factored out, makes the earnings "way below expectations."

"What you're saying is they were essentially moving money from one pocket to another," Judge said.

Yes, but that's "perfectly legitimate," Hilder said.

Hilder said he thinks Wells Fargo will have a "good quarter" but only because of favorable conditions across the board, but he said there are indications Goldman Sachs has maybe had "difficulties in commodities trading" and that the results of 1 bank can't be applied to all others.

Panel actually plowing into INTC

Pete Najarian said on Friday's Halftime that the options market is suggesting "perhaps there may be" competing bids for CLX in the wake of Carl Icahn's offensive.

Even so, the Fast Money Halftime gang didn't seem blown away by Icahn's pitch. "I don't know that I'd be paying this much for it," said Patty Edwards, with the type of expression that sort of seemed to question where Carl came up with this one.

Surprisingly, though, a bunch of the panel jumped on the Intel bandwagon, with Brian Kelly saying it's his favorite from a list of biggies next week, and Patty Edwards saying if she had new money to put in, "I would actually be buying Intel also" because it has the least exposure to Europe of some of the others.

Dr. J went along with that sentiment, but brother Pete pounded the table for MCD, pointing to YUM's China results and insisting, "This is an animal."

The panel gave kudos to Guy Adami and Stephen Weiss for talking recently about Petrohawk (maybe that's one BHP can actually buy). Judge Wapner asked Brian Kelly, who promoted CLNE, if natural gas companies with shale plays are the only ones working. "As long as you have assets in the natural gas area," it doesn't have to be shale, Kelly said.

Dr. showed up in an Aeropostale golf shirt at the Nasdaq and once again got the Dr. Evil title, but no music. He said VZ is worth watching because of people on the sidelines waiting for iPhone 5.

Patty Edwards got Valmont (which is into light poles and irrigation) in Pops & Drops and noted, "This is a play on the farmers having a lot of money."

Willie Williams, same name as the Steelers CB who saved the 1995 AFC Championship Game against the Colts, which they really shouldn't have won anyway and then wouldn't have had to lose the Super Bowl, did the Money in Motion trade and said of Europe, "I think the stress tests were actually more of a distraction," and as for the euro, "I think on the top side I'd be seller again around 142, 142.50."

His trade, though, was, "I like selling Aussie/yen."

Pete Najarian said in Call the Close that he would "agree with everybody else" that the market would trickle lower Friday, even though Patty Edwards never said that but merely recommended "long Qualcomm before next week's earnings."

Doug Kass exiting CLX after Icahn’s Strategy Session comments

Doug Kass revealed via Twitter Friday afternoon that he thinks Carl Icahn didn't make a particularly good case for instant riches in CLX.

Kass tweeted, "After listening to icahn on strategy session i am exiting clorox... it will be a lengthy process/end game. NEXT!!"

Icahn: ‘I really think there’ll be competing offers for this’

The Strategy Session got a 5-minute head start Friday to deal with the (Zzzzzzz) European bank stress tests, but things actually got interesting in the latter 1/3 when Carl Icahn put in a call.

David Faber instantly hinted at skepticism that Icahn wants anything more than to jack up the price of Clorox short term, introducing the segment as, "He wants to own it all — at least he says he does."

Icahn insisted, "I think Clorox is just very undervalued," then noted that he heard Faber say, "so he says," complaining, "I know you're great at those subtleties."

Icahn went on a mild charm offensive, explaining he's spoken with Don Knauss and that Knauss is "very sincere" about maximizing shareholder value, and that Icahn is not just saying that "facetiously."

But Faber asked if Knauss has a different view of what's best for the shareholders.

"You'd have to ask him," Icahn said.

Faber asked if Icahn actually bid too low. Icahn said it's a bid, and people can vote on it. "I really think there'll be competing offers for this," he said. (Yeah, but BHP Billiton is already preoccupied.)

Icahn asserted someone could "finance the whole acquistion at $100 a share ... the synergies alone would pay, so you get the company for free."

Faber added a little dig about the $7 billion financing from Jefferies, saying, "They didn't give you the commitment, they said highly confident."

"Come on, David, David," Icahn responded, saying he knows there's never a commitment until the due diligence is done.

"We'd love to buy this," Icahn insisted. "In today's environment, it would be no trouble for us buying it."

Do-your-own stress tests

Gary Kaminsky wasn't on Friday' Strategy Session, but he probably would've been pleased by guest co-host Steve Liesman's description of it as a "premier American business show."

Liesman was sort of acknowledging that people might wonder about the show's devotion to European stress test results (especially when this Medicis CEO situation is far juicier even though it doesn't have anything to do with capital markets) but insisted it's important this time because there's going to be "20 times" more data than before in which case people can actually do their own tests based on different hypotheticals.

(And if that doesn't make you say "Oh, joy," nothing will.)

Guest George Concalves, like everyone else spending the show's few precious minutes on the subject trying to figure out exactly what the results were, said any bounce was "short-lived," and that "derivative exposure" is not being talked about enough.

Brad Hintz talked about sovereign loss expectations and said he thinks "people (are) using a 50-70% number on, on Greece, a 40-60% number on, on Portugal," but that some are talking about only a 10% haircut.

Brian Sullivan complained that the results were not being distributed in an "easy-to-read press release."

David Faber tried to synch up with Brian Schactman at the NYSE, but that didn't work, and it sounded like Steve Liesman was tapping annoyingly on The Strategy Session table.

She’s hot, yes

David Faber on Friday's Strategy Session offered a nice little observation about the scenery involving Michelle Caruso-Cabrera in Rome, then apparently decided it came out the wrong way and tried to clarify, only to basically make it worse (if it was even bad to begin with, which it wasn't).

MCC was standing in front of the Colisseum reporting on how Italian lawmakers had hustled to make sure the markets knew they were serious about austerity. Faber closed by cutting away and observing, "What a beautiful shot that is Michelle."

The guess here is that evidently, Faber felt a bit squeamish about "beautiful" misinterpretations for some reason, because after returning to Caruso-Cabrera moments later, he felt compelled to define exactly what he meant by "beautiful" but then couldn't stop the runaway train from plowing into MCC's clothing, explaining, "I could look all day at that, that, beautiful background of the colisseum, that nice pink shirt." (As far as we could tell, it was actually an orange shirt.)

She looked awesome, and a date with MCC at the Colisseum would be awesome, but unfortunately she only went with a pedestrian hairstyle Friday.

[Thursday, July 14, 2011]

Karen Finerman takes our Fast Money Netflix dialogue template from a day ago and turns it on its head

Yesterday we outlined the basic thread of Fast Money conversations about Netflix, and how it's usually the guest who's either a short or a skeptical analyst who makes the argument that all of the purportedly overly rosy NFLX revenue projections are made without competition, and just wait until Hulu or Google or someone else jumps in and competes.

Thursday, it was Karen Finerman of all people who made that argument, suggesting that if Google does indeed buy Hulu, "Maybe maybe maybe that's the, that would be the time to short Netflix."

(At that point, someone's supposed to say, "Reed Hastings is ahead of the curve and already has a lot of exclusive content locked up," but nobody did.)

You won’t find 40-1 anymore, unless you’re talking Minnesota Vikings odds

Doug Kass on Thursday's Fast Money shrugged off JPMorgan's earnings report, and we couldn't have agreed more with what he said about the banks.

"The problem to me is structural, and secular," Kass said, and encompasses much more than 1 quarterly earnings report.

Kass pointed out that the relatively small amount of cash BAC spent on Countrywide has ended up costing it nearly tenfold on that "investment," that a year ago he could see $3 EPS for BAC but now it'd be under $2, and that instead of happening in 2012, "normalized" bank earnings may not arrive until 2014.

Karen Finerman, in an outfit that cost about seventy-five hundred dollars, made her usual argument, that under this depression-type "valuation" a name like BAC is unbelievably cheap.

That assumes the whole company is just like it was during the last crisis, when in fact this time it's 1) much bigger thanks to Merrill and Countrywide, and 2) lacks the superstar CEO in his prime but is run by a guy Mel Lee already thinks should get the boot.

See, here's the deal with the banks ... banks sell credit. Credit is not exactly in as much demand right now as the iPad or metallurgical coal.

In fact, credit is about as popular as a visit by Roger Goodell to the Steelers' locker room.

Kass told Finerman, "Valuation, uh, should not be the dominant factor in buying or shorting a stock."

Melissa Lee, stressing she truly only had 10 seconds, asked Kass to clearly state his position/recommendation on banks. Kass said he's not short, but he did what he always does, referring to something he said on a previous show, and recommended people try life insurance instead, which wasn't Lee's question, but Lee somehow didn't bother to cut him off in this "only 10 seconds" window which of course ran over, at least the 2nd time Thursday that happened after Kayla Tausche overdid it in the same scenario with Tyler Mathisen on Power Lunch.

Navellier: CAT could
reach $125 ‘easily’

Louis Navellier, who knocked one out of the park last year in BIDU, told the Fast Money gang on Thursday he sees "massive surprises" ahead in cyclicals.

He indicated he likes VMW, FFIV and CAT; "We expect very nice surprises from all of those."

Guy Adami asked Navellier if he likes CAT enough to think it can get to 125.

"Easily. Easily," Navellier said, adding, "I plan to ride the stock for at least another year or so."

Those AAPL e-mailers really get under Guy Adami’s skin

Guy Adami admitted on Thursday's Fast Money "I was one of those people" who thought GOOG would trace back down to $500.

But he seemed less concerned about GOOG fans than AAPL fans.

"I'm sure everybody's all lubed up," he said. "I get so many e-mails- It's amazing, you say 1 bad thing about Apple, I mean, you, you get your head blown off."

Dr. J takes utterly goofy Vladimir Putin footage a bit too seriously

We had already practically forgotten about one analyst's Halftime Report call on COF Tuesday. Evidently, something Joshua Steiner said stuck in the craw of Jon Najarian.

"On Halftime the other day, we had that person on, Josh I think his name was, that said, he sees an increase in bankruptcies. I don't know why he sees an increase in bankruptcies given that they've been dropping pretty dramatically. This news from JPMorgan I bet turns him around on that," Najarian said on Thursday's Fast Money.

Dr. J was also suggesting somebody else might be on the wrong side of a trade, after Jim Iuorio sort of took a victory lap on the VIX and suggested "if it shoots up, it should shoot up like a meteor."

Najarian credited Iuorio for his description of the VIX, then spoke about his own trading of the VIXY, then mentioned Rick Santelli in regards to the debt limit, saying, "I think the Rickster's got this wrong," but we were never sure exactly what Santelli prediction he was referring to.

Few things are more obnoxious than people who are mocking a subject someone wants to make a serious point about. Dr. J ran into just such a situation at the first commercial of Thursday's Fast Money, when Melissa Lee ran a bunch of clips of Vladimir Putin, who apparently derided money-printing in the U.S., shirtless.

Dr. J had no interest in the clothing but in Putin's apparent beef, suggesting if Putin wants to blame someone, he better look to the top and not at the ham 'n' eggers.

"Most Americans are outraged about the printing press running at the speed it's running at," Najarian said, while others clucked about Vlad's body.

Najarian didn't talk about his own account Thursday and thus put together a great show but nearly bungled it away at the last minute with an almost-condescending description of the corn market.

Melissa once again forgets which day Fast Money is not on

Joe Terranova said on Thursday's Fast Money he wasn't terribly excited about ConocoPhillips' breakup. "They're rivaling the model of Marathon," Terranova said, but "big difference though: Marathon is mid-continent."

Stephen Weiss, to the contrary, said, "I think there's a lot of value to be had here; I think you wanna buy it now, as it rides up, until they break it up."

Melissa Lee's hairstyle Thursday did not escape our attention; while cute on some level, from certain angles it didn't look like one of her best.

Lee closed the show apparently oblivious to the material she was reading on the Teleprompter, telling viewers Thursday afternoon, "And back here of course tomorrow at 5 for more Fast Money here on CNBC."

‘Someone’ probably prefers
to remain anonymous

Patty Edwards, who looked to be limited to only 2 soundbites on Thursday's Fast Money Halftime Report until Judge Wapner graciously squeezed in a closing remark on JWN, delivered a slogan attributed to someone else that really is one of those comments we tend to dislike because it's supposed to come across as somewhat profound when it really doesn't mean anything.

"Someone once said, if you're using something for free on the Internet, you're the, uh, you're the product, not the consumer," Edwards claimed.

Now, let's think about that for a moment.

How exactly does anyone "use" something for "free" on the Internet. Virtually everyone is paying for Internet access. You may be at the office on the company computer, but that just means the company is paying for the access (one wouldn't consider his hotel room on a business trip to be "free"). Or you might use the computer at the public library, but you and/or someone else is paying for that with tax dollars.

What Edwards is likely pointing to are things like YouTube, Facebook, Twitter, etc.

In those cases, you're not the "product," but the free labor.

That explains the prodigiousness of Wikipedia, people's bizarre willingness to donate unpaid work with no possibility of receiving any compensation for themselves.

That's also how YouTube, Yelp, HuffPost, the IMDB on some level and countless other sites have succeeded, sort of like Tom Sawyer and the fence-painting trick.

Now, does Edwards' reference to "using" encompass simple "reading"? Trust us, we're not nearly sophisticated enough to think of any of our readers — and thank God you're here (in rapidly growing numbers almost every month) because we'd be going loopy if you weren't — as a "product."

But nor could we argue with a straight face that you're actually "consuming" something here, given there's nothing to actually purchase, and only (a very small number of) tiny things actually worth laughing about.

Of course, we tried to find out who exactly Edwards was quoting, and curiously enough, a Google search (one of those free using things) for "if you're using something for free on the Internet" came up with no results.

We did get some scattered results for "you're the product, not the consumer," but those ranged across the board, even one author referring to doctors' prescriptions.

Evidently in the Internet sphere Edwards was referencing, the best guess is someone named Bruce Schneier, specifically talking about Facebook.

Whoever coined it is off to a decent start, but it clearly needs polish.

Sunshine, on our shoulders, makes us feel happy.

Adami: GOOG could retest $500

Guest Ben Schachter advanced Google's earnings on Thursday's Fast Money Halftime Report with barely any excitement, saying it's a beneficiary of mobile devices, and "You're seeing a stock that people wanna own again."

Guy Adami was rightfully skeptical, saying, "It hasn't performed over the last year. ... I lean towards taking a shot on the short side" and thinks it might test $500, though he wasn't strongly advocating that.

Patty Edwards said, "You absolutely need to be looking at their ad revenues," and then made that "free" Internet quote. Edwards said the "ancillary" businesses of Google really aren't driving anything.

Guy Adami helps reveal that Daniel Fisher offered a trade that few viewers can actually make

Guest Paul Sankey wasn't as enthusiastic about ConocoPhillips' new thing as Judge Scott Wapner might've been led to believe on Thursday's Fast Money Halftime Report.

"I'm not so sure the market loves it," Sankey said, saying there's a lot of "short covering" and that this was a "total surprise announcement, let me tell you."

Sankey rattled off a bunch of refiners, Holly, Frontier, MPC, Coffeyville, Western, in what he calls the "Diamond Age of refining."

Wapner asked if the integrated model for oil is under siege. "The market's trying to kill it," Sankey said, saying if anybody's in line for a COP-like move, "Chevron should, but I doubt they will," because they're too happy with the cash they're getting.

Guy Adami mentioned Halliburton, and Brian Kelly pointed to silver and gold.

Steve Cortes said, "I am short crude oil ... main reason I'm short is the Chinese share performance ... I think the future for energy is poor."

Patty Edwards, who didn't get a chance for the show's first 7 minutes and then had to wait about another 10, said she has positions in COP, CVX and CBI.

Stephen Weiss called COP a "great story, more shareholder value to come."

Guy Adami praised the apparent new restraint about a QE3. "Finally I think there's some adults in the room," Adami said, rather condescendingly.

Daniel Fisher, who always launches into his nat gas trading thesis before the Fast Money Halftime host can ask a question, said Thursday, "I'd rather be short in the medium-term, long October, and I'm short January."

Guy Adami said that's fine for futures traders to do, but what about the typical retail investor watching at home. Fisher had no plan for that, saying he's not a big fan of the UNG.

Steve Cortes claims 9½% growth not enough to sustain China

Brian Kelly on Thursday's Fast Money Halftime Report somehow claimed he was ready to get back into a trade he just got stopped out on.

"I was long Toll up till yesterday afternoon when I got stopped out, but here's a place that I would look at again," Kelly said.

Kelly also found himself in a China argument with Steve Cortes, who claimed, "China needs double-digit growth, not 9½% growth."

"9½% is pretty good!" Kelly insisted, but Cortes scoffed and said that's not enough for the biggest migration in history.

Judge Scott Wapner called Stephen Weiss for a "Hallelujah moment" on JPM. Weiss said "they're really firing on all cylinders," and even, "they're seeing some modest loan growth."

(Key word there being "modest.")

Judge Wapner asked a good if necessary question, did Weiss add more. Weiss said, "I didn't, because I've got a full position."

Patty Edwards said "I like Nordstrom here ... Nordstrom over Macy's, absolutely," and said in Call the Close, "I think I like Potash at this level."

Brian Kelly said "I think you sell this market," while Steve Cortes touted Philip Morris.

Smile Curve: ‘There are
no good mid-sized firms’

Mark Yusko, Strategy Session guest on Thursday, is a quote machine.

For example, he said there's a "smile curve" of investing success based on a firm's size: "There are great small firms, and there are great large firms. There are no good mid-sized firms."

He told David Faber he doesn't even like the term "fund of funds" to describe his business. "I actually don't even use the word 'fund of funds' anymore. I, I actually like to prefer 'manager of managers'," Yusko said.

Furthermore, he avoids "Red-Ferrari Syndrome," which he said is this: "If you buy a red Ferrari, we're likely not gonna be invested with you anymore." (However, he used an example of a guy with a Toyota truck who made a wager about buying a new truck that really didn't make any sense or at least didn't have an ending.)

Finally, Yusko claimed that "performance ... is a symptom," which we'd have to disagree with, given that it's the old mathematical blunder similar to assuming what you're trying to prove is true or something like that, like the goal not being met is actually the goal.

Instead, Yusko claims a 3-P standard of "people, process philosophy" for sticking with investments — "You change any of those 3, we're gone."

Yusko said 3 things have worked recently: sovereign debt hedging, fundamental long/short equity (in his opinion the right stocks are moving up and the wrong ones down), and the pre-IPO investing crowd.

He also said, "I think we're closer to deflation than inflation."

Yusko, we discovered, used to be a honcho with the University of North Carolina endowment, which makes us suspicious, but we also found that he and his wife gave $35 million to his alma mater, Notre Dame, last year, the university's 3rd-largest gift ever. (Let's hope it actually goes toward making youngsters smarter, and not for new buildings, padding the endowment, or neat stuff that merely helps recruit the smarter kids.)

Yusko conceded that the anti-fund-of-fund argument of paying fees on fees that David Faber raised in the beginning of their conversation is "actually a great point."

Sometimes the actual program doesn’t quite match the teaser

John Buckingham purportedly guested at the end of Thursday's Strategy Session to identify 3 stocks with higher yields than the 10-year.

But all Buckingham actually identified were 2 stocks — Whirlpool and Freeport McMoRan — neither of which is yielding more than the 10-year.

Gary Kaminsky questioned FCX as a top pick for a Yield Hunter, but Buckingham asserted, "Freeport McMoran continue to be very generous with that dividend."

By that point, David Faber said "gotta leave it there." (Because at the rate they were going, probably the next "yield" pick was going to be POT.)

Gary Kaminsky was in semi/subtle "smile curve" mode when discussing the "mission statement" of The Strategy Session and referencing a certain prominent analyst who dissed the muni sector last year with an eye on July 1. "I own some munis, I own some corporates as you know," Kaminsky told David Faber, and "I looked at my account last week, you know, I actually got paid."

"Analysts wanna make sensational calls," Kaminsky declared.

Kaminsky was in full "smile curve" mode in noting the water main break in Englewood Cliffs and how he "just ate a lot of food with a lot of onions." (Why CNBC started serving up onions after a water main break was unclear, though perhaps there's some kind of boil order in the company kitchen.)

Does Ben S. Bernanke
deserve to be fired?

Gary Kaminsky didn't have much of a smile curve on Thursday's Strategy Session when critiquing the performance of the Federal Reserve chief with colleague/nemesis Steve Liesman.

"I think we can both agree, no CEO would last in a job that long making that many U-turns on the progress of that forecast that they themselves gave to that board," Kaminsky said.

"I don't agree at all Gary," Liesman responded. "I think facts on the grounds (sic) change. And the real grounds for firing him would be failure to change his policy in the face of changing economic conditions."

"Well you want- listen, you want your CEO to be adaptable and you want your CEO to be-" Kaminsky said.

"You don't want him to be an idiot," asserted Liesman, who finally demanded to know, "What's your problem Gary?"

"I think it's probably one of the best jobs in America. I think, uh, a lot of people that don't have jobs would like that job," Kaminsky said, continuing to press Liesman's buttons, the continuing, "I'm just saying that many people would like to have a professional position where you can flip-flop like that as a result of what may be happening. Most CEOs don't have that luxury."

Pressed by Liesman to specify the flip-flops, Kaminsky concluded, "The fact that we're even having a conversation of a possible QE3 ... If that was a company and he was a CEO, I think he loses his job."

Woman found dead at home of CEO who appeared on Fast Money last September

The Arizona Republic reported Wednesday that a woman died at the California mansion of Medicis CEO Jonah Shacknai.

The Republic notes, "The boy's grandmother told The Arizona Republic that the woman was Shacknai's girlfriend."

Just 2 days earlier, Shacknai's son was severely injured in a fall at the home.

Shacknai guested on the Fast Money Halftime Report on Sept. 17, 2010, and handed out compliments, telling Melissa Lee, "It's my pleasure to be on your terrific show." Lee was impressed by Shacknai's discussion of his new products: "Blasting butt cells out of existence; that sounds pretty attractive to me, Jonah," Lee said.

headline goes here

Chats with Netflix skeptics on Fast Money are so routine, we can basically do a template.

Fast Money host: "Why'd you downgrade the stock?"

Guest: "The market is pricing in a growth rate that just can't last; Google or somebody else is gonna compete with 'em."

Fast Money panelist I: "Don't you think they could use some of their stock as a way to raise capital to cover some of these costs?"

Guest: "That's not a long-term solution. Here's the problem: They've got all these off-balance-sheet obligations. There's not enough potential subscribers out there to make up these content costs, and that's with NO competition!!!"

Fast Money panelist II: "The stock is 100 points above your target; at what point do you just admit defeat and throw in the towel?"

Guest: "Actually I was bullish on the stock for a long time until recently. The stock obviously trades on momentum ..."

Wednesday, it was Tony Wible's turn to play skeptic again, complaining that no one including Mark Mahaney (not mentioned by name) has "addressed the fact the company is losing money on a cash basis," and insisting, "they're increasing price out of necessity."

Karen Finerman sort of stuck it to Wible, asking him what level of churn would be required to make the price hike enough to beat revenue estimates. Wible took a cop-out, claiming, "It's really impossible to figure out how this goes," which suggests to us, with no other information, that it's probably likely NFLX beats on revenue next quarter.

(The headline on this item is intentional, as a tribute to the template theme and inside joke on a common print media fear.)

Another suggestion of something Google could buy

Mike Abramsky promoted a semi-interesting idea on Wednesday's Fast Money, which was for Research in Motion to split itself up before the handset problem takes down the whole company.

It's interesting, only to the extent anyone still thinks RIMM shares ("The FOUR HORSEMEN!!!" Jim Cramer often said not too long ago) are interesting.

Guy Adami asked Abramsky, when do we start hearing the term "strategic alternatives," but Abramsky didn't really answer the question, only claiming that his own idea is a "strategic alternative" and in fact "it actually does make it easier for acquirers to buy these com-, uh, different businesses," perhaps Samsung for the handsets and Google for the networks (but hold on, Google's still got to find a way to get into the Netflix market).

Abramsky also for whatever reason looked down and seemed to be reading his notes during much of his answer to Joe Terranova's excellent Palm question.

Nevertheless, "I think we really hit a nerve," Abramsky told Melissa Lee, who always asks guests for the reax they're getting.

Melissa nearly gets it,
but not quite

It was only a month ago or so when Fast Money aired during "breaking news" of the Greek parliament no-confidence vote, and the commentary ran dry so quickly, we lamented the fact there were no commercials.

(And then a day or 2 later, Guy Adami sort of scoffed on-air that viewers would be getting commercials tonight. Hey, we just call it like it is; "Horrible Bosses" would've been better off with a couple of commercials too.)

Anyway, Wednesday's Fast Money was heading that direction on the Moody's breaking news, but this time thankfully producers saw fit to move on after the first regular commercial break.

Karen Finerman of all people offered the most head-scratching analysis of the Moody's review, saying "Maybe it puts additional pressure on both parties."

Dennis Gartman at least said, "I think it's terribly overblown," but even so, he had a trade; "I'm probably gonna buy dollars; I'm probably gonna sell euros on this news."

Brian Stutland also had a trade. "I bought some out-of-the-money calls" in GLD, he said.

Eventually Melissa Lee claimed that the "conspiracy theorist" in her wonders if lawmakers are actually "pretty happy" with a credit-rating review "because it will get them closer to a deal."

Obviously, there's no conspiracy needed; it's obligatory news that puts no pressure on anyone, but actually gives them cover to make a deal.

The best part of this subject was a glimpse of Mandy in her Swiss Miss outfit.

Sean Egan issues Brag Trade
in category of credit reviews

Sean Egan spoke about the Moody's review on Wednesday's Fast Money and sounded like he might be opening a can of worms when suggesting, "There's a difference between a delinquency and default."

Honestly, nobody really needs to know what that is, and thankfully Egan didn't plow too deeply into it.

But he did have a minor facial to give Moody's when Melissa Lee asked for his own credit stance on U.S. debt.

"We put it on negative watch as of March 1st of this year," Egan said. "Moody's took the action today; we took it back on March 1st."

Guy Adami asked Egan "what happens" if there's no deal. Egan didn't answer the question, which tells us the real answer is basically "nothing," but Egan merely said a AAA rating isn't everything; "It can survive at the AA level."

Why in the world does Karen Finerman keep recommending JPMorgan?

This page says gobs of nice things about Karen Finerman (hot sleeveless dress Wednesday probably made many forget about Diana Olick), but one thing we can't say nice things about is her dreadful chain of value picks, which usually is JPM and HPQ plus another bank or 2 and sometimes MSFT or CSCO.

How in the world this counts as "Fast Money," we have no clue.

But there she was again on Wednesday, talking about being long JPM into earnings.

Lessee ... a business that exists to extend credit, in a world where credit is 1) a bad term and 2) not particularly wanted anymore, hampered by regulatory interest that's gonna exist for a long time and surrounded by a whole host of competitors many of whom should be too weak to take them on but are now propped up to do so thanks to the terribly-afraid-of-a-bank-failure U.S. government.

Sounds like a Netflix-type of story.

Brian Kelly, hypothesizing what he would ask Jamie Dimon, offered the most bone-headed query of the day, "What would induce you to lend?" (That's almost equivalent to asking fast-talkin' Irv — we won't give the last name because he's probably still out there somewhere — what would "induce" him to actually sell us a car.)

Adami: MSFT could buy ERTS

Guy Adami on Wednesday made the type of comment he makes about once a month on Fast Money; "we are at I believe at (sic) really critical levels right now in the S&P."

Adami didn't have any good Phillips-Van Heusen offers to share with Melissa Lee this time, but did make a case for an ERTS takeover. "Microsoft is sitting on a ton of cash, and them buying ERTS is not a crazy thought by any stretch of the imagination," he said.

Stephen Weiss early on Wednesday's program said "things have to get a lot worse, I mean a lot worse," for QE3 to happen, but somehow his commentary caught Melissa Lee off guard and was followed by a bit of dead air.

Karen Finerman said, "I'm sad to say I don't have a lot of YUM left," but that the valuation is getting out of her range. Tim Freeman said he thinks the VIX will spike up Thursday around 21 before a selloff. Joe Terranova said "I'm adding to my long Toyota Motors," while Guy Adami and Brian Kelly both touted silver.

Steve Cortes insists there will be no QE3

Steve Cortes, on the abbreviated Wednesday Fast Money Halftime Report, seemed to be confusing what he wants to happen with what actually is going to happen.

Or might be going to happen.

"This Congress is in no mood to tolerate more central planning," Cortes claimed, calling QE2 a "massive mistake" and asserting, "look, there should've only been 2 Godfathers."

Judge Wapner, back in the saddle Wednesday, challenged Cortes to explain how it's a failure when stocks have taken off since a year ago.

Cortes, in "Starsky & Hutch"-esque open collar, grumbled that it "clearly benefitted asset prices undoubtedly," but "it created exactly the wrong kind of inflation" that helped the wealthy and stung the middle-class and poor (gee whiz, Steve might as well have taken a seat with some of the congresspeople Wednesday).

Zachary Karabell opened with another one-liner, saying "Godfather III may have ended Sofia Coppola's acting career, but it launched her directing career."

Karabell called Wednesday's Bernanke/stock activity just another "daily dose" in a "rangy market."

Pete Najarian thundered, "I think you gotta look towards China," which was seconded by most of the panel but not Steve Cortes. Brian Kelly gushed, "I love the risk-on trade," saying we're back to the "David Tepper win-win." Kelly said he's long silver and bought some GDXJ.

Kelly also said people in China are "going in hordes to buy the stock market there," thus he likes the CAF, which is the Morgan Stanley A shares.

Zach Karabell said you can also try the YINN.

Starsky Cortes complained that everyone on Fast Money likes to "fawn" over China but that Chinese stocks haven't been great. Zach Karabell argued that it's not about Chinese stocks but the Chinese economy. Cortes responded that you can't trade GDP, you have to trade stocks. Karabell quit replying.

Cortes didn't have any new recommendations for LULU, rising again Wednesday, possibly the most embarrassing Fast Money call in the last couple years.

Chris Mutascio said QE3 would hurt banks because it would keep interest rates low.

Bernanke testimony
wipes out Strategy Session

Federal Reserve Chairman Ben S. Bernanke took questions from a House panel on Wednesday, preempting The Strategy Session and part of the Fast Money Halftime Report.

Most significantly, Bernanke responded to a QE3 question this way: "I think we have to keep all the options on the table."

Steve Liesman said that amounts to, "He took the QE3 out of drydock."

Bernanke also told one skeptic who quoted Ron Paul that the Fed purchases are not done with taxpayer dollars. "We're not printing money, we're creating reserves in the banking system," Bernanke said.

One representative said he knows from his business experience that he does things that are SMART: "Specific, Measurable, Attainable, Realistic, Timely." (Yes, these are the types of things they apparently talk about in Congress.)

[Tuesday, July 12, 2011]

Guy Adami claims he’s been
‘on the fence’ about gold

People who look for contra-indicators in things might wonder if Guy Adami's embrace of gold is the sign of a top.

Tuesday on Fast Money, Adami gave this historical rationale: "I've been obviously on the fence on this one, probably on the wrong side of the fence, but every fiat currency since the Roman Empire in the first century has ended in disaster. You go back to Germany, pre-World War I, when, I think a deutschmark was, you know, 1 U.S. dollar, 12 deutschmarks, by 1923, it was up to a trillion or so deutschmarks. Not to say that the U.S. dollar's headed that way, but it's clearly headed in that direction. And so, gold wins that."

He said he'd rather play silver, but "gold still works."

The funny thing about this newfound fence-sitting is that Adami wasn't making the 1923 deutschmark argument on Dec. 18, 2009, when he began his months-long carping about American Barrick buying back its hedges by saying, "All I know is since they announced they're done buying their hedges, gold's gone straight down"; nor was he talking about U.S. dollar direction in February this year when he chided Newmont's CEO Richard O'Brien for taking off the hedges at $1,300 (which O'Brien announced back in November), saying, "His investors want exposure to gold when it's $1,300 an ounce. God forbid it goes south of a thousand, and those same investors who want exposure to gold will be asking why they weren't hedging gold at 1,300."

Nor has Adami expressed concerns about fiat currencies and dollar direction since the beginning of the entire run of Fast Money, during which he has often reminded viewers there's gonna be a day when gold will just fall $100, $150 in a day.

Dan Nathan cautioned that "It's a very very crowded trade" in the GLD, and that if the markets experience a "risk-off panic," big holders will be turning to unload it for liquidity.

Karen Finerman, who prefers to buy things in which the valuation gets even more "ridiculous" or "absurd" after she buys them, advised that if/when she ever gets into gold, she would "guarantee" that'll be the top.

Netflix: The AAPL, or the RIMM, of movie delivery?

Dan Nathan said something about NFLX on Tuesday's Fast Money that sounded a bit crazy.

"You'd have to be crazy to buy this stock here. I'm not telling you to short it, 'cause that's crazy too," Nathan said.

"Crazy" ... to buy a stock that's positively on fire.

Guess he feels less crazy about the CSCO variety.

Nathan spoke after superstar analyst Mark Mahaney neatly summarized the Netflix pricing plan, saying he thinks the company is doing it from a "position of strength," and even went so far to say, "For 7.99 I think it's the 2nd-best meal, uh, deal in America after the Happy Meal, 7.99 for unlimited video."

Yet Mahaney wasn't plunging in, saying "I'm gonna wait on this one" because of its upcoming international launch, which he said has many things going for it but could also be a stumble.

Karen Finerman offered the bear case — the costs for acquiring content — and asked Mahaney to rebut. He said, "I think it does limit margin expansion from current levels, but I think they've set this up right," in that streaming costs them much less in postage and so the company's improving on that end of the cost equation.

Melissa Lee revealed she's a Netflix subscriber. "I stream, and I have DVDs," Lee said.

Guy Adami said Lee should get Fast Money Friend Michael Burns of Lions Gate to help her out with "Mad Men." "You both like the guy," Adami said to Lee and Karen Finerman, "and he's a handsome man."

"Handsome man," Karen Finerman agreed.

Netflix vs. Apple,
from $200 to $300

Since this page is alone in suggesting NFLX might just beat AAPL to $400 (this writer has no position in either name), we figured some historical info would be a good idea.

Here are some notable intraday breakthroughs of NFLX, according to Yahoo finance:

April 22, 2010 — $102.49
Nov. 29, 2010 — $200.00 (7 months)
July 11, 2011 — $301.50 (8 months)

AAPL made its triple-digit runs before and after the 2008 debacle and the first Steve Jobs leave:

April 26, 2007 — $102.50
Dec. 26, 2007 — $200.96 (8 months)
Feb. 6, 2009 — $100.00
Oct. 20, 2009 — $201.75 (8 months)
Oct. 13, 2010 — $301.96 (12 months)

Keep in mind that nominal stock prices, as the Fast Money gang likes to point out, are arbitrary; C will probably be $400 a share before AAPL or NFLX.

Obviously, AAPL also has a much more massive market cap than NFLX.

On the other hand, AAPL isn't nearly as controversial as NFLX, nor as shorted.

There's at least 1 argument heard on CNBC against NFLX that sounds a lot like a previous argument against PCLN, which is that Google and others will just enter the space and the competition will be a killer.

In fact, while NFLX wasn't early enough for the dot-com crash, its chart resembles a latter-stage PCLN chart, which has details such as these:

April 30, 2009 — $100.50
Nov. 10, 2009 — $209.19 (6 months)
Aug. 12, 2010 — $300.85 (9 months)
Nov. 9, 2010 — $428.10 (3 months)

So the question would seem to be whether NFLX is the BlackBerry, surging to the top of its field just before a new entrant begins to make it obsolete or a 2nd choice ... or whether NFLX is the iPod, the preferred distributor of a lucrative media and so well-entrenched and established by now that not even the producers of the content it sells are willing to fight it and prefer to just go along.

We have no skin in this game, but we'd have to lean toward the latter.

Stephen Weiss packs as much punch as possible into limited airtime

Melissa Lee for some reason opted to begin Tuesday's Fast Money with a wide-ranging discussion about the Fed minutes.

Stephen Weiss said, "I think QE3 is a real possibility," but the others basically rejected that notion, and Weiss was barely heard from the rest of the program.

"QE3 is not going to happen. It cannot happen," said Joe Terranova, who said there would be a "bearish" reaction if it does.

Dan Nathan said there's no "political will" for QE3, and as for the Fed, "they don't have a whole heckuva lot left" they can try, which is a very dubious argument; we heard that a lot in the winter of 2008-'09, and then Citigroup suddenly reported a "profit," and ...

Guy Adami said efforts to help unemployment seem fruitless; "we're in a structural job change right now." Mike Khouw offered, "I'm not sure that a whole lot can be done here."

Terranova gave himself a Fast Fire, saying he predicted there'd be a market floor under the jobs report Friday, and "that clearly was wrong; Karen was right in her assessment."

Finerman seemed to agree with the others on stimulus but said the one area that could really use some jobs is housing, and "I don't know what the Fed could do to help that situation," saying that would require "some other kind of policy measure," although it's important to note she didn't explain what that policy would be.

Melissa rejects notion of shopping at Phillips-Van Heusen

Melissa Lee was reporting Tuesday on some kind of Bespoke finding that a lot of companies you wouldn't expect, unlike Alcoa, are really the earnings bellwethers for the stock market.

One of those was Phillips-Van Heusen, which prompted Guy Adami to speculate to Lee, "Maybe we can go shopping together and you can pick me out a Phillips-Van Heusen shirt. No? Something nice. In a blue, in a nice blue."

He's onto something there, as it's entertaining to consider the notion of shopping with Lee, picking up a shirt or 2, maybe catching some Netflix later (DVD or streaming), and, who knows, talking about the euro/yen or something.

Lee later jabbed Adami, saying, "Seriously, I thought maybe you bought your jeans at Sears."

Adami said no, he goes to the Levi's store. "I'm down to a 34 waist, 34-32," he said, "so my length of the jeans is actually smaller than my waist. That's an anomaly, they call it." It is? We think the anomaly's probably the other way around.

Hopefully Gloria Steinem took a pass on Fast Money Tuesday

Edward Mills, who turns up on Fast Money whenever gridlock surfaces in the news, said he's been guaranteed by D.C. insiders that there's going to be a debt-ceiling hike, and it's "gonna come with massive spending cuts," but that there's no guarantee it'll happen by Aug. 2.

He said, if not, there'll be a "significant negative reaction in the market," which might be what it takes to make it happen.

Guy Adami, who seems he won't get Jedi-mind-tricked, suggested Cisco got nothing more than a "bounce" from its Hollywood-like story of job cuts by greedy millionaire execs simply to goose the stock price like in "The Company Men," and that previous bounces were a time to sell, and, " my sense is, this is as well."

Adami later pointed to Juniper as one to watch. "It wouldn't surprise me if a company like Oracle were kicking the tires in a name like Juniper at current levels," Adami said.

Karen Finerman said "We like BMW," and "I still do like Cummins." Joe Terranova cited $12.50 as a reference point for F.

Jane Wells drove a backhoe in Las Vegas. Now, if you're like us and wondered momentarily who in the world ordered this segment, know that one absolute must of TV producers is to show people like Jane doing cute things, so it makes perfect sense ... except this one was a bust, because the camera was way too far away from Jane, and even the Fast Money gang was skeptical she was even doing the driving.

The guy who owns whatever place Jane was at said, "We get a lot of bucket-listers," and 50% of the customers are women, and we would have to think, probably 90% of those are intoxicated.

Dan Nathan also noticed that 50% tally, saying, "They said that 50% of their clients are women; I hope they have a lot of insurance."

"Ooooooooh," Karen Finerman was heard to say.

"My wife can barely drive her SUV," Nathan continued.

Karen should’ve tried to answer her own question

Chartist Jeff DeGraaf coined a new concept for us on Tuesday's Fast Money.

DeGraaf said that as far as 20-day highs among S&P names go, the stock market has "got to a level that we've only seen 6 times in the last 20 years."

That, he said, "tends to be a very bullish overbought condition."

Repeating: "a very bullish overbought condition."

But on the flip side, DeGraaf showed a chart of the S&P with credit default swaps inversed since March 2008 and said the recent trend shows credit has not been keeping up with the market. And so, that "puts us in that 1,350 camp."

Karen Finerman made a great observation, noticing that both the S&P and CDS trend lines since DeGraaf's March 2008 starting point were essentially back to the level they started at. So Finerman asked DeGraaf what he makes of that.

DeGraaf didn't answer the question. He said, "The reference points aren't as important as what the overall trend is." Or put another way, "Hadn't thought about that one, Karen."

Around here, we did give it a thought, and concluded that it really only means the inverse CDS curve moves similarly to stocks but not exactly, and that there isn't any correlation between now and March 2008, because March 2008 was falling-knife land, whereas the current chart is going the opposite direction.

‘The Company Men’ might be a popular choice around San Jose

Jon Najarian sort of pulled a Gerald Ford on Tuesday's Fast Money, suggesting that CSCO investors' long nightmare might be over.

"I'm not saying the absolute bottom's in, but it's certainly very close at this point," Najarian said.

JJ Kinahan basically seconded that, saying "I am long Cisco right here" because the likelihood of going to 12 or 13 is less than the likelihood of going to 20.

CSCO was moving because Melissa Lee (and here we were all excited about Judge Wapner's new permanent gig, and after 1 day, Mel's back in the saddle) reported on "speculation the company may slash as many as 10 ... thousand ... jobs."

Analyst Brian Marshall said his forecast has been 5,000 but 10,000 is possible and actually better for the bottom line; "that could add, you know, roughly 25 cents to our current EPS estimate on a pro-forma basis," he said.

Nevertheless he called CSCO the "quintessential value trap," even though the layoffs are a "step in the right direction."

Joe Terranova said Cisco has an "identity crisis."

First, we wish the best for Cisco workers; 2nd, we can't help but note that the market reaction is exactly what Hollywood tends to think of layoffs, that it's greedy, highly paid corporate execs cutting productive people merely to toy with stock prices. (Maybe that's why there's "Atlas Shrugged.")

Steve Cortes showed he might not have a correct stock call, but at least he has a heart. "I do think it's sad that 10,000 people had to lose their jobs for this stock to pop," Cortes said, admitting that, "I did try to buy Cisco actually several weeks ago; did not work," and that government spending is the problem.

Might not be in your wallet

Analyst Joshua Steiner delivered an impressively concise 4-point plan for further trouble in COF on Tuesday's Halftime.

"There's 4 reasons going into the back half of the year," Steiner told Melissa Lee, citing "credit renormalization ... private label mortgage-backed exposure ... consumer financial protection ... notable pickup in consumer bankruptcy filings."

He told Lee it doesn't apply to Discover in all areas, because "Discover is not on the hook for the private label mortgage-backed securities."

Cortes shorts AAPL

Nicholas Colas, in a segment debating whether the 2011 stock market is a "sham," spoke on Tuesday's Halftime Fast Line to say that, specifying Greece, "big macro factors" are driving most stocks rather than real fundamentals.

Steve Grasso wasn't available to say 2/3 of stocks trade with the overall market all the time.

Colas even argued, "You've gotta focus on financials as the leadership group of the market. If they are not leadership, I'd be suspect of any rally going forward."

Melissa Lee stumbled over saying "consumer discretionary," another sign that term needs a sexier upgrade.

Colas argued "gold is 1 area that is behaving as it should," in basically no correlation to the S&P, which is why money is moving into it for the diversity, which is why he thinks this whole correlation concept is important.

"I do not wanna buy gold," said Steve Cortes. "I am short silver."

Melissa Lee never got AAPL watcher Maynard Um on the Fast Line to discuss his $510 price target, but she did get Jon Najarian say there will be an opportunity to get AAPL lower in the next couple months, "maybe not just 1."

Steve Cortes said "I actually shorted Apple this morning," prompted by analyst unanimity.

Melissa Lee made a good point about AAPL market cap over the last couple years vs. that of other phone handset makers.

JJ Kinahan said he's a "little bit nervous about" Verizon.

No one knows why anyone needs John Paulson to invest in gold for them

Kate Kelly, chipper and glam on Tuesday's Strategy Session, said there's a "cynical trade" brewing among the "fast money crowd" in regard to anticipated Paulson redemptions.

What that crowd is doing, Kelly said, is "selling or shorting stocks that Paulson owns in big size, on the anticipation that Paulson himself will have to sell down those positions in the coming months to raise cash for the expected redemptions."

Kelly cited as evidence that some of Paulson's biggest holdings — including Citigroup, Anadarko, Transocean and Hartford Financial — have been taking a beating in the last week.

Kelly said Paulson's AUM is about $37-$38 billion and the redemption policy is a standard 30-90 days, so it's "unlikely to be impacted for a while yet" by withdrawals.

Kelly, with colleagues David Faber and Gary Kaminsky, then conducted an interesting point/counterpoint chat largely defending Paulson but questioning some people's decision to hand cash to a hedge fund.

Gary Kaminsky said Paulson's fund is "huge," and a lot of this redemption talk tends to be overblown. Kelly credited Paulson for a huge success in shorting subprime, saying, "I remember covering that firm back in like 2007 at the Wall Street Journal," when it went in a rough calculation from something like $12 billion to around $20 billion.

David Faber added that long-term Paulson investors have to be "extraordinarily happy," and, "He has gotten rich by making big bets and making people money, as opposed to some hedge funds that are very good at collecting money but not particularly good at investing it."

Kelly agreed Paulson is "more than a 1-hit wonder."

Gary Kaminsky said a lot of funds market themselves more conservatively, with 1% positions, which Faber sort of mocked, saying, "The retirement system of X is happy to take 7% from Och-Ziff or whatever it might be."

But then Kaminsky questioned Paulson's gold fund, asking, "If you are managing an institution or pension, you know, some endowment, why would you put money in a gold fund, at 2 and 20?"

"I don't know," Faber said.

Can’t Murdoch just kick the can down the road?

Despite the skepticisms of Gary Kaminsky and David Faber, News Corp. investor Jason Subotky sort of had an answer for everything on Tuesday's Strategy Session.

Subotky said "Sure," he's positive on the stock, because "it's all about context. U.K. newspapers are not very important," and "it's not their first crisis."

David Faber asked if Subotky isn't concerned about the "contagion" that could ripple through the company from the News of the World problem. Subotky downplayed that as "short-term impact."

Gary Kaminsky asked once, and then in a follow-up, with hundreds or thousands of stocks to invest in, why pick this one that has a scandal taint. Subotky said, "It's by far the cheapest, and, uh, the cable content site is the fastest-growing."

Subotky defended the Murdoch family ties this way: "My 2 co-portfolio managers are a father and son, and it's worked really well."

But Kaminsky pressed as to whether Subotky just owns the shares for the growth, or whether he expects that Murdoch "discount" to eventually evaporate. Subotky basically said it's the former, saying the core cable content is growing 25% a year; "there's no other media entity that's growing remotely that fast."

David Faber asked Subotky if he's buying more given the chance to get it cheaper. "We don't comment on what we do," Subotky said. "You know, we only comment on the quarters."

CNBC's Kayla Tausche called Lachlan Murdoch "the perennial bad boy of the family," then referring to James Murdoch, hailed that incredible moment where Rupert Murdoch walked to a conference on a sidewalk in Sun Valley, saying James was "conspicuously absent last week from the Allen & Co. conference where his father most famously were- was."

Kaminsky: 75% of IPOs
priced at or below range

Gary Kaminsky opened Tuesday's Strategy Session with some thoughts on quarterly bank results.

"The expectations are that they will be poor at best," Kaminsky said, but he's hearing that "some of these directional hedge trades have been just massively hurtful, painful ... if anything, I'm gonna say that the numbers will probably come in worse than anticipated."

Kaminsky also said, with an interesting and refreshingly simple pie chart, that the 2011 IPO market isn't as great as maybe some people think thanks to LNKD. Kaminsky said so far, 45.5% were priced within range, 29.5% below the range, and 25% above the range.

And he said that at present, 56% of them are presently trading above IPO price, and 44% below.

Guest Willie Williams pointed to disaparities since 2010 between the euro/Swiss franc and euro/dollar, saying the euro has remained strong vs. the dollar because "this all boils down to the weakness we've seen in the dollar." He said since May 2010, the euro has gone from 132 to 117 vs. the franc.

He said in Europe, "We've seen a little bit of lenders fatigue," mentioned the term "muddle through" (which is starting to rival kick the can down the road), and pointed to how bonds have turned around when the 150-140 range-bound euro approaches 140, making it a "very, very difficult to trade" in hedging currency and derivative risk.

[Monday, July 11, 2011]

Bartels: Gold to $3,000
in ‘probably 3 years’

Sort of out of nowhere, Mary Ann Bartels produced the Fast Money headline of the day Monday.

"In the very near term, we're targeting gold around 1,600 to 1,700, but we're really looking for gold over the next 3 to 5 years, probably 3 years, to go to 2,000 and 3,000," Bartels said.

Yowza.

We noted that once again, a couple gold conversations occurred on Fast Money without Guy Adami saying, "I just know, you're gonna have one of these days where gold trades down $100."

Bartels pointed to the transports as a sign of stock market strength. "It says that any kind of pullback in here should be temporary," she said, and said 1,295 is what "we call the periphery jack in the box," which presumably has nothing to do with the Jack In the Box that Guy Adami has never dined at, even when he had the opportunity at the SALT Conference in Vegas.

Melissa Lee openly questions
Brian Moynihan’s job security

Monday was Day 1 for Mel Lee in her new dual role, and she's already feelin' it.

Crisp and brimming with confidence in royal blue dress on Squawk on the Street, Lee teed off on a certain struggling banking CEO on the 5 p.m. Fast Money.

"How long is Brian Moynihan gonna remain CEO?" Lee asked her colleagues.

"I think he's got time," said Karen Finerman, slightly surprised by the question. "This wasn't exactly his doing .. the issues are not Brian Moynihan's making."

Finerman added, "I think if they were to announce that tomorrow that would be a negative."

(But what if the named successor was Ron Johnson?)

"Hmmm," Lee said, perhaps skeptical of that.

Guy Adami sided with Finerman, saying, "I don't see that happening."

Pete Najarian trampled all over BAC like a 14-tackle game, saying, "Last week it seemed like everybody had that feeling of irrational exuberance, they had that settlement, everybody went GAGA over that, Bank of America starts getting back over 11, and everybody on the desk was pounding, 'God I love these banks!' ... To get too excited right now about the banks I think is foolish."

Finerman felt compelled to admit, "I'm still long LEAPs in JPMorgan."

Najarian refreshingly gave himself a Fast Fire on Morgan Stanley, questioning where the bottom is and noting he bought it "closer to 27."

The funny thing about the Moynihan conversation is that, for reasons of modesty or whatever, no one on the panel suggested what this page alone suggested back in 2009 — that Karen Finerman should've been a candidate for the BAC job, and if the headhunters from Charlotte never even called, that's negligence. Elites like to talk about technicalities; "he/she doesn't have experience in this area," etc., but when you watch Moynihan on CNBC and Finerman on CNBC, which one do you find more impressive?

Low-frequency answers
on high-frequency trading

High-frequency trading critic Eric Hunsader spoke to Fast Money on the Fast Line Monday, but his comments, perhaps ironically, tended to be infrequent.

The panel endured a couple moments of dead air as Hunsader either had troubles with the phone connection, or merely didn't have anything else to say.

Hunsader said in general, within a day or so of exchanges increasing the limits, the new capacity is filled.

That was followed by a pause, then Melissa Lee asking how it helps HF traders to file so many orders and cancel them so quickly.

"A lot of those quotes are actually- have expired before they've even left the exchange network," was Hunsader's non-answer.

JJ Kinahan asked Hunsader if U.S. exchanges would adopt European-style limits in which HFT could occur but only at a cost. Hunsader refused to predict whether that would happen but asserted, "that would get rid of this problem right away."

Karen Finerman — see, these are the great observations BAC should be noticing — asked Hunsader to explain, "How is the retail trader hurt by this?"

This is a great question, not because we think it's not happening, but because the quality of the answer determines how much we should care.

Hunsader began, "Um, well first, well, a number of ways, um, first of all you cannot use market orders anymore, because of it, you can't," then he made a joke about the speed of light, then he stopped talking, and so instead of a "number" of reasons, we got 1, that "you cannot use market orders anymore," except as far as we know, you can.

Brian Kelly afterwards offered his own understanding of HFT. "The people who are providing those quotes are charging a fee for that, and as I understand it, the high-frequency traders jam the system so that the quote is delayed, and they can buy ahead of anything else. That's how I understand it," Kelly said.

Dennis Gartman sees CNBC top in euro-gold

Dennis Gartman indicated on Monday's Fast Money that, based on what he hears on television, there might be some saturation in one of his favorite trades.

"Almost every time I listened to CNBC I was hearing somebody telling me about buying gold in euro terms," Gartman said.

He mentioned a couple times that he has liked buying gold in euro terms for a while (in fact, he has mentioned that so many times since the advent of this site that we've refused to write about it, except Monday he complained about pundits on CNBC, so we have to do it), but at this point, it's "probably a tad overextended."

Gartman complained that business cycles took 2 or 3 years "in my youth," and now they don't.

"We weren't around for your youth, were we?" asked Karen Finerman.

"That was harsh," Gartman said.

Melissa Lee groused that the silver argument has "sort of got me confused," when people will say silver is a "safe haven" when both gold and silver are higher and will say it's an "industrial metal" when there's a gold/silver divergence.

If the Treasury isn’t the safe haven, what is?

This was maybe the easiest CNBC programming call we've ever seen.

We've been certain Nick Bennenbroek was going to surface in the Money in Motion sphere, and probably should've done a headline item on it, except we didn't want to look like knuckleheads if it somehow didn't happen.

Bennenbroek guested on Monday's Fast Money, saying, "I think downside for the euro, we could be looking at 137.50, perhaps even as low as 135," and adding he sees a "continued euro decline." He recommendds selling the euro and buying the yen.

Brian Kelly said "I'm in TBT," largely because of China growth prospects. Karen Finerman, who usually zings the guy who normally sits where Kelly sat Monday, tossed Kelly a great question he couldn't answer, that if there's no debt-ceiling deal, "Where is the flight to quality; what's the quality?"

Karabell accurately on Friday warned the selloff could continue into the next week

Guy Adami said on Monday's Fast Money, "It was about as ho-hum as it gets for Alcoa," and he could've been talking about the AA discussion on Fast Money as well as the earnings report.

Pete Najarian said the market had a "very neutral reaction" to the report. Karen Finerman said Alcoa is a company with "unique issues" and not something that should be seen as a bellwether.

Guy Adami said to look at Boeing ahead of earnings, and Brian Kelly said of autos, "Maybe you do another Cash for Clunkers if the political will is there."

But Zachary Karabell questioned those ideas, saying the automakers might be making wrong assumptions with "X GDP growth, you get Y number of car sales," and that the coast isn't clear for Boeing until the 787 is all good to go.

To summarize, Karabell said, "Don't buy auto stocks, don't buy Alcoa, and wait on Boeing."

Karabell: MON could be 50-plus% higher in a few years

It's hard to go a day on Fast Money — at any point in its history — without someone recommending the ag trade on some level, and Monday it was Zach Karabell's turn, starting with MON.

"I think this stock could be, you know, 50-plus% higher a few years from now; maybe more than that," Karabell said.

Karabell further said it doesn't have to be either/or, he's also in POT and CF, but he thinks MON is used less as a short-term trading vehicle.

Pete Najarian said he's holding MOS because it's above that secondary price.

Pete Najarian gushed about Teck Resources and its Asian exposure a couple times Monday, saying he was selling the upside call. Guy Adami recommended that viewers who missed Jim O'Neill at Halftime with Judge Wapner, "You should go back- if you haven't seen 'em, you should go back and look at the tape of that ... China could trump everything" that's going on in Europe right now.

Guy Adami complained about a Fast Money graphic map of Italy breaking apart from Europe. "That's the only time we've had a graphic that makes fun of a country," Adami said.

Karen Finerman howled at that, saying, "With those Greek dancers, remember those??!!?"

JJ Kinahan said if the S&P breaks 1,316, then 1,300 would be next. Guy Adami said LRCX "could be interesting if it dips below 43."

Pete Najarian laughed too hard at the end when Melissa Lee said he buys all his clothes at TJ Maxx.

We got excited about Mandy Drury's sleeveless outfit on Closing Bell just before Fast Money Monday, except we should note that Diana Olick set the sleeveless curve on Fast Money last week.

Karen Finerman put together a curious ensemble Monday — please note we know nothing about fashion and are sure these are awesome clothes; we're only questioning the color combination — of fuchsia sweater topping off orange dress, almost reminiscent of those bodysuits Rod Stewart put together in the '70s.

"Or find myself a rock 'n' roll band ... that needs a helping hand ..."

Melissa Lee said the word "bikini," telling Guy Adami, "You wear like a bikini."

Google’s hiring

The Fast Money Halftime gang ushered in the official Judge Wapner era Monday with a minor bang — namely, an A-list guest, but followed it with humdrum panelist reax that got no deeper than "if China does great, the global economy will be fine."

But it was actually Jim O'Neill himself who uttered the most dubious soundbite on the program.

Judge Scott Wapner, in an excellent preface, told O'Neill he was quoted as saying "long-term economic growth is driven by the number of people who work, and their productivity," and asked him what that means with 9.2% unemployment.

O'Neill said that number is not a positive, and probably "requires more policy attention."

To think that experts believe Americans need government wonks to get them to work.

Might as well be China.

Jim O’Neill ‘too busy’ to deal with the kinds of rumors Judge Wapner hears

Jim O'Neill indicated on Monday's Fast Money Halftime Report that he's sort of a big-picture guy.

Scott Wapner made a reference to rumors of Italian banks no longer buying Italy's bonds. O'Neill said, "I'm too busy to hear all the tittle talk going on in the markets."

(We're actually not sure he said "talk," but whatever it was, the closed-captioning couldn't figure it out.)

O'Neill said of the strength in the euro, "in some ways it's miraculous," and that Europe is dickering around too much. "This needs big, bold decisions," O'Neill said, telling Brian Kelly that for Europe to find a buyer of last resort requires some "ginormous" undertaking that would lead to a "truly common euro-dominated bond."

O'Neill said his optimism case is based on the possibility that Chinese inflation has peaked, in which case it's off to the races in the 2nd half of the year.

Stephen Weiss said 6.4% Chinese inflation is already presumed; "to me that's already in the market."

Brian Kelly at one point said if you believe in the China story, FDX is the type of name you want to look to buy on the dips.

Patty Edwards, who finally got to speak about 10 minutes into the program which isn't unusual, and this time donned a brown leather jacket, agreed with O'Neill but warned viewers to hold their horses. "I, like Jim O'Neill, believe that China is gonna help lead us out of this," Edwards said. "In the short term, though, I think we've got a rough patch here for at least the next month."

Good thing Zeke
wasn’t around

We kind of figured we'd heard the last of Brian Kelly's aluminum-copper substition theory that was challenged by Zachary Karabell a couple months ago (gosh, that one goes back to February, hard to believe), only to hear it resuscitated by Patty Edwards on Monday's Halftime Pops & Drops regarding FCX.

"You're at about the tipping point where some people will start to substitute into aluminum," Edwards said.

Edwards made an interesting bull call on Alcoa that few have made in the last couple years, saying, "Alcoa's come through very strongly on my models over the past week ... over the long term, it's the type of thing that you wanna be in." (Which is probably another call that the Zekemeister would debate.)

Jeff Kilburg, the guy who played college ball with Ron Powlus, pointed to the 10-year Treasury as the greatest indicator of something since, well, probably "Frampton Comes Alive!"

"I think the bond market continues to have it right here," Kilburg said.

Stephen Weiss took some jabbing from Judge Wapner about JPM (we can't fathom how that stock is so popular on Fast Money, but whatever), saying he continues to own, isn't selling, and isn't buying more. Judge asked why he's not buying given that it might make sense to buy the dip. Weiss pretty honestly answered, "I don't know where the bottom is," a fair answer regarding the most underrated bailout element that nobody talks about, having nothing to do with greed or debt or moral hazard but whether the government, in its obsession that no big banks/automakers fail, ended up saving too many institutions that will forever oversupply their post-2007 markets.

Judge asked Patty Edwards if she likes banks and Edwards said "Not a bit," but reiterated she owns Bank of Montreal because it's not a U.S. bank. Edwards also mentioned Kimberly Clark in Call the Close.

Bank: Fundamentals support News Corp. at $15.50

A fairly quiet edition of The Strategy Session on Monday was marked mostly by disagreement between David Faber and David Bank as to whether News Corp is in free fall.

Bank said the stock's trading as though "the core business of News Corp. is pretty solid, and, you know, like that's it."

Faber responded, "The stock's down 7%; all it's telling me are people are running for the hills."

Bank insisted the fundamentals will support the stock at $15.50 prompting Faber to demand, and get, some actual EPS projections.

Europe’s domino, and
he’s not talking pizza

Monday's Strategy Session figured to get a bang from the return of (tanned) Gary Kaminsky, but a scattering of guests sort of diluted the overall messages.

Kaminsky asserted that once again the credit markets, evidence by Spain's cost of borrowing, usually tend to be ahead of the equities, and that in the last few weeks he would've been more conservative and probably missed some of the rally.

But guest Jacques Cailloux suggested that conservatism might be needed, because now Italy is feeling some pinch despite a better situation than Greece, and "It's likely to go on until we get a pretty serious policy response here."

Cailloux said Europe is in a "domino situation which is pretty powerful."

Aryeh Bourkoff said the News of the World problem is not a game-changer in media, because, "from a financial perspective, newspapers are small."

Bourkoff also said private equity is a sleeping giant especially compared with a few years ago. "The availability of capital is still very much there ... there's about a trillion dollars of private equity capital sitting on the sidelines," he said.

David Barse said there's "an amazing dichotomy of what's going on right now." He likes Weyerhaueser; "it's a play on the long-term turn in the housing cri- in the housing sector." And, he noted, "We're in the business of being optimistic."

David Faber, who noted a couple times that the U.S. 10-year activity does not suggest people fear a U.S. government default, opened the show scanning the heat map wall and observed, "it's hard to find stuff on that wall."

If you paid $747.24 for GOOG, will you ever break even?

This page noted Friday that Patty Edwards expressed doubts about Google shares (the exact term was something like, if you want to buy them, "don't use my money"), then offered something of a qualifier, saying it's been criticized for spending money on initiatives, something that Microsoft has taken criticism for not doing.

This is a very interesting comparison, and a look back is definitely in order.

According to Yahoo finance and Google finance, both MSFT and GOOG enjoyed monster returns in their first 12 months of public trading. MSFT, which went public in March 1986, actually quadrupled in barely over a year.

MSFT was still on fire as of October 1987, when the bottom fell out of Wall Street and MSFT shares. It took a whole 2 years for a new peak, in October 1989, and after that, you see a mostly glorious chart for 11 years, through early 2000.

Google peaked intraday (according to the historical prices) at $747.24 on Nov. 7, 2007. This was around the all-time market peak and when Paul Kedrosky was guesting on Melissa Francis' "On The Money" and shrugging and declaring Google $1,000.

In fact, incredibly, Kedrosky even authored a blog post on this fateful Nov. 7, 2007, dismissing that people were getting "increasingly screwy" about GOOG's price and insisting he was "sticking to my $1,000 GOOG price target" that brought him much "scoffing" after he said it on CNBC.

The point here isn't to make fun of Kedrosky — even though, it's fair to note, his $1,000 comment to Francis at the time sounded a lot like the AMZN/YHOO predictions in 1999 — who knows a lot more about tech than we do and has probably guessed right a lot more often than he's guessed wrong.

The point here is to note that it's been 3½ years since GOOG peaked, and it's still 40% away from that peak. And so there's a question: Is GOOG more like MSFT 1989 ... or MSFT 2004?

Fast Money Halftime Report
handed up to Judge Wapner

It's sort of been telegraphed, but CNBC made official in a staff memo that Melissa Lee is going to host Squawk on the Street starting Monday, with Carl Quintanilla, in a shakeup that raises some questions.

TVNewser says Lee and Quintanilla will "co-anchor" Squawk on the Street. But the article has the CNBC memo from Nik Deogun saying the 2 will "host." Obviously it really just comes down to how much money one's getting and how much airtime/promotion, but titles are something to keep an eye on.

Deogun lists the order of names this way: "I’m pleased to announce that Carl Quintanilla, Melissa Lee, Jim Cramer, Simon Hobbs and David Faber will now all contribute to Squawk on the Street weekday mornings."

Perhaps the biggest winner actually is Judge Scott Wapner, presently listed at CNBC.com as "reporter" but now has officially been handed the reins of the Fast Money Halftime Report as "host," according to Deogun, who credits Judge for an "excellent job." Wapner has a bachelor's in history from the University of South Florida. Lee will continue to host the 5 p.m. Eastern edition of Fast Money.

There's evidently no sea change; no new program creations here or outside hires. But a couple notable things are happening; the Fast Money franchise is now divided among 2 hosts, and there's now an opening on Squawk Box with a "rotating group of anchors filling in."

We've wondered for a while about the future of "Power Lunch," given that it lost 50% of its slot a year ago, in many parts of the country it does not air during lunchtime, and that it is preceded by 2 half-hour programs, which are rare on CNBC, but represent a more specialized variety the network seems to be embracing.

As of this writing there were few reader comments on the TVNewser report, but everyone seems to have an opinion.

Another Fast Money
scorecard

It's really an indicator of nothing, and perhaps nothing more than a waste of time.

(That could refer to Twitter in general, or the following list.)

Every now and then it's worth checking out the Twitter streams of CNBCers (as well as a certain Fox Biz tough guy) just to get a little more clued in on the stuff that doesn't make the cut on-air, for timing or other reasons. (And also to get a few yuks from some of the online arguments with strangers that people allow themselves to get sucked into.)

A quick tally of Twitter account followers this weekend shows that, aside from Cramer, nobody in the Fast Money or CNBC daytime sphere is really lighting it up. In terms of "followers," by the broadest definition, some are even lagging (gasp) this site.

Most notable is that one of our favorites, Mr. C. Gasparino, is actually being quadrupled by his arch-nemesis, Zero Hedge, and also trails David Faber. But even Faber lags Herb Greenberg, who, given his amount of airtime on the network, seems like the most impressive overachiever in this category. Anthony Scaramucci continues to maintain a healthier audience than most despite virtually no tweets in 2 months.

Jim Cramer Twitter followers — 291,556
Darren Rovell Twitter followers — 98,923
Zero Hedge Twitter followers — 31,670
Doug Kass Twitter followers — 23,868
CNBCFastMoney Twitter followers — 21,817
Jon Najarian* Twitter followers — 20,973
Lawrence Kudlow Twitter followers — 16,198
Nicole Lapin Twitter followers — 15,104
Pete Najarian Twitter followers — 13,333
Guy Adami Twitter followers — 12,213
Todd Gordon Twitter followers — 12,131
Joe Terranvoa Twitter followers — 11,411
Maria Bartiromo Twitter followers — 11,260
Barry Ritholtz Twitter followers — 8,975
Herb Greenberg Twitter followers — 8,554
Melissa Francis Twitter followers — 7,333
David Faber Twitter followers — 7,151
Charles Gasparino Twitter followers — 7,017
Peter Schiff Twitter followers — 6,759
Tim Seymour Twitter followers — 6,645
Julia Boorstin Twitter followers — 5,740
Anthony Scaramucci Twitter followers — 5,473
Mandy Twitter followers — 5,271
Jane Wells Twitter followers — 4,655
Brian Kelly Twitter followers — 4,324
Patty Edwards Twitter followers — 4,140
Jon Fortt Twitter followers — 3,833
Gary Kaminsky** Twitter followers — 3,472
Steve Grasso Twitter followers — 3,165
Zachary Karabell Twitter followers — 2,448
Kayla Tausche Twitter followers — 2,269
Kate Kelly Twitter followers — 2,174
Courtney Reagan Twitter followers — 1,968
Rich Ilczyszyn Twitter followers — 1,740
Dan Dicker Twitter followers — 1,140
Judge Wapner Twitter followers — 375
Stephen Weiss Twitter followers — 255

* @optionmonster account
** @CNBCStrategy account

There are some others from CNBC daytime we left out, but you get the drift.

Karen Finerman, Melissa Lee and Steve Cortes don't even have accounts that we're aware of.

There's 140 seconds — or was it minutes? — we'll never get back.

Stephen Weiss:
Booked on United 93

There is stock-picking, and then there are the bigger issues in life.

Stephen Weiss is a Fast Money regular whose commentary and stock picks often get mentioned on this page.

It's been noted on the show that Weiss is also author of The Billion Dollar Mistake, which chronicles career-defining mistakes of famous investors such as Bill Ackman, Leon Cooperman, Kirk Kerkorian and Aubrey McClendon.

What hasn't been mentioned on the show, to our knowledge, is that, according to the book's Web site about the author, Weiss nearly took off on United 93; "was booked on the flight but changed his travel plans at the last minute."

The page also says Weiss was working at the World Financial Center on 9/11.

Overall, our results in life tend to be based on our effort, skills, dedication and sacrifices, things largely seen as within our control. Randomness though is undeniably part of the equation — sometimes, all we can do is be grateful those planes and buildings did not have more people in them and, as William DeVaughn sort of put it, just be thankful for the breaks we got.

[Friday, July 8, 2011]

By the end of the conversation, Patty is making an argument against her Google call

On Friday's Halftime Report, Patty Edwards made one of those grand statements we always love to hear and that are always far too lacking on Fast Money.

The subject was Google's hiring.

"It's nice, it's a great employment factor, although I personally believe that Wall Street's here to make profits, not to create jobs, and if the 2 work together, great," Edwards said. "If you're a long-term Google bull, more power to you, but don't use my money."

(Which means yet again someone expresses skepticism of GOOG without citing the Mark Mahaney reason, which we think is the most important one.)

Zachary Karabell then jumped in to criticize 2 related things; market dissatisfaction with Google's hiring, and Morgan Stanley's downgrade based on uncertain results from Google's ventures into new markets.

The fact that the company is nibbling in new places, "that should say something really positive about the management of the company," Karabell said, and so, "I don't think this is a negative about the management of the company."

He added, "I just don't agree with the call to downgrade a company that is widely planning for its long-term future."

Evidently that was enough to convince Patty Edwards, who elbowed aside Pete Najarian to point out, "You can take the opposite side of it and go, had Microsoft been doing this over time, they wouldn't be in the position they're in today."

Najarian said, "I'd rather be in Baidu right now than Google; I think there is more downside to Google."

‘I was a trifecta in wrongness’

If nothing else, Joe LaVorgna is refreshingly honest.

"I got it wrong across the board. I was a trifecta in wrongness. Payrolls were weak, unemployment went up, and earnings were flat. ... It was a disaster of a report," LaVorgna said on Friday's Fast Money Halftime Report.

Zachary Karabell challenged LaVorgna to identify what would materially change the unemployment situation in either direction. LaVorgna indicated there's not much to worry about on the down side; "job deterioration is unlikely unless the economy rolls over," but that the upside could get a boost from cyclical recovery.

Steve Grasso declared, "This was a terrible employment number; let's- let's not pull any punches here," even though Thomas Lee did just that earlier on The Strategy Session (see below).

Karabell bought AOL Feb. 7

Melissa Lee opened Friday's Fast Money Halftime Report with an update on David Einhorn finally giving up on Yahoo, and the resulting dialogue brought a comment from Zachary Karabell we found noteworthy.

The Zekemeister initially made a good joke, George Gobel-esque, saying, "I don't know if the short Yahoo/long Mets is a pair trade that I would embrace," before offering a media call.

"You wanna be in the new Internet names in China, not the old Internet names in the United States," Karabell said.

That sent us back into the CNBCfix archive for a recollection that Karabell reported liking the America Online-Huffington Post deal Feb. 7. "I actually bought a little bit of AOL this morning on this," he said then.

He qualified his enthusiasm as being based on HuffPost, which we guess counts as new media, and yes, it was 5 months ago, and people are allowed to alter their views. AOL on Feb. 7 was $21.19, closed Friday at $20.53, and this was Karabell's summary in February: "If it isn't viable, then all the naysayers and doomsayers about the death of old media and the difficulty of paying for content are probably gonna be proven right."

What was Ballmer thinking

Patty Edwards, who we think made it a grand slam (man, Denny's sounds good right now) of Fast Money Halftime Report appearances this week, was called on early and often Friday and started by congratulating David Einhorn's Yahoo exit.

"You know, there is just too much murkiness around this story for me to get involved," Edwards said, explaining that when your thesis is broken, the "first sale is the best sale, so I think he made the right choice."

Pete Najarian reminded viewers of a ghastly historical event, saying in 2008, "Microsoft had that $45 billion bid for this company."

"I didn't even know it was still a publicly traded company," cracked Steve Grasso.

Remember the early days when Eric Bolling would crow every day about ‘miners, refiners, and early-bird diners’?

Sometimes the Friday Fast Money Halftime Report should be taken about as seriously as the NFL labor talks, but refreshingly, on a fairly interesting summer Wall Street day, Melissa Lee (in sharp aqua sleeveless, a format where Diana Olick has set the curve) returned to helm a super-crisp, thesis-packed 30 minutes with a panel that clicked.

Steve Grasso opined that there's "soft support" for the S&P at 1,333, and "ultimate support" at 1,325, but he's in the upward camp, saying, "I actually added to a lot of my positions today."

Grasso said "that spread between Brent and WTI still makes the refiners attractive," but Zach Karabell, who's always at the forefront of pointing out which Fast Money subjects have gotten tiresome, sort of wearily noted that oil seems like it's been in a range "for as long as we've been asking the question."

Patty Edwards said, "I own Chevron, I own some Conoco," and also mentioned Halliburton and Schlumberger as names to watch. As the baton got passed, Pete Najarian revealed a position in Halliburton, and also mentioned Western Refining, Valero and XOM.

Karabell said he's skeptical about not foreign car sales, but estimates of U.S. growth. "It's the domestic read, and the expectation of business that I just think, you know, is gonna continually go below what we think," Karabell said.

Patty Edwards recommended AutoZone but wasn't too high on Lowe's or Home Depot.

Patty staying long;
Grasso buying dips

Amelia Bourdeau sadly wasn't on Friday's Fast Money Halftime Report, but Willie Williams was, and Williams offered, "I think that we can continue to see a bit of weakness in the dollar," recommending currency players "buy dollar/Mex at 11.60 with a stop at 11.52, targeting 11.90."

Pete Najarian said EEM put volume is unusually high. Patty Edwards credited Joe Terranova for saying "price is truth" (we think Guy Adami says it more often, but whatever) and said in Italy, "the trend is up on this, not down." Edwards also said, unrelated, that the Pete Najarian household would prefer to have more iPads and less Nokia, which made Pete chuckle heartily.

Zachary Karabell reasserted, "I really don't wanna be in the big financials at all. Period. Right now."

Everyone got a chance to Call the Close. Karabell says the market got a needed pullback and cautioned, "that could continue next week." Edwards, though, said "VIX is not confirming this; I'm staying long into earnings." Steve Grasso concurred with the latter, saying, "I use this weakness to buy stocks; I would add to them right now." Pete Najarian said "I agree with Patty" but he said he would buy rails on a pullback.

Steve Grasso wore the Mark Haines tribute tie.

Not that we’re disagreeing, but Susan Lyne seems to have a fairly high opinion of herself and David Faber

Gilt Groupe Chairman Susan Lyne, who we learned on Friday's Strategy Session was a TV exec as well as CEO of Martha Stewart Living Omnimedia, apparently is one of those pop culture wunderkinds who enjoys being in charge of things.

We checked an extended biography and discovered Lyne is a college dropout who caught on at an ad agency and "never looked back," a sign that some people are just born very comfortable at guessing what people will like and being in charge of things (and quite frankly, while those seem like highly fickle qualifications, they're really kind of underrated).

David Faber as usual opened by asking for an overall economic take and Lyne said "Across the board, people are shopping."

Lyne, who is striking and strikingly dressed as one would expect of someone of her status, described Gilt, her members-only high-end club, to Faber as a "very interesting membership base ... half of them are between 20 and 30, and they're in 1st or 2nd professional jobs, and they aspire to be you, or they aspire to be me." (Actually, if forced, we'd probably say they aspire to be either Karen Finerman or Mandy (tie), and Joe Kernen, but that's neither here nor there.)

"We're imprinting on them early that, that all things are possible."

Is all the money paid to IPO bankers actually worth it?

CNBCfix.com has never underwritten an IPO, and really doesn't have a clue about underwriting an IPO, so consider the source here.

But Kate Kelly's report on Friday's Strategy Session about LivingSocial's plans suddenly hit us with a new-media thunderbolt.

Among its many features, the Internet is supposed to make things easier and more efficient and paper-free.

So we now submit stock orders online, or buy stuff at Amazon without dealing with a human.

(In fact, we even pump our own gas in most states, and that no bearing on the Internet.)

Yet apparently, issuing stock for the first time requires some sort of massive amount of professional human massaging.

Kelly reported Friday that LivingSocial has tapped JPMorgan, Bank of America and Deutsche Bank to front the offering, with an "implied valuation of between 10 billion and $15 billion."

Kelly said GS, MS and Credit Suisse aren't there likely because they're with Groupon — which apparently has so much business to spread around, a couple of the LivingSocial players will get a piece of that too.

Strategy Session viewers have been hearing about this since the days of GM, the Caesars/Harrah's flirtation, LinkedIn, Pandora, the AIG redo, etc.

GM got the most attention, in November, where the "road show" coverage got out of control and even featured Kelly even standing on the sidewalk outside a restaurant where GM executives were urging people to buy the stock.

The bankers are supposedly there to gauge the market and find takers, maybe do a little sales pitch. We can't fathom why. Couldn't a company just call NYSE. Pay for an audit. Be handed a ticker symbol. Post the financial statements and a proxy on the home page. Take bids from people interested in buying the stock. Accept the bids and give them the stock.

If XYZ Widgets wants to go public, surely if we can launch cnbcfix.com, they can launch XYZWidgets.com, post the financials and a prospectus, and take orders. Metropolitan Capital wants a million shares at 46, fine. Trutina Financial is in for 3 million, sold. Brian Kelly Capital wants the mother lode at 8 million? Got it. Or is there a rule that it's not safe to buy IPO shares unless you've wasted lunch money with a banker at one of those restaurants Charles Gasparino always eats at?

Google actually tried a variation of this back in 2004, some kind of Dutch tender or whatever it's called ... it wasn't particularly smooth, because it wasn't what the bigwigs wanted, and so the bigwigs scoffed and carped, "See, this is a sign these guys maybe don't know what they're doing, they're in over their heads," which might've seemed accurate at the time, but probably not less than a year later when the stock had tripled.

Assignment of Kayla Tausche says something about CNBC pecking order

Kayla Tausche got the call this week for CNBC's Sun Valley coverage, which probably means something in the category of jockeying for CNBC assignments/openings in the wake of the former presence of Erin Burnett, Mark Haines and Trish Regan.

Tausche, perhaps getting egged on by the Squawk Box crew early Friday morning, apparently was feelin' it when she dispensed with last names in telling David Faber on Friday's Strategy Session, "We actually met with Eric last night." (That would be the Google CEO chairman, who unfortunately could only offer the most uninteresting soundbite possible as to antitrust concerns.)

Faber then brought in a former News Corp honcho, Kenneth Chandler, who said that one problem with the Murdoch empire in Britain was that David Cameron was too close, and that because of the extent of the skulduggery, "I think unfortunately we've got a lot more to go," including evaluations as to whether Murdoch is a "fit and proper steward" to be running big media.

Honestly, if you're not a consumer of British media, do you really care about this story?

Thankfully, Chandler offered a vote of confidence for American media, saying a News of the World type of situation is unlikely because the British tabloid scene is "so totally different, and so hypercompetitive ... I very much doubt it could happen in this country."

Thomas Lee suggests jobs report not as bad as everyone else says

A lot of people on CNBC Friday (including Steve Grasso on the Fast Money Halftime Report) said not to sugarcoat or pull any punches on the jobs report.

But that's basically what Thomas Lee did on The Strategy Session, saying it was essentially taken the 3rd week of June and was affected by "peak supply chain shock" and rising oil.

Lee didn't care about the report, which we applaud him for basically since it really doesn't matter and the people who were already bullish always keep buying and the people already bearish always keep selling.

Lee, in fact, said right now is very much like 1990, in which we figure to see "very very good cyclical stock performance ... the setup is very similar to today."

"I think this is gonna be a pretty big rally over the summer, um, you know, something like 1,400 in the S&P by August 31," he said, which would bring us near his S&P 1,475 target by year-end.

Bob Pisani said Canada has a 7.4% unemployment rate.

[Thursday, July 7, 2011]

Which gets to $400 first:
AAPL or NFLX?

To think that just a couple months ago, the Fast Money gang mocked James Altucher's $2 trillion prediction for AAPL, while on Thursday, some of them almost sounded like they were endorsing Ticonderoga's $612 price target.

Actually, Joe Terranova said he'd be happy just to see it hit his $413 prediction near year-end (glad we brought that up last week), and Karen Finerman asserted, "You don't (have to) think they get to 600, and still have it be a great investment of course."

But even Terranova asked seriously, "You put Apple at 600 bucks, where does that take the Nasdaq?"

Tim Seymour said people think there's $200 worth of China exposure available to AAPL but he thinks that's a reach, saying China Mobile's 4G is "not a global standard," and "A lot of people think that this is a technology issue for China Mobile before they can actually adopt the current form of the iPhone.

(And remember not too long ago when everyone on Fast Money claimed their own particular gadget stock was going to continue to do well because "the cell-phone pie (or was that the 'rising tide'?) is big enough for more than one player"?)

Seymour said nevertheless it's a "fantastic time" for AAPL, while Terranova said "the Mac is beginning to penetrate the enterprise space," while Jon Najarian gushed about "phenomenal" app sales at the Apple store.

Melissa Lee, back after a long break in very impressive white skirt/olive top combo (although we have to admit, Diana Olick set the curve yesterday in sleeveless/short-short sleeve), then introduced cautionary Netflix watcher Tony Wible in a segment that, completely opposite the AAPL talk, seemed to feature a stock that found no enthusiastic takers.

Wible shrugged off the Latin America developments, complaining "all that market is 3 countries" in which Netflix will compete with cable movies.

Tim Seymour tried to trumpet looming competition from Google and/or Hulu, and even long-term Netflix liker Jon Najarian made a speech suggesting this may be the end of a rip that's worth waiting to buy again.

Wible might as well have said investors are "kicking the can down the road" when he observed that, "it's a stock that's trading after technicals and momentum, but at the end of the day a lot of that stuff ultimately will eventually come back to fundamentals." (Actually, it's not so much "momentum," but what some people see as a new paradigm in the early stages.)

Joe Terranova asked Wible, "The question would be, at what point do you acknowledge that maybe you're doing something wrong in the model to be so below the actual market price of the stock."

Wible insisted, "We've actually been one of the analysts that's been most accurate on the earnings," which prompted Terranova to wonder if the earnings coming up are good, wouldn't he be raising the target, and Wible's answer about maybe the earnings won't be so good because of expansion costs only made Terranova roll his eyes.

Dunno. The gut feeling here is that when everyone is gushing AAPL and others are questioning NFLX's gains, there's maybe a greater chance of NFLX catching AAPL in a hurry than people might think. (In fact, this page predicts the 2 will meet within 12 months, though we're not going to guess at which price.)

Which valuation is more ‘absurd,’ Google or Facebook?

About the only people on Fast Money who think AAPL's chart is headed for trouble are Guy Adami and Steve Cortes, and neither was around Thursday, so the opening 8 minutes of Fast Money served as an AAPL-led lovefest.

"The holy grail of tech was being traded aggressively today, from the long side," gushed Jon Najarian (or is that Dr. Evil? Looks like it'll take Mel Lee some time to adjust to Judge Wapner's terminology).

Joe Terranova singled out SKYY, the cloud ETF; "I think this is a great way to play potential cloud M&A targets."

Karen Finerman even said a name like CSCO went from "extremely undervalued to undervalued."

Later, the optimism continued, in a go-round on IBM and specifically Jason Maynard's Halftime commentary.

"I don't agree with his characterization that it's only 1 multiple point more expensive than Apple," Finerman said. "IBM doesn't have the balance sheet that Apple does, when you back out the cash from Apple's balance sheet, Apple is meaningfully cheaper."

Joe Terranova said GOOG has kick-started itself to the point people might think about moving into it from IBM. Finerman said the "valuation has gotten absurd" for GOOG.

Terranova likened Facebook and Google to the Yankees and Red Sox; "the competition just makes both of them better and better and better."

Except we wonder how much enthusiasm there will be for GOOG shares and how "absurd" the valuation will be once Facebook is publicly available, and we also wonder why no one mentions the potential of a profound sea change in search that the extremely reliable Mark Mahaney brought up recently.

We've said from time to time that Jon Najarian might be the most well-spoken person on CNBC (at least when he's not gushing about "I BUY THE RIPS AND I SELL THE DIPS AND I JUST HAD THE GREATEST 3 DAYS OF THE YEAR!!!!"), and he might've proved it Thursday with a very fair and eloquent statement that Maynard sounds like he might be making the same mistake as a lot of amateur investors, cashing in on a winner well before it's time. "I see a lot more upside for IBM," Najarian said.

Human beings: More prosperous when the weather’s nicer

We noted at Halftime Thursday that Patty Edwards was crediting the weather for improving retailers' results, and that notion was seconded on the 5 p.m. show by Joe Feldman, who we learned is in the Telsey Group.

"The weather finally got better," was one of Feldman's arguments as to why things are looking good for retailers, and he said he likes Target even after the bounce; "these guys are setting up very well."

We thought it was interesting that, late in the program, the screen text said Coach, Nike, Tiffany, Polo all hit record highs, when barely a month ago, Steve Cortes claimed "high-priced apparel is not gonna last."

Joe Terranova revealed, "I did sell half of my Lululemon today on the close."

Tim Seymour recommended SCCO as a higher-beta play in copper. Jon Najarian concurred, saying with SCCO, you "get a lot of bang for your buck" as opposed to FCX, but "there's some room to move on both of these." He also delivered a shout-out to Zachary Karabell, "kudos to Zeke."

Tim Freeman seemed to spend an awfully long amount of time saying the "VIX seemed to bottom here." Greg McBride spoke about (Zzzzz) the debt ceiling but thankfully didn't kick any cans (see, all you have to do to sound like Nouriel Roubini is go on CNBC and complain that some government somewhere is going to or already has opted to kick the can down the road).

Joe Terranova said he thinks GS gets to $145 before $125.

Tim Seymour is trying a new twist on the new 'do every day, and we're afraid it's just barely starting to trend a bit away from Richie Cunningham and toward Lyle Lovett.

Consider thanking
your weatherman

He was only 4th in the pecking order on Thursday's Halftime Report, but Zachary Karabell deadpanned the line of the week in regard to the fickle nature of stock investing.

Karabell told Judge Wapner, "You know, it seems like 3 weeks ago, I was considering alternate professions, and now I guess we're, we're all geniuses," Karabell said, saying he's "long some" and "enjoying the ride" right now but surprised there hasn't been a pullback this week and warning that markets don't go up in a straight line (which we interpret as possibly meaning "not quite as long right now as I wish I'd been for the last 2 weeks").

(We wish we had been a LOT longer LULU, but Liz Dunn and Steve Cortes squelched that.)

Patty Edwards, who perhaps is now on the Halftime Report every day but had a minor hiccup recently on the Tatum O'Neal-youngest-Oscar question, actually got to go 3rd this time, but didn't manage to produce any trades in 2 brief stints of questions from Judge Wapner.

"I am actually fully invested" but if not would buy more, Edwards said, saying, "I think that it will go farther."

Judge also asked Patty what's fueling the retailers. "Couple of things going on," Patty said, saying gasoline prices are off 8.5% since the peak, and, in the argument that always made Jeff Macke bristle, that retailers "have the benefit of much better weather."

Edwards added a 3rd thing, that retailers are "also discounting" to clear up the shelves for late summer/autumn, and "a lot of pent-up demand that came out."

Edwards did actually name a stock in Call the Close, "long TAL."

Steve Grasso hailed his own rightfully good call on ANF and said "watch 75, 77."

Zachary Karabell downplayed lingering impact from oil on retailers. "The thing that really disrupts consumer spending patterns is a rapid change in the price up," he said.

Dan Dicker says he made his career by being ‘wrong’

Oil trader Dan Dicker, perhaps slightly frustrated, told Judge Scott Wapner on Thursday's Halftime, "I think this is a bull trap Scott."

Then he said something that really raised eyebrows here.

We think Dicker said, "I've made a career out of being wrong going against Goldman Sachs and Morgan Stanley."

At first we were sure it had to be "long," and not "wrong." But the closed-captioning indicated it was "wrong."

Then we re-listened to the rest of his comments, in which he explained he doesn't mind shorting daily and covering a dollar off, because one of these days the short will be right and it'll drop $4, and we decided the comment really was "wrong," in the sense that, Dicker plays contrarian to the GS and MS calls and maybe loses in the short-term but ultimately makes a career out of it.

Which is, presumably, what Steve Cortes and Liz Dunn are planning to do with LULU.

Steve Grasso thankfully avoided kicking the can, saying of the stock market, "We got Greece sort of out of the way; no one says we've solved it." He said 1,361 is the next big level.
Grasso also said the debt ceiling talk "can't be priced in" because no one knows for sure what will happen, but that, "if we get something today, I think the market rips to that 1,361 level."

Grasso spoke briefly about banks and their prospects for recovery. "I'm still long Bank America (sic), Citigroup and JPMorgan," he said.

But Zach Karabell, who has been way ahead of the curve on this one though we're not sure if it's ultimately correct even though it mirrors our current view that the TARP bailout protected a lot of banks that there really isn't enough business for, said banks are merely in the "middle of a long transition of the financials as a percentage of the S&P and a percentage of the economy contracting." He predicted they're going to be "lower margin ... sleepier businesses."

Dr. J hinted a tiny bit at Brag Trade land, telling Wapner, "Luckily I'm long and still holding on here Judge." Najarian also said Meredith Whitney is never positive on anything, but her positive call on V is "ringing the bell in Visa today ... and that stock's off to the races." (Actually, she's been bullish on V at least since May 2010.)

Steve Grasso avoided kicking the can down the road but did wearily refer to the "whole vertical integration" of AAPL, which we think was priced into the shares 3 or 4 years ago. Jason Maynard defended his negative call on IBM, saying, "I think you need a little bit of a pullback here."

He didn’t get into high-frequency trading, but he did bring up lingerie

We've been wondering this week if The Strategy Session was going to put together a show that would have Gary Kaminsky champing at the bit on his vacation to be back there.

That definitely didn't happen Tuesday-Wednesday, but maybe Dick Grasso would've turned the tide on Thursday. (If nothing else, the show had to be watched by C. Gasparino.)

Grasso joined David Faber for a fairly short chat about the exchange world. This was one where a 2nd interviewer would've helped, as Faber's questions were too predictable and deferential and delivered nothing more than cliches (though thankfully, Grasso didn't say the Nasdaq is kicking the can down the road).

Grasso said the NYSE Euronext deal "represents the future," not exactly a surprising response there, before launching into talking points. He said if Deutsch Boerse "loses a phenomenal opportunity" if it rejects the deal; "they'd be nuts not to do it."

He painted a scenario of a dwindling number of exchanges amassed into a few global giants and warned about resisting that. "I was surprised frankly at the reaction of Toronto shareholders to not affiliating with London," Grasso said, calling that a "mistake ... they need to be part of something larger."

Faber asked Grasso to give the Nasdaq some advice. "At this point I'd be looking to APAC," Grasso said, citing an Asian toehold as an "enormous strategic advantage to completing the puzzle."

He warned that without it, "Nasdaq could be the odd horse out here."

Faber didn't ask about the famous pay package, whether Grasso was glad to get out before 2008 or whether the White House is too harsh on Wall Street. Nor did he ask about high-frequency trading or trader speculation in commodities or, in a curious omission given it was the topic in an earlier chat on the show Thursday with a different guest (see below), the emergence and outlook of these private placement stock markets that Facebook is now successfully toying around with.

Grasso did lament old — in decades ago — decisions. "If I could turn the clock back to 1970, I wouldn't give away, as the New York Stock Exchange did, depository and clearance and settlement. We just gave it away. And that's a very valuable business," he said.

He also backed Ray Kelly as New York City's next mayor, something he's been doing for a while.

Grasso did say something entertaining, regarding the too-predictable question about the NYSE-Deutsche Boerse name. He said a lot of people might not know what Limited Brands is, but they do know what Victoria's Secret is, and that the new NYSE Euronext/Deutsche Boerse corporate name won't matter as long as the parts have their identity.

Facebook: First stock in history to peak before going public?

Guest Lou Kerner explained on Thursday's Strategy Session how Facebook gets to $100 billion.

Kerner said people aren't buying it for its revenues now, but in 2015, where he sees $11 billion EBITDA, 40% growth, a 20x multiple, and thus $220 billion 2015, which is discounted to "$100 billion today."

That seems to add up too neatly.

Kerner said Facebook's potential isn't being overestimated. "In fact, it's behind the growth that Google experienced during in its early years ... monetization systems weren't as mature as they are today," he said.

David Faber said it's now being traded in that "weird private market."

Faber also, at the top of the show, reported that he's hearing chunks of Facebook are for sale on that "weird" market, including a 5 million-share bloc "being shopped at $35, while I'm told another 4 million shares have been for sale at around 33.50."

He said prices in that range would indicate an $84 billion valuation.

Faber indicated the gains have been so big so far that even "one institution that bought into Facebook some time back is now also looking to get out."

Faber rattled off the day's market stats but finished with, "as everybody knows, I really don't care about the Dow." He also said Gary Kaminsky is parasailing.

The secret to coming out ahead in the hedge fund world

Kate Kelly was on The Strategy Session Thursday to talk about a "pretty rough month in June" for many hedge funds, starting with Paulson Advantage Fund, which she said "is down roughly 15% this year."

She said Louis Bacon's fund iwa down a "less dramatic 3%" and 5% for the year, while Third Points Offshore Fund was down 3% in June but up 7% for the year.

She said Brevan Howard was down 1% in June and 3% ytd, while SAC Capital was flat in June and is up 9% on the year.

Kelly described the winners this way: "People who have picked the right stocks. You know what I mean."

We're not into high-yield corporate bonds, but Faber and Jeff Peskind put together a snappy, interesting look at 3 of Peskin's picks (after Faber, who has the best on-air comments about glitchy camerawork at CNBC, hilariously noted the angle was showing too much of his nose).

Peskind, Phoenix Investment Adviser CIO, touted 3 CCC issues with 2015 maturities that he said will be the "least sensitive" to setbacks if rates rise (as opposed to investment grade), including Rite Aid, with 8.625% coupon and 9.25% yield, ATPG, with 11.875% coupon and 11.875% yield, and Clear Channel, with a 10.75% coupon and 13.50% yield.

CNBC's Guy Johnson reported briefly from London on a big boost for the human race, the demise of News of the World. "This story David has taken on a new momentum," Johnson told Faber.

[Wednesday, July 6, 2011]

Bailouts’ hidden gems

We sometimes complain (correctly) that not enough exciting things are said on Fast Money, but Tim Seymour — who, let's face it, has basically never met an automaker he disliked — helped to seriously put a dent in that deficit on Wednesday's Fast Money.

Fiat, according to Seymour, has "stolen Chrysler from the U.S. government."

You know what (and there are indeed many fine workers at Chrysler and we do wish them the best), we're willing to chalk up that one as a victimless crime.

Gartman: All the PIIGS going bankrupt within 18 months

Dennis Gartman told a weary Judge Scott Wapner on Wednesday's Fast Money that the Greece-like stumbles in Europe are "going to go on until all of them have gone bankrupt."

"Who are 'all of them' Dennis?" Tim Seymour immediately wanted to know.

"All of them are the PIIGS. They're all going to go eventually," Gartman said.

(Sure Dennis. But what if they all kick the can down the road?)

Stephen Weiss asked for a time frame. "Sometime in the next year and a half," Gartman said, while Jon Najarian agreed with the outcome but said it would be 3 to 5 years.

Judge Wapner pressed Gartman for a call on the euro. "I bet we're trading under 140 in the not-too-distant future," Gartman said.

Jon Najarian helpfully offered that people who think the euro's going down can try the EUO, which is the "double-inverse euro," and for whatever reason, man, does that sound like a crazy thing to dabble in.

Gartman also managed to tell a story about New Zealand that he evidently hopes serves as a parable to U.S. politics. Gartman said that 20 years ago finance chief Roger Douglas embarked on a tax-cut mission, which boosted national revenues, and by the time "Barbara" Richardson took over (according to Wikipedia, her name is actually "Ruth," and it's surprising that Gartman would botch that part of it, given that her critics cleverly referred to her policies as "Ruthanasia"), Richardson said, "I can't cut them anymore because I can't spend the money that I'm taking in now."

Gartman said, "Which is extraordinary thinking; Democrats have never figured that out," and whether intentionally or not, that last line was basically cut off by Judge Wapner as he asked about the euro.

Diana Olick goes sleeveless,
for good reason

(Note to self: Avoid getting into a bar fight with Diana Olick.)

This entry is somewhat obligatory, because there's a senior member of the CNBCfix community, a very modest and low-key person we should add, who (somehow) basically had no use for Trish Regan but can never stop talking about Diana Olick.

Olick, it turns out, was on Fast Money Wednesday, possibly the first time she's ever appeared on the show. (Terrible we don't know that for certain, but the show's into its 4th year — 5th if you count its early infrequent days — and it's possible she's done a Fast Money report here or there that we've forgotten about.)

Olick spoke from a backyard that, to be honest, in our view, seemed to have just a lot of extra contraptions, but which Olick explained are ways that homeowners on the upper end of the scale are staying refreshed in a market in which it's difficult to move and most of the interior renovation was done several years ago.

But the highlight was Diana's staggeringly tight physique that would put Brandi Chastain to shame (do you see that left bicep?? holy moly ... ) and the pair of guns she used to point out the surroundings with a natural ease that could've made her one of Barker's Beauties on "The Price is Right" back in the day.

"Once again, you take it outside," Olick concluded with a flourish, and it was a lovely segment.

Oddsmakers might call
MSFT a 1-point underdog

Fast Money traders on Wednesday spent the show's initial moments gushing about MSFT in a way that was almost borderline comical, kind of like if Diana Olick and Karen Finerman and Patty Edwards and Jane Wells were gushing about Willie Aames' prospects for seizing the lead role in "Two and a Half Men."

"I think this is a great deal," said Jon Najarian, of whatever it is Skype is going to do with those 750 million Facebook users (it appears nobody will get suspicious about that number of accounts until the number hits 7 billion).

Steve Grasso supplied the reality check on MSFT-as-Facebook-play, saying it "still can't get over that 27½ range.

Dr. J then sort of tried to downplay his enthusiasm for MSFT, saying someone looking for more instant pop should check out a name like AKAM instead.

Grasso, undeterred, said of MSFT, "This is usually where the retail investor gets sucked in and buys it, and you see the stock come back in."

We wouldn’t say he’s wrong, only that we’re not sure what ‘recent history’ he’s citing

Jim Iuorio, who in the recent past has had to fend off subtle critics such as JJ Kinahan and Mike Khouw when declaring his options strategies on Fast Money, actually on Wednesday openly invited someone to tell him he was wrong, and nobody did.

Iuorio was explaining, with some degree of incredulity, how low volatility had gotten, and that it couldn't go to zero (which elicited the Achilles heel of Judge Scott Wapner, his propensity to over-aggressively interrupt someone who hasn't yet merited interrupting), and that the complacency seems to stem from belief that the government has been watching over the markets for a couple of years like a samaritan.

In fact, Iuorio said, "recent history has told us that government involvement in asset prices is the thing that leads to dramatic and massive volatility ... Am I wrong about this guys? ... Am I crazy here?"

Judge, helpfully, said Joe Terranova (off-camera) was making faces. Terranova went on to say he had a bad personal experience with that trade in 2006, when he "lost a heckuva lot of money" thinking the VIX was cheap and it only got cheaper.

Iuorio said to play that by shorting the VXX, which he said he would short but would not go long because of its limitations.

Tim Seymour felt compelled to chime in, saying, "Selling volatility here to me seems like picking up nickels in front of a steamroller ... the risk/reward is not in your favor."

Eventually Iuorio delivered his trade, which was to sell Aug 47 puts in Raytheon and to "buy the August 50/52.5 call spread," which costs 40 cents for the whole package.

LULU is up $25 since Liz Dunn downgraded it

Incredibly, just about every day is a valid day for pointing out the worst Fast Money trade we've heard in months.

That would be the Liz Dunn/Steve Cortes May 26 team-up on LULU, in which Dunn incredibly downgraded the stock, which sent it plunging from $97 to $91, and Cortes said he'd be looking to short it around the low-$90s level it was trading at then, because "high-priced apparel is not gonna last."

Whatever the reason why LULU has soared, it's an absolute monster, and somehow the Fast Money gang with the exception of Joe Terranova and occasionally Jon Najarian would much prefer to talk about how "cheap" HPQ and JPM are rather than a dynamite stock that is absolutely blowing it out of the water for 2 years running. On Wednesday, Najarian said he expects movement in LULU and AEO, and Terranova said the stop for LULU longs should be "somewhere around 115 on the long side."

Yes, it's true that LULU traded under $91 for about 2 weeks after Cortes' call. If you made some small cash shorting it and managed to get out, more power to you. It's suddenly $30 higher. Given his rationale, this lunk-headed, bone-headed call is already in the pole position for Fast Money's worst of 2011.

Najarian: Netflix has much of the content ‘locked up’

One thing we do like about Dr. J, Jon Najarian, is that he seems to pay no attention to what might be the greatest red herring in economic history, which would be P.E. ratio.

(Unfortunately, for reasons we can't begin to fathom, a seasoned pro like Karen Finerman seems to care about nothing except P.E., but whatever.)

P.E. has about as much predictive value as to a stock's direction as last week's time of possession does in predicting the winner of this weekend's football game (assuming, of course, there is a game and no labor stoppage).

The truth is that the stocks with high P.E.s are stocks with stories, which tend to draw more share-buying interest than stocks with no stories.

Najarian has pounded the table, occasionally though not every week, for Reed Hastings and the Netflix story, regardless of whether Len Brecken or Whitney Tilson is shorting or Karen Finerman is whining, "oh, the P.E. fell today to 275 ..."

On Wednesday, Najarian asserted that NFLX enjoys a "walled garden" of the content it has purchased. So even if Google or Hulu or whatever tries to get into the space, "The stuff's already locked up, and pretty soon there won't be much left."

The topic was actually whether some company would try to buy Netflix. Stephen Weiss had a theory; "I think the actual, most likely buyer for Netflix, if there is one, is Google," and that one would probably go over well in the antitrust reviews, but if nothing else, the companies do have privacy concerns in common.

Guest Keith McCullough, on the Fast Line, spoke of the pain of shorting NFLX and said he tends to view the earnings reports as more of a liability. Somehow that conversation morphed into a discussion of global macro-ness, with Tim Seymour demanding to know what changed in the world between mid-June and the last week of June when, if Greece is the cure, "everybody here tonight says we kicked down the road" (he didn't say "can"). McCullough said the Street was wrong beforehand.

Stephen Weiss apologizes
for owning JPMorgan

Stephen Weiss said on Wednesday's Fast Money that he likes regional banks because "they're gonna have the urge to merge," and he mentioned Comerica.

In an interesting, refreshing opposite of a Brag Trade, Weiss revealed, "I own JPMorgan. I'm sorry I do. I wouldn't buy more."

Steve Grasso, somehow billed as being at a "Prop Desk" while just standing upstairs at the home of his archrival the Nasdaq, offered, without barely a trace of any enthusiasm, "Once we get past the debt-ceiling debate in, in August, I believe the financials will probably move a little bit higher."

No. 386 also said he likes F over GM. He also said he likes Marriott ahead of its spinoff of its time-share division (which might make Marriott the first entity to get rid of a time share for more than it paid).

Interesting that the whole world is talking about Casey Anthony, and nobody on Fast Money has said a word.

Joe Terranova suggested MON as a play on the Diana Olick muscle trade, then courteously thanked Judge Wapner for hosting Fast Money, which we take as a sign Melissa Lee will be back for the 5 p.m. show on Thursday.

Don’t expect Arab Spring in Beijing

China watcher David Riedel said on Wednesday's Fast Money Halftime Report that China fears are being mispriced.

"I think they're coming in for a controlled landing; it's gonna be a nice soft landing," Riedel told Judge Scott Wapner.

Riedel went on to say that one thing that's "on China's side" for adequately managing its economy is "a compliant population that'll do what you say," and if that doesn't make you a bit queasy about buying SINA, well ...

Patty Edwards, whose chic new hairstyle didn't improve her ranking in being called on by the Fast Money Halftime Report host (4th again, this time around the 8-minute mark), revealed that "Yesterday I picked up Lincoln Electric," in part on assumptions of a soft landing in China.

Judge Wapner’s comedic skills lacking, sounds too much like stiff TV guy in reporting Aniston-Gross humor

Stephen Weiss, fresh off a mild confrontation a day earlier with Mike Olson, who didn't seem interested in confronting, over Netflix, that actually didn't make a whole lot of sense from Weiss' standpoint, bickered Wednesday at Halftime with Brian Kelly over the euro, which Weiss claimed is "levitating at a level that it can't stay at."

Kelly protested that there's a 2% inflation cap that requires Trichet raising rates, but Weiss countered, "that's a judgment call."

Weiss said he's interested in names such as Navistar, Cummins and Paccar, as well as Verizon and MLPs.

Weiss said the XLF's chart is "not a great sign," but he's "hanging onto the regionals."

Pete Najarian said Halliburton is hot; "August 55 calls right out of the gate Judge they started buying these."

Brian Kelly was unfazed by WLT's stumble. "I still like this name; I'd buy it," Kelly said.

Patty Edwards mentioned BlackRock Kelso as a name that can do some lending that big banks can't/won't. Edwards said WAG results indicates non-pharmacy strength that "bodes well for tomorrow morning." Edwards also said, "I like Philip Morris."

As we continue to piece together the Fast Money gang's musical preferences, a major obstacle was overcome Wednesday when Pete Najarian's phone rang during the Halftime Report and Judge Scott Wapner revealed it was ringing "Sweet Child O'Mine." Which means our earlier guesswork of Van Halen, which evidently raised a few eyebrows, was likely not far off the mark, if even off the mark at all.

Judge Wapner tried to make a joke about "Grossifer."

Analyst: Netflix’s potential biggest victim, and threat, is HBO

"Quiet" barely begins to describe Wednesday's Strategy Session, but media analyst David Bank did his best to pump some life into the media-stock story.

Bank said the biggest reason stocks such as Viacom and CBS have enjoyed such phenomenal-looking charts is because "these guys have taken their foot off the gas pedal of deals," which bank called a "very positive development."

David Faber asked Bank if HBO isn't facing a major threat from Netflix. Bank conceded that but said it works both ways. "If anybody is vulnerable, probably HBO is most vulnerable; on the other hand though who has a better opportunity of going up against them than HBO," Bank said.

Guest co-host Scott Rechler (Gary Kaminsky "continues to burn his flesh in the bright sun of the Caribbean," according to David Faber) said REITs are now back to a "16 times FFO multiple; that goes back to 2007, the all-time peak."

But he told David Faber it might not be a bubble, because, "We're coming off a trough in the economy."

Guest David Mussafer says that while he looks for great mid-size companies in Western Europe, he's actually looking for specific opportunities and that one can't paint the whole continent as the same; that would be like comparing Nevada to Michigan or Michigan to Massachusetts.

Mark Okada offered, "We're gonna continue to have this volatility ... what's really working though is contractual-based asset classes vs. valuation-based asset classes."

[Tuesday, July 5, 2011]

Stephen Weiss complains that an analyst’s price target is too low on a stock Weiss doesn’t like

The interview that Scott Judge Wapner put together with Netflix analyst Mike Olson on Tuesday's Fast Money had more holes in it than the case against Dominique Strauss-Kahn.

Judge introduced the segment practically scoffing at Olson's 10% price target upgrade, then somehow during several minutes of coverage managed to leave out 3 crucial details: 1) What the new target is; 2) Whether the 10% was an upgrade from Friday's closing price or Tuesday's closing price; and 3) whether this upgrade is what boosted the stock Tuesday.

For that, we had to go to Barron's, which says Olson raised his target from $280 to $305 (that's actually 8.9%), and that he did it "after the company this morning announced" its Latin America expansion.

Not only did Judge bungle this, but things turned downright goofy when Stephen Weiss barged in to chide Olson for not going all-in.

"You're hoping the hook is gonna be Latin America, which has nowhere near the Internet penetration that Canada has," Weiss said. "Don't you think that investors should be selling not buying? Any scot- stock has 10% upside, no less one that's trading at 66 times. It just seems like kind of a weak call."

Olson, a picture of stoicism throughout (and quite frankly, Olson exhibited about as much enthusiasm for this interview as people do while pumping gas, so we question if he'll be on again in the near future), said there are 40 million broadband subscribers in Latin America vs. only 10 million in Canada.

Pete Najarian then jumped in to defend Olson for constantly being bullish on the stock; "I think we've gotta give kudos to Mike at this point," Pete said.

Weiss wouldn't give up, saying, "It seems to me at this point, you're following rather than leading."

Incredibly, for his Final Trade, Weiss said he finds the "risk/reward very unattractive" in NFLX.

So (scratching the head, as dumbfounded as anyone else) ... an analyst who consistently has been correct in a controversial stock upgraded 8.9%, which essentially matched Tuesday's jump and leaves room for 5.5% more gain.

Weiss, though, complains this analyst is a "follower" rather than a leader for not raising the target higher ... even though Weiss himself thinks the risk/reward in the stock is "very unattractive."

What in the world does Weiss want, a Liz Dunn LULU call???

Mike Khouw complained too, that Olson hadn't explained what would change his thesis, and Judge Wapner demanded Olson answer.

"I think the bottom line is you'd wanna look at, you know, any new competitors entering the space that actually have some real push behind them. We haven't seen that yet," Olson said.

Judge then blurted out "Google!"

"They do, but not in the subscription video space as of yet," Olson said.

James Altucher: ‘Economy was already fine’ before the stimulus

James Altucher is an articulate person and TV guest, but given that his appearance on Tuesday's Fast Money amounted to nothing more than a rehash of his last appearance, we had to wonder who ordered this segment up.

Judge Scott Wapner opted to try to freshen up the topic by asking Altucher if bubbles lurk in our midst.

"Where's the bubble, I don't see it," said Altucher, citing "24 straight months in a row (redundancy sic) of redemptions from mutual funds" and AAPL trading at 12 times earnings and COP trading at 4 times cash flow.

Stephen Weiss, in a dissing mode obviously Tuesday, said he remembered something about Altucher predicting something like Dow 30,000.

Altucher explained it's really Dow 20,000, at or near, in the next 18 months. "It takes 6 to 18 months for federal stimulus to actually reach down into the hands of the consumers," Altucher said.

Judge Wapner declared there are signs of inflation starting to heat up, which Altucher flatly rejected. "Housing prices are basically the same as they were a year ago," he said, insisting things were really never that bad.

"I think this is, they put in too much stimulus. The economy was already fine. Maybe not great. But it was fine," Altucher said.

Who do you think Alexandra Lebenthal is talking about?

Alexandra Lebenthal said on Tuesday's Fast Money the surge in munis was bound to happen given who's been on the other side of the trade.

"It's actually the best quarter since 1999," Lebenthal said, "due to some ill-advised information."

"What happened was that you had predictions of major doom and gloom by somebody who was seen as an expert in other market areas who caused people to panic and run for the doors. I mean, when you yell 'Fire' in a crowded theater, people run."

Judge Scott Wapner mentioned the offending analyst by name but backpedaled, saying, "She's not here to defend herself." Lebenthal said the analyst would be on tomorrow.

Brian Kelly courageously revealed, "I am short MUB."

Lebenthal said, "Actually, I might think about covering your short soon," because governments have "taken very draconian steps" to get their finances in order.

Brian, Pete like silver

Rarely a day goes by, for 4 years now, where someone on Fast Money doesn't recommend the ag trade.

You know, so many more people in the world who need food and who especially in the BRICs once they get a taste of meat diets can't bear to go back, etc.

Tuesday was Brian Kelly's turn to do the honors. "The way to play this though I think is through the fertilizers," Kelly said, naming POT, IPI and MOS. "I still like the Andersons as well ... I am long."

Tim Seymour pronounced the oil situation this way: "Get used to 4.50 gas, because I think that's where we are."

But Seymour also pointed to Italian credit swaps and mentioned STD and DB; "those are names to short."

The camera likes Amelia Bourdeau, and the camera gave viewers plenty of Amelia Bourdeau on Tuesday's Fast Money (while an old guy in Times Square smiled and waved into the Fast Money camera). Bourdeau said, "I would be short euro/kiwi on a break of 174. I look for it to move down to 170 ... and I put a stop at 176.50."

Anthony Scaramucci didn't have a Hedge Fund Trade of the Week, but he did say, "Look for the hedge funds to be trading in and out of the commodities," because they've been sold on fears of a slowdown but have some kind of floor because they remain the "best spring-loaded asset appreciation if you will."

Scaramucci also saw strength in "credit-sensitive MBS, which got crushed last quarter, look to see those guys do well."

Brian Kelly recommended SLV for his Final Trade and Pete Najarian seconded that with SLW. Mike Khouw said he was leaning long CVS. Tim Seymour said it's time to take profits in EEM till it gets back to 46. Joe Terranova stood by AAPL and his $400 prediction.

Judge Wapner fails to dispense with the formalities

Scott Judge Wapner on Tuesday's Fast Money asked Brian Kelly about oil and the SPR release.

Kelly said nobody thought the SPR release would work, but "there are other levers that could be pulled," including, unbelievably, "perhaps even the Pickens plan."

"Doesn't it seem a formality at this point; $100 seems a formality," said Judge Wapner.

"What do you mean a formality, I don't understand, that doesn't make sense," Kelly responded.

After an uncomfortable pause, Wapner, continued, "OK, you don't think crude's going to a hundred."

"Yeah, but I said that could be the top," Kelly said, leading to another uncomfortable pause before someone said Kelly is getting "feisty."

This page —
ahead of the news

Over the weekend, we were looking up some old Fast Money calls and found some interesting predictions from 8 months ago about where AAPL would be in 12 months.

Little did we know one of those predictions was going to be resuscitated on Tuesday's Fast Money Halftime Report.

Joe Terranova told Scott Judge Wapner, "I stand by my 413 call for Apple; I think Apple in the second half of this year goes above 400."

So, we should post them again:

Guy Adami — $285
Joe Terranova — $413
Karen Finerman — $360
Tim Seymour — $361
Patty Edwards — $375

The gut here is that $400 will prove too much for Apple based on its catalysts/lack of catalysts for this fall compared with recent years.

But given the time left, Terranova could well leave the others in the dust.

Fast Money Halftime airtime spent on subject no one knows anything about

Dennis Gartman did a remote home-office appearance on Tuesday's Fast Money like Daniel Fisher normally does, only Gartman was caught in so many delayed interruptions/counterpoints from Judge Wapner that it seemed to be hardly worth the trouble.

Judge asked Gartman, who has a golf ball prominently displayed on his bookcase (our guess is that it's his first birdie, or maybe first eagle, or perhaps even a hole-in-one if he's made one), to explain the S&P's goofy Greece analysis.

"You probably know as much about a selective default as I do," Gartman said.

"I don't know that anybody knows anything about it," Judge said.

The discussion floated to the euro, and Gartman made the tedious point that "technically it's beginning to show some signs of weakness," which also brought a rebuttal from Judge, "Couldn't you have said that last week."

Brian Kelly said he's "still long the euro, and I still will hold long the euro."

Dr. J: ‘Netflix story is as real as it has ever been’

Jon Najarian hasn't talked about this one enough, but he's left his Fast Money colleagues in the dust on Netflix, given that he's the only one who semi-regularly touts the stock while Guy Adami wrings his hands and says "a month from now it could be $100 higher or $100 lower" or something like that.

Najarian said on Tuesday's Halftime, "I think the Netflix story is as real as it has ever been," and even managed to slightly dis Whitney Tilson who actually on his exit admitted there were some reasons the stock might continue to rise, but curiously Dr. J had to go up against not another trader, but Herb Greenberg of all people, who got the chair next to Judge Wapner.

"This growth isn't gonna come free," said Greenberg, who defended Tilson to the extent he publicly got out of his NFLX short many months ago. "They gotta make the money on a consistent basis; the margins can't keep going down," Greenberg said.

It was 5 minutes into the show when Patty Edwards got called on, and the result was a generic analysis of companies not hiring but turning to productivity gains in technology.

"They're going to invest in technology ... that buildout is going to, going to continue, I mean, that's, that's the trade at this point," Edwards said.

Brian Kelly had a much better soundbite. "I'm long XLK ... Patty hit right on it," Kelly said.

Patty: Clients have ‘absolutely no interest in selling any gold’

Judge Wapner refreshingly gave Patty Edwards plenty of opportunity to get beyond the tech scene on Tuesday's Halftime, asking Patty about HLF — a legendary call and our runner-up last year for Fast Money pick of the year.

(We picked Whitney Tilson's BP, mostly for the drama associated with it, but as far as pure picks go, HLF on March 2, 2010, was probably the superior choice.)

Edwards said Tuesday of HLF, "It's been a monster, but I think you stay with it at this point. ... I think this thing goes to at least 72."

Edwards even drew extra kudos from Judge, prompting a beaming moment from Patty before the camera cut away.

The subject turned to oil, and Jon Najarian suggested, "97ish I think that's more of a selling point for crude oil than it is something that you wanna be accumulating up here."

Joe Terranova said now's the time to look at names such as CNQ, SU, HAL and OXY.

Patty Edwards said "I honestly believe that we're looking at probably $100 as the top on oil," and that the consumer is getting "comfortable" with the current range. As for a possible gasoline climb, "It's gonna hurt in the center. It's not gonna hurt necessarily on the high end or so much on the low end."

Edwards also suggested people not get jittery about gold. "The basic buyer of gold at this point in time is not looking at the world and saying it's an all-clear signal," Edwards said. "We're looking at things as BK was saying on a very short-term basis. The average buyer of gold is not buying it for the next 5 points; they're buying it for the next hundred, 200, 300, 400 points, and I would tell you that, talking to even my client base, they have absolutely no interest in selling any gold positions we've got."

Jon Najarian said there's been a "lot of buying of calls in HOTT today," and also people have been scooping up weeklies in GOOG, but he'd "be surprised if it lasts into the earnings."

Sounds like more of
a Street Signs topic

We have no clue why, but John Carney was given the last couple minutes of Tuesday's Fast Money Halftime Report to complain about Sen. Carl Levin's hedge fund capital-gains-rate carping.

Levin, according to Carney, calls it an "unconscionable tax break for hedge fund managers." But Carney says "that's the same every other investor in the world gets."

Carney said it's public policy that "We've decided that we want investment returns to be taxed differently than say your salary is ... that's where he gets it wrong on the fairness question."

Whatever. Too bad Carney didn't tackle the more relevant question, which is why there is something magical about holding shares of stock for 12 months, rather than 11 months.

What would the Obama camp fear most about 2012?

John Harwood joined The Strategy Session on Tuesday to discuss the debt ceiling with David Faber and Jeff Gundlach, who then transitioned into taxes.

But here's the question that comes to mind.

Assume for a moment you're running the Obama 2012 campaign.

Further assume that there's a pre-1980 Ronald Reagan-like candidate on the Republican side, someone with a demonstrably strong base and history of electoral clout.

What is it that this candidate might say that would most concern Team Obama?

We think the answer is, "He hasn't put people to work."

Debt and budget issues don't cut it and never have. Otherwise Paul Ryan would be sweeping to the top of the polls. Thousands of mayors, county board chiefs, governors and a president are going to sign budgets. Both parties are into debt together and they know it and that's why debt-ceiling talk is just summertime mumbo-jumbo that won't amount to anything.

But unemployment, that's an objective (by government standards), easily understood number accepted by both sides and the public.

Quite frankly, it's this page's view that an individual's capacity/propensity for finding work does not hinge on a president or government, that it's up to the individual to figure it out on his/her own and do something for himself/herself, and that it should basically be the job of government merely to not meddle and screw up that equation.

Nevertheless, fair or not, the unemployment rate has long been linked to presidential approval. The current president has barely moved the needle. He doesn't have a worldview about economics. His is a reactive approach; wait for the next batch of data and try the next idea, a stimulus, some Fed machinations, etc.

The most significant outcome so far of presidential primary jockeying is that no one in the incumbent's party is challenging the president. That's practically an iron-clad sign of invulnerability.

Republicans who dicker with the debt ceiling and tax-cut plans are wasting their time. Normally opposition candidates do well by criticizing dubious 1-time past events that they won't have to take a stand on in the future. There's not much on the table there for Republicans this time; they could target ObamaCare but to most people it's benign legislation, and most of the bailouts and housing troubles were happening or starting under Bush. What will/would resonate with enough voters, if it stands, is that whatever this administration has done to move the BLS unemployment number hasn't worked.

Meanwhile, Jeff Gundlach said Tuesday on The Strategy Session, "I think taxes are gonna go up, yes, I do," and then noted, "In 2001, the CBO estimated that in the year 2011, there would be no government debt. None."

David Faber asked how this would affect Treasurys. Gundlach responded, "If there is movement towards the deficit, then low bond yields are here for years to come."

‘People are just wrung out like a towel on Wall Street’

The Strategy Session opened Tuesday with a healthy dive into the very deep end of the CNBC viewer pool, and if 5% knew what David Faber and guest co-host Jeff Gundlach were talking about, we'd be surprised.

Gundlach, the all-time best Strategy Session guest, noted that in the credit markets, "people are just wrung out like a towel on Wall Street."

"The ABX index isn't what it used to be in terms of volume," Gundlach said explaining further that the "AA CMBS index was down to 28 cents on the lows," then recently rallied to 90, then came back down to 60 when everyone shorted, and now all the players have been whipsawed.

After that conversation, Faber brought in ISDA honcho David Geen to better define what actually constitutes a Greece default. "Just S&P, uh, saying that Greece is in default or selective default doesn't in itself trigger CDS," Geen said.

This conversation was also in the deep end of the pool, but not so deep that informed viewers couldn't benefit.

In fact, it really makes one realize how messy and sensitive the word "default" is, and our gut feeling is that we'll end up with some kind of official pronouncement that there was no Greece "default," while gobs of hard-liners will parade on CNBC insisting there was.

"We've never thought that a, a voluntary exchange came that close to a default," Geen further elaborated. Gundlach asked a couple good questions, as to whether it isn't a committee that meets to determine the definition and how quickly that decision could happen. Geen said it is indeed a committee, and it can respond to a "trigger event" within a day if necessary.

David Faber said Gary Kaminsky was improving his tan.

Herb asks a question so good, guest doesn’t really have an answer

Herb Greenberg on Tuesday's Strategy Session took up with guest Peter Siris the subject of Chinese companies, many of whom have done the dreaded reverse merger, and whether there's any value beyond the buyout.

"The buyout appears to be the exit," Greenberg asked Siris. "Without the buyout, what do you have?"

"You have, you have, let me tell you why we're investing in the companies with buyouts and then I'll answer the second part of your question," Siris said.

"Our biggest holdings are all companies that are doing buyouts, now that's for 2 reasons," Siris said, "one is, we were able to identify the companies that would be attractive-"

"Assuming these buyouts are done," Greenberg cut in, as the subject faded to Harbin's auditors, which Greenberg said aren't even Big 4.

Siris said the problem is that there was a mandate for a bunch of companies about which auditors to use. "Some of these auditors just got inundated and they completely got over their head," he said.

Herb lets viewers know he wasn’t grilling guest backstage

Herb Greenberg spent much of his time on Tuesday's Strategy Session pointing to a troubling problem in Chinese companies, namely China-Biotics, in proving they actually have the cash they say they have.

"If auditors cannot confirm cash in the bank, can investors," asked Greenberg, who suggested the auditors have been "hoodwinked."

Guest Peter Siris, an investor in Chinese companies through Guerrilla Capital, told Greenberg, "I'm not worried about what I see ... I know the companies in which we invest."

Siris insisted "we really do a lot of due diligence," and then even offered a couple Brag Trades as proof, saying he shorted Longtop and also China-Biotics when it refused to let him visit.

Greenberg acknowledged he and Siris had a "very cordial discussion off-air here," but returned to his original point, how do you really know, if the auditors don't, whether the cash all these companies report is actually there.

"I think that's good question," Siris acknowledged. But he said he goes to China and knows what he's doing business with, and there are "some just unbelievably great companies growing at 30%, 40% a year, selling at 2 and 3 times earnings."

Furthermore, he added, "I know 5 companies that I believe are gonna announce management buyouts in the next week or 2."

Tim Seymour dodges
a Fast Fire

It was just on June 22 when Tim Seymour seemed resigned to a setback in the 4-years-running-buy-buy-buy Fast Money ag trade.

"We've owned Mosaic here," Seymour said on Fast Money that afternoon. "I think you can start to buy this. You can Fast Fire me on this now because I've been talking about this probably for the last 10 bucks."

MOS closed that day at $63.56. It closed Friday $67.83.

No Fast Fire.

AP quotes David Rosenberg
in class-warfare article that suggests recession is lingering

The Associated Press, looking for that holiday weekend business hook, this time came up with the 2nd anniversary of the purported end of the purported Great Recession, with the deck headline, "no one feels like celebrating."

Now, informed readers might well wonder where that theme is going. (Pick any of the following.) Maybe that government efforts to stimulate haven't worked. Or maybe that the group assigning itself to make an arbitrary definition of recession isn't exactly sure what it's doing or what it all means. Or maybe that the gloom is actually a mirage, that people in good times and bad alike tend to think the economy is worse than it statistically is as they ring up the smartphones and tablets and fill airplane seats and push and shove at 1 a.m. on Black Friday.

But no.

Instead, the article asserts that "The economy's meager gains are going mostly to the wealthiest," (interesting because that's what Democrats always said about George Bush but certainly they won't pin that on Barack Obama), and without trying to go any deeper, simply observes that the average Joe is, according to AP's interpretation of data, feeling a much weaker recovery than after previous recessions. (The lone average Jane mentioned in the story is a former mortgage processor.)

Needing someone to play the class-warfare card, AP finds a taker in David Rosenberg, who says, "The spoils have really gone to capital, to the shareholders," but never says either 1) policymakers are favoring the rich, or 2) corporations have done an excellent job of dealing with a tough environment, which can be the only 2 possible explanations of his quote (assuming of course it's true).

Fast Money scorecard:
AAPL at Thanksgiving 2011

Simon Hobbs is good at asking the provocative question, and he did just that last year before Thanksgiving while guest-hosting Fast Money.

Hobbs asked the crew that day for the price of AAPL in 12 months (which would be Thanksgiving 2011).

Guy Adami — $285
Joe Terranova — $413
Karen Finerman — $360
Tim Seymour — $361
Patty Edwards — $375

If we had to guess right at this point — and thankfully we don't, because Hobbs doesn't ask CNBCfix questions — we'd say Patty Edwards is the favorite, as Karen Finerman seems a bit low, and $400 just feels out of reach.

Apple closed Friday at $343.26, according to Yahoo finance.

[Friday, July 1, 2011]

No. Please, no.

You generally wouldn't expect on a stock market show to get recurring details about a Frenchman accused of raping a Guinean woman, but sometimes that's the way news works.

Virtually everyone on Friday's Fast Money Halftime Report seemed skeptical of Friday's market move, even though, as far as we could tell, if you were long, you were making some decent money.

The show, though, got a lift in the studio chair by the return of a chipper Zachary Karabell, who said the last few days were somewhat predictable as "a bit of window-dressing at the end of the quarter," but, "I'm a little surprised by the strength today."

Karabell, like his colleagues, pointed to much of the activity as European-related but stressed that for Greece, "We are not done with this story."

Steve Grasso then said something we hope turns out not to be true — please don't let it be true — that "the story is going to be about the debt ceiling."

(If this site is actually forced to pay attention to that mumbo-jumbo gibberish through July, we're declaring a month-long vacation to the golf course.)

Grasso never goes anywhere without an S&P trading level. Friday he said, "We have to break above 1,365, 1,370 to be out of this trading range that we are in, or else this is all for naught." He also called the close with a couple other boundaries, but we decided we don't care about those.

Patty’s crew ‘spending a lot of time just talking people through the market’

The news updates during Friday's Halftime Report were so frequent, Patty Edwards wasn't even given a chance to speak until the 17-minute mark.

Judge Scott Wapner at that point reported that fund inflows in June were poor and asked Edwards for reax. "You know, it confirms what I'm hearing from my own clients, which is, 'Whatever you do, don't lose the money for me'," said Edwards, who explained "we're spending a lot of time just talking people through the market." (That's a good idea; if only we had someone to talk us through the 6th hole, in which we'd prefer a score more like NOK and less like DANG.)

But Judge, who generally handles Patty's airtime with a blunt instrument, deserved kudos Friday for giving Patty an extended Call the Close with a request for a consumer discretionary (the sector that needs a sexier name) opinion — except that Patty, evidently unprepared for such largesse, fumbled over the word "background" and took too long to get to a fundamentals-vs.-politics recommendation for XLB and never even did Call the Close.

(Perhaps Patty, who nevertheless sported a sparkling red suit and pearls Friday, will have to get back into Jackie Brown "badass" suit mode to dish it out again.)

(Note: The actual movie line by Billingsley clerk Amy in a rougher voice than you'd expect is delivered by smokin' hot Aimee Graham, sister of Heather Graham, and goes: "I mean, you wear that suit to a business meeting, and you'll be the badass in the room," which Mel Lee should keep in mind in case there are any hot Squawk on the Street negotiations in the future.)

Stephen Weiss said, "The retail investor's notoriously fickle; they typically buy tops and sell bottoms."

Stephen Weiss: Go long DSK

Always-good-to-be-seen Amelia Bourdeau, by far our favorite Money in Motion trader, said on Friday's Halftime, "I like a long euro position against the yen ... you see less of a need for the yen as a safe-haven currency."

Steve Grasso said that despite the recent gains, he expects July to be a better month than June but is waiting until Tuesday to get long.

Stephen Weiss Called the Close this way: "I'd probably go long DSK here and short the cleaning staff at the Sofitel."

Judge Wapner was heard chuckling, "Oh, geez."

Steve Grasso signed off with, "Most of the bigwigs are gonna be on the golf course or on a beach probably in the next hour or so." (Basically true here, except for the "bigwig" part.)

Faber: ‘He did it would seem have consensual sex at the very least with ... the lady who was cleaning his hotel room’

Normally his skepticism is reserved for hedge funds and LBOs and going-privates, but Friday on a DSK-news-laden Strategy Session, David Faber directed his thoughts toward a bit of perspective on Dominique Strauss-Kahn's apparently pending get-out-of-jail free card.

"Even if he does get off on all the criminal charges, uh, nonetheless, I mean, he did it would seem have consensual sex at the very least with uh, you know, the lady who was cleaning his hotel room," Faber said. "I don't know how that goes over in France or not."

GM was in TARP too —
does that tell us something?

Rodgin Cohen got limited time to talk banking at the end of Friday's Strategy Session, but David Faber covered a decent amount with the minutes they had.

One subject was the recent bankers-vs.-Fed tension. "I think what Mr. Dimon was really saying is that it is important to look at all of this regulation as a whole," Cohen said.

He indicated Dimon has a good point questioning the lack of an overall Fed analysis. "Each authority has its own rules to do and there's nobody really taking the overview of the totality of the impact," Cohen said.

What they didn't have time to get into was what we wonder about around here, which is, maybe the real problem with banks isn't regulation, but that they're no different than the automakers ... that their market is oversupplied, that there simply isn't enough demand for what they sell to justify having this many of them, that government intervention to "save the system" unwittingly saved weaker entities that shouldn't have been saved and now exist to compete with the JPMorgans and Wells Fargos for a much smaller pool of business than pre-2008.

Cohen said one thing we learned from the Greece situation is that "fear about the money market funds was way overplayed."

Zynga either made money,
or it didn’t

The Strategy Session graphics police decided to throw viewers a few curveballs on Friday.

Peter Boockvar came on for an interview and described this monster week as merely a "sigh-of-relief rally."

"I'd be a seller of this rally, and I don't think it's gonna last much longer," Boockvar said.

Boockvar went on to assert that "the only positive in the U.S. economy for the 2nd half will be capex."

But curiously, the text on the bottom of the screen indicated 2 other points that Boockvar never actually spoke about.

One said, "BOOCKVAR: EXPECT A RALLY INTO YEAR-END, BUT LITTLE PROGRESS FROM HERE."

The other said, "BOOCKVAR: EQUITY CORRECTION WILL BE A 'BUY' AS FED HINTS AT 'DOING MORE'."

So if we add it all up, we get something like sell now, buy the coming correction as the Fed hints at QE3, expect "little progress" regardless, then at some point before year-end, rally into year-end.

Sounds like a plan.

Further complicating matters, in the middle of Boockvar's commentary, Julia Boorstin delivered breaking news on Zynga financials, saying the company had $235 million revenue in the first 3 months of 2011, but in terms of profitability, "exactly broke even."

But the screen text later said, "ZYNGA SAYS NET INCOME FOR QUARTER ENDING MARCH 31 WAS $11.8 MILLION."

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