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tv   Fast Money Halftime Report  CNBC  January 18, 2013 12:00pm-1:00pm EST

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talking super vintage? coming up next a 1932 vintage alfa romeo gran sport. it could sell for more than $2 million. next up a mercedes-benz, very rare car, could fetch $2.5 to 3 million bucks. as you mentioned earlier the big show stopper of course the batmobile. this is the original car used in the adam west tv series. you can see it action here. it is expected to sell for up to $5 million. i spent a lot of time as a kid watching that car on tv. now you can read more about this on and on power lunch i'll show you more cars with a big hollywood history. but you know, carl, for 5 million bucks you could buy wayne manor for that amount. a huge price tag. >> the flames out of the back. i mean i'd pay five if i had it. >> yes. >> quickly, what is the strongest segment of the collectible car market? >> it is really the ferraris. the muscle car market that is big in scottsdale, the mass
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market is still well below. but it is the very top, the ferraris from the 1950s have increased more than 50%. it is kind of a tale of two markets. >> great story. thanks so much. have a good weekend. >> you too. >> you have a great weekend. we'll see you next week and get back to headquarters and the fast money halftime. carl, thanks very much. welcome to the halftime show. four hours to go until the close. here is where we stand. on this friday, on wall street. dow-jones industrials down a fraction right now. up six of the past seven days though. the s&p 500, nasdaq in the red as well. china fights back after seven straight quarters of slowing growth its economy shows signs of strength. john rutledge on the stocks you should be buying right now. the rematch. not satisfied after their big debate on intel dr. j. and joe are back to battle it out again. what really is the best play right now? but first our top story the next
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leg for stocks, will it be up or down? the dow has been up as i said six of the past seven days but with a huge week of earnings ahead can the run continue? we're trading today's market action with pete and john. pete, up or down? where is the market going? >> you know, obviously the easy answer would be we've had this huge run. i think we'll see a pullback now. i don't think that is the case. when you look at what the earnings have given so far, look at the financials holding up still above the 17 level on the xlf i'm looking at next week as a huge week of earnings. obviously plenty of names out there that are going to be very important to the next leg higher. so now we've got to get that next leg higher. looking at the volatility index it gives me all the indications in the world right now. there is not a lot of fear. there is protection in place after we got through the january expiration. so this ought to be very interesting. >> i like that answer. in the heart of trade right now, said it yesterday, the heart of trade, the pain for the market is the move to the upside. pete pointed out yesterday on
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twitter, we discussed it, a lot of folks stepping in. the skew to the call side. a lot of institutions looking at volatility being real cheap. they're buying calls getting into the market and chasing the tape higher right now. while you have the market correcting a little bit right now i wouldn't call it panic mode. wait and see what the earnings are. put some protection on if you really are at risk but the path of least resistance is higher. >> it's been up six of the last seven days. >> and it is modest. >> taking a breath. >> if you look at the internals of the market you got utilities higher today, financials a little weaker. there are signs in the market place that say this is the beginning of a correction. i don't see that. but i understand the other side of the argument. >> how about this sign? inflow into stocks again the biggest two-week run into equity mutual funds in at least ten years. >> it is going to get stronger and bigger. there is so much good news out there, what the market hasn't
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focused on today and i'm surprised is that ryan basically came out yesterday and said we'll push the debt ceiling thing off for three months. you have china coming up with good news, better than expected gdp. ge which used to be the bellwether people focused on coming out. lots of good comments. good earnings. europe, that is sort of like stabilizing. and i do think there is more easing there. and japan which hasn't had a really roaring economy for two decades, you've got omni in there now. they're going for 2% inflation instead of deflation. don't forget how large that economy is relative to the world economies so i think the market has nothing but not green shoots but blossoming flowers. go buy it. >> so why then, doc, are you still more cautious than the other guys? >> partly because, judge, i like owning options instead of owning equities. i just do. the only times i like owning equities are like for instance when joe and i fight about stocks with nice yield. i mean whether it's a verizon or whether it is intel, if i'm
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talking about a 4% dividend yielder that i can get in there and write options against it as well and take it to double digits on the return i like that. but i don't like buying apple. i don't like buying a lot of the stocks that don't have the yield, judge, that are attractive to me. instead, i trade the options. >> speaking of verizon i'm glad you mentioned it. next week is a bonanza earnings week. there are so many important companies reporting next week that that is going to decide where this market goes. don't you think? >> yes. the expectations in terms of what the potential growth for eps and the potential growth for revenue. not as strong as what you have this week for financials. so you're really going to need some solid performance from technologies but in particular you're going to get an early read on consumer discretionary which i view as highly important to further appreciation in the s&p. you get that from coach in the middle of the week. to me that is one of the names i will be watching. >> give me a look at the wall of the companies reporting. let's go through sectors and
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some of these names. you have nachls like google on the wall and ibm. there are the tech plays you'll have to watch especially closely, right? >> yeah. and in fact ibm is my tech play. it is my earnings play next week. i think ibm, because this last quarter, when ibm fell right after those earnings and it tested down to the levels where it is now. it did hold at 180 but then it did break down because of the fiscal cliff and all the rest. it did break down through 190. came back up. it's 193ish or so. i think good earnings report next week carries them through 200 on the ibm. >> finally a technology earnings call right. >> hold on. >> apple next week. mcdonald's next week. i'm looking over at the wall. 3m next week. honeywell next week. pg&e. you have microsoft, starbucks, monster names. >> i feel like i'm in a restaurant and you just read the specials. could you go through those
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again? here is the deal. let me tell you about earnings season. so far it's been good. not a lot of companies reporting. about 10% but generally the bar set very, very low. and they've surpassed and surpassed on guidance. that is a positive thing. let me tell you forget the earnings for a second. here is the trade. here is what you got to do. get rid of your defensive holdings. time to play offense and put on risk. to me i like verizon, like the story, expect a good quarter but that is not where you're going to make money. >> now is the time for beta. >> big beta big boy. >> all right. a different restaurant. >> all right. portions are much different. >> yeah. >> you have your eye on nsc why? >> i think what you are really finding out here is, is the china story really playing out from our aspect? are we seeing the shipments going across when you talk about coal obviously very heavily weighted toward what they're really moving right now but also
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merchandise for nsc. i think those will really give us a great temperature or barometer of what is going on in the market. >> our next guest says three factors could trigger a pullback for stocks and his track record on the show suggests you should listen up. mike santoli of yahoo finance has made several winning calls of late and joins us now. mike welcome back. what are the three factors we should be looking for? my guys on the desk are mostly bullish. >> look. i wouldn't argue with them over an extended period. i think the market is reasonably well supported. i'm not saying run for the hills. i think you have a couple things going on. you have the general optimistic back drop. leaves us a little bit over susceptible to any disturbance in the good news. so you have that one thing right there. obviously the citigroup economics surprise index is rolled over. this is just showing whether economic data is coming in above or below expectations and oz lates around zero and is edging toward zero not getting a lot of attention even though yesterday's big numbers were very strong. a lot of what we've had is people building in expectations
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that the economy has some momentum and we're not really prepared to kind of deal with any static in that view. then earnings season i agree the bar is set at a very reasonable level and i think has been generally positive. historically with a good upside run into earnings season you actually have even if companies are beating at 70% based on forecast you tend to have some turbulence. all those things to me says we don't necessarily have, we're not really equipped to absorb anything that is not good news right now. >> you're wore bitd sequestration, right? as we ramp up to the whole debt ceiling end or how that all factors in. >> i'm worried in the sense that people are now saying if debt ceiling is taken care of or deferred we don't have much to worry about. i think we have a little cold shower if we're looking at the economic growth forecast that involved major cuts whether it's sequestration, short-term government shutdown. i'm not an alarmist about what is going none d.c. but i feel like what we've done is the
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consensus has really been oscillating between over anticipating terrible things from d.c. to under anticipating them. i think we are in the latter situation right now. >> michael, it is joe. we may or may not next week get the announcement of a dell deal or potentially the deal falls through. what type of impact do you see in terms of sentiment on the overall s&p there would be if an actual deal is to occur or if it falls apart? >> i think it has to be followed by others. i think i actually feel like it is a one off thing. people are obviously eager to see something get done. you want to see the capital markets be able to achieve what on paper seems like an obvious deal. a company that probably should be private. and so i do think you want to see it done. i don't think it really punctures market psychology that badly if it doesn't get done. i just feel as if deals have to be a component of a strong market here just because all the ingredients are in place and if you didn't get a lot of corporate activity i think it would be a little bit of a worrisome sign that something was a nagging concern. >> mike, let's talk stock pick.
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you started picking stocks on this show on december 14th. johnson controls up 9% since then. january 4th goldman up 8%. jp morgan up 4%. kkr up 9%. blackstone up 7%. ebay. you picked it last week. up 2%. nice record. pressure is on now. >> well it's been an up market. obviously kind of going with the flow a little bit. i feel like if you wanted to capture any potential sudden pull back because of the over optimism or anything like that there is an etf, the s&p, high beta stocks. sphb. which essentially is the 100 stocks that give you the most exaggerated move in whatever the market direction is. i don't think this is a long-term play but strictly a scalping operation or a hedge if you are already pretty long here that would essentially be giving back some of the out performance. sbhb is up 8 plus percent in three weeks versus 5 1/2 on the market. a lot of out performance in a relatively short period of time after options expiration. i don't know what the
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implications are. seems if you had any give back that is where the juice is. >> we shall see. fast and slow money watching as we know. we'll see how it shakes out next week. good to see you. have a great weekend. let's go to the market flash desk for what's moving right now. >> scott, if you take a look at a one-week chart of google you see a blip on tuesday. a sharp tick upward during the facebook event. everyone thought it would keep moving in that direction but it is down 5% on the week. of course it has earnings on tuesday and is approaching a technical breakdown at $697, the 50-day moving average. that is the point where you need to watch it right now. just at about $703. >> thanks. we are watching it. in fact, what do you make of this? sit ricks down for the week, google down for the week. apple down for the week. >> look at some of those really rocking hooe. particularly, the ones that joe and i are going to be talking about. intel with the big spending, they put the -- they just lit the fuse for a lot of these semiconductor equipment plays.
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so i mean you take a look at applied materials up 2% today. you take a look at ate and a bunch of the other stocks in this space. not necessarily klac 10 core. that is one a lot of folks want to focus on but you look at all of the other semi equipment stocks and they are ramping today up between 5% and 6%, a big move coming because intel has ramped up spending so obviously follow the smart money. >> klac ripped yesterday. somebody give me trade on google. they're going to report earnings. pete? >> i'd rather be with yahoo right now. >> really. >> i see more upside still to yahoo right now than at google. >> why? >> i just see how they're actually figuring ways to monetize things i think they have a better direction than ever and when they start to unlock some of the asian asset quote they have presently on the books i think it will be another leg to the upside. >> the dow here, they figured
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out how to monetize mobile? >> they have the ceo. their search has been improving. that is one metric as well. i think there are a lot of different reasons why right now yahoo has more upside. >> google right now very technically in terms of where it is going, break low 650, problematical in term. >> coming up on the half. rally in motion. the high risk trade and research in motion continues as the stock soars more than 100% in three months right now at an 11-month high. we'll get the play as the company gets ready to launch blackberry 10. plus ali versus frazier. now dr. j. versus joey t. a debated rematch on the intel as the stock droppings on earnings. you asked for it on twitter and our traders will deliver with eight plays on eight stocks so you can make your next move. lots more halftime report on the way.
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rhee search in motion now up 125% over the past six months as blackberry 10 gets closer to market. it is our call of the day. weiss you're going to answer the phone because you own it. >> i've owned it off and on since about 2008. here is what i like. as news of the phone keeps seeping out, the stock keeps going higher. that is positive. we find apple in the unique position of being third in line
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in terms of advancement in technology with i'll say this now the bb 10 being number one as you'll see when it comes out. samsung number two. i think you keep going you'll see people coming back to the blackberry particularly corporate america. >> unless they say buy, buy and hang up when the news comes and it is a sell on the news event. >> it won't be. the stock may be but buy there because it is going to go back up. it has a lot of cash. a good company. >> all right. intel the worst performing dow stock today after issuing a disappointing outlook. joe and dr. j. debated the stock yesterday and one of our traders thought he was the clear cut winner. let's take a listen. >> whatever apple ends up doing intel will steal the thunder. the stock is highly correlated with gross margins which continue to decline right now the street looking for 57%. they'll have to guide those margins even lower. >> judge did a great job as always but i go with the doc. >> no! >> i think intel -- >> time for a rematch, round two. why? because dr. j. you told me last night i want a rematch.
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>> that's right. i need a rematch because joe is kicking my butt. >> all right. >> before we go to the rematch two things. i have my back to his brother. you have to watch my back and make sure he does not bite my ear. >> all right. tyson/holyfield reference. >> cap x. when they came out they announced they'd come out 13 billion instead of 11 everybody on the street went negative. the stock went negative. that is when you and i spoke last night and i said joe is right. but where he is wrong if he wants to stay on the bearish case which i don't know if you do, intel is going to address the problems and that is why they're spending more. we talked about how that's benefiting the semiequipment stocks right now. they'll spend 2 billion more this year than last year. also they've got significant revenue coming in from other sources that they're going to be announcing this year and i think being the largest semiconductor maker in the world bigger than samsung and t.i. combined is still benefiting them going
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forward. >> okay. now here is the problem with this. it will be a good story if intel comes out and says we are taking cap x and cutting it in half. because spending $13 billion -- >> what are you talking about. just said they're wrapping it up. >> exactly. that is why the stock is going even lower. i highlighted yesterday the stock is highly correlated to where the margins go. when you have like you had in q 3 all this excess capacity and they can't work it off. they can't work it off because of the smart phone tablet space. where you think they're growing qualcomm right now has a stranglehold on market share. in addition -- >> but nobody wants just one big apple -- >> samsung already made the chips. they don't need intel right now. the chips they do need they are arm chips that qualcomm brings forward. unless intel comes out and says cap x we acknowledge we can't spend that much we're cutting it in half at that point the
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stock -- >> they're wasting money. >> he doesn't want to go out a loser. he is going to basically expand dramatically. >> right. >> with all of the new chips and the rest and get deeper into both smart phones, tablets, ultra books, all rest. that is going to be profitable business. >> that is the last word. the gavel comes down. we're going to the desk. all right pete. brotherly love or not so much? >> i think on the pullback now, intel has been one of these names that actually made a significant move to the upside into the earnings number. if you saw it last night when the earnings were released a little earlier it was trading above $23 a share. so there is an appetite out there for intel right now because of what some of the announcements they're both debating about some of these numbers. i think despite that as the stock is pulled back now is the time to get in. i think he can own it here and obviously near the 21 level with the 4% yield, cash flows, and the second half of the year is where you'll see your money pay off. >> all right. good stuff. coming up on halftime as boeing drops ge pops and the s&p 500
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sits near 1500. not that far away. h heading to the floor of the nyse next. you missed a big call on morgan stanley that would have put you on the right side of today's big move higher. where does the stock head from here? dr. j has the answer next. ♪ ♪ ♪
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or other allergies to aspirin, nsaids or sulfonamides. get help right away if you have swelling of the face or throat, or trouble breathing. tell your doctor your medical history. and find an arthritis treatment for you. visit and ask your doctor about celebrex. for a body in motion. welcome back. today's market quote comes courtesy of our very own john espionage who had this to say earlier in the week about action in morgan stanley. >> the one where we saw a lot of fast money trade was the weekly options in morgan stanley and again these are the options that are something or nothing. it is almost like a binary bet at this point because they expire friday. morgan stanley putting my money where my mouth is, judge.
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buying those january calls that expire friday. >> doc, this is why options action works right? this is why options are a good strategy if you know what you're doing. >> yes. the top of the show you asked me why do you not own stock? i don't own stock because i would have had to basically buy a $22 -- a $20 stock. instead i bought a 32 cent option. it went to over $2 today as jp morgan or as morgan stanley rather ran from 2040 where it was on tuesday all the way through 2240 or whatever the high is on the day on this one. i liked what the ceo had to say. he said their risk weighted asset exposure has gone down. he talked about expenses. joe and i were just talking about cap x over at intel. as far as what morgan stanley is spending that is dropping by $1.6 billion through consolidation and all the rest and getting rid of both employees and some facilities
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over i think now through 2014 so all of that means this stock has more upside and should pierce through the july of 2011 highs not too long. >> doc is playing a little options action. play a little equity action joe. would you own it or not? >> i've owned it for three months both morgan stanley and goldman sachs. i continue to believe -- >> this move today isn't a sign to you that maybe it's time to trim? >> absolutely not. i think it just adds further confidence in what i have right now. i told you i think goldman sachs is going to go well north of 150 and i think morgan stanley will trade well north of 26 bucks. the value of a lot of their mortgage backed securities on the books, they are now increasing. i like the activity in the capital markets themselves. i think of the financial space. this and the regional banks are a place you want to be. >> as the s&p sits near five-year highs in just under 1500 what are the key levels to watch? let's get the answers from the floor of the stock exchange. steve grasso from stewart frankel joins us. good to see you, bud. >> how are you? >> good thank you. what are the levels you're
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watching? >> everyone's cactus league in on it is pretty easy up here right? you look at 15.76, look where we're at now. everyone is getting extremely bullish. just those key levels. 15.25. 15.05. those are your resistances in between. >> let's talk some individual names here. ge, big earnings report today. we'll talk boeing as well. those companies are somewhat linked because ge is obviously a supplier to the 787 and had some comments today. give me the trade first though on, i guess let's go ge first. >> ge since november since middle of november the stock has been up about 10% but is still not in an over bought status. so you can still buy this one but i would say that 23 is a resistance. then it gets a little bit gappy up to 26. so you're playing it truly for $26. >> let's talk boeing. murph called in yesterday and said there is too much risk to get into this name given the issues going on. just to continue the thought
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from general electric, the cfo saying they don't expect a material impact. they supply 200 or so engines to the 787 in 2013. what do you do with this name? >> it has been a perception issue forever with the dream liner. now i own a very, very small piece of boeing for probably 15 years. i am not going to sell it. if you are an investor right now it is too small for me to be concerned with. i truly bought it for one of my kids to be honest. so now if you look at this on a basis of there's so much head winds ahead of this stock, i need closure. so i agree with murph. the risk to the down side to me is probably $65 or so. if you look at it on a yearly chart it stayed pretty much in a trading range. the upside is not going to be more than $80. you're stuck basically looking at $78 as a top. i don't think it is worth a risk reward right now. >> let's kick it around with the boys on the desk. what do you think of grasso's
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call, anybody? >> i like boeing because of the big risk reversal we saw yesterday. again, reading the tea leaves with the options would have caused you to basically jump on this one and you could have written it for perhaps a $3 pop to the upside. they haven't taken those off. i've been surprised that it hasn't had more of an effect, judge. all the negative view of burning things in the plane and grounded airlines, when they come back and fly next week maybe that's the time you want -- >> it's not like you're going to go to ten other suppliers to buy your dreamliner. you have one manufacturer of a dreamliner and then you've got air bus manufacturing their version. so people have already lined up. if it's a battery issue that is very fixable. so all it means you'll see a little bit of a delay and maybe bad sentiment but that to me is not the story of boeing. i want to look at what is happening in the defense business, sequestration and the defense budget. >> if you could only see the look that teranova is giving you as you speak. >> pete and i are speaking the
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same thing. how is he qualified to talk about commercial airline when he flies all over the country privately? it doesn't make sense to us. >> i talk to people like you and i say what is it like? >> guys, guys. just to bring you back to a trade here on boeing what you're -- what are you truly risking? you're only looking for a couple dollars to the upside. it is dramatic they've been able to hold on for the price but why risk it to hold this level. that is not -- got to run v a great weekend. steve grasso. one of the biggest bears on netflix gets bullish all of a sudden. should you get in on the stock ahead of the results next week? we have a list of names to own as china's economy shows signs of rebounding more halftime up just after the break. ♪ [ male announcer ] how do you turn an entrepreneur's dream... ♪ into a scooter that talks to the cloud?
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welcome back. let's get right to our own john harwood. >> scott, the republican house leadership is alt a retreat in williamsburg right now. they have settled on a course that they're going to take to the house floor next week on the debt limit and it is as follows.
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they're going to pass a short-term extension of the debt limit to april 15 but attach conditions to it. not spending cuts but the conditions are that the house and senate both pass budget resolutions by april 15th which is supposed to be the case already but it's a deadline often missed in the law right now. and if members don't do that, if the house and senate don't pass budget resolutions their pay would be withheld so the slogan for republicans is going to be no budget and no pay. now this is an attempt by republicans to get past the potential blame that would be associated with not raising the debt limit but it is not a long-term extension of the debt limit. that is still a card that republicans are holding back. this is something that john boehner has now agreed to. he just put out a statement as i was sitting down in the chair to that effect and it's indicated if there is going to be a long-term extension of the debt limit there is going to have to be spending cuts and the purpose of the budget, requiring the budget resolution is to try to
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flesh out what some of those spending cuts would be. >> presumably that would pass the republican controlled house. what do you think the reaction would be in the democratic controlled senate? >> i just got off the phone with a democratic official and the leadership in the house who said, we are not going to pass something that is loaded with conditions like that. if we do a short-term extension eventually it is going to be a kleenex tension. that is with no conditions. this is part of the stare down that's been taking place. the administration, the democrats have been saying clean long-term extension, republicans are now saying short-term with conditions and democrats are going to come back and say if you do short term we are going to do it without conditions and this is a very difficult and intractable problem and what we're seeing is the beginning of both sides trying to dance toward a sweet spot that will at least get us out of the bind in the very immediate term and the term is pretty immediate because we know from treasury that we could run out of the extraordinary measures treasury is taking to stave offer the
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debt ceiling as early as february 15. >> that is what geithner himself has said. >> that's right. >> good stuff. thanks so much. >> you bet. >> have a good weekend. we'll see you next week. john harwood. pick up the debate somewhat on the issue. does it perhaps, can you say it extends the possibility that the market can look past what is going on? >> we've shut down the government before. it is a momentary instability in the markets. i think it'll be a buying opportunity. i like sequestration. i like the enforced budget cuts because that really helps the deficit. so i'm in favor of that. >> it's another reason the vix is down this much today, judge. you look at the market the market is pretty flat today. but the vix is just getting cranked. >> on your point, sorry to interrupt, i want to let everybody know the vix is now, reading a note from our news desk the vix is below 13 for the first time since june of 2007. and lot of that would mean that the risk premiums of course have
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shrunk and that would be because people are looking out saying rather than at the end of january beginning of february they've got to really ramp up the rhetoric and we get right back to the fisticuffs we saw in december we're not perhaps going to get that now because of this what john harwood just reported. >> another down day for apple and off more than 4% this week is a bottom near or will demand worries keep weighing on shares? pete, i'll go to you on this one. >> stay away from apple. i don't understand what the fascination. everybody has had this fascination that they want to buy the bottom in apple. that is not necessarily how you should be approaching this right now. we've talked about this a long time. steve was talking earlier about research in motion. it's been thon path to the upside for a while now and so has nokia. nokia has had a little pullback now but they've got china mobile. right now apple, what you're preying on is the second half for apple right now. the new release of a lot of their products. obviously i think their earnings are going to be extremely strong
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but then what? i think you've got to look a little further out and say this is going to be a second half of the year story for apple. >> don't strong earnings from apple, joe, erase almost all of the questions that are hanging over the street and this stock right now? >> i think they have to be very, very strong earnings. i think that's great commentary by pete. many people including myself are trying to manage this on a day by day basis and market time and i don't think that is what you do with apple. you keep it as an investment. to fully answer your question i think much of the unfolding story for apple that is going to be known is a story that is going to evolve on the second half of the year so apple may just move sideways. it could move lower if the analysts, rather if earnings do miss and i also think you have to look at it one last thing and that is the effect of a potential s&p correction. if you did get that correction that really places apple in a vulnerable place. just own it. don't trade it. >> questions about maybe they buy back stock. do they hike dividends?
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>> but the leverage involved the product itself. i don't think the capital allocation strategy given where the price is right now is the move. i think that actually signals a little bit of a panic on the part of management. >> this quarter is going to answer little. okay? it is all about new products and whether they've been leap frogd by other technology companies. so if they do 40 instead of 50 million iphones look out. >> it's all interesting products. >> that number is 40 instead of 50 this number will get absolutely -- >> china's economy grew stronger than expected last quarter but expanded at the slowest pace since 1999. john rutledge chairman of rutledge capital said the rebound is more evidence you should be looking for opportunity there. joins us live from california. great to see you again. >> nice to see you. good morning. >> good morning. hard landing. completely off the table now with this number. >> yeah. we've seen 25 hard landings reported in the last year. >> maybe more depending who you listen to, john. >> absolutely. and china is still not dead. >> so where do you look for
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opportunity? what are the best plays? are you sort of sticking to the same types of plays that you've mentioned to us in the past, freeports, some of those? >> fundamentally, china is going to grow about 8% a year for some time. that means their economy will double in the next nine years. so you've got that going for you in terms of cash flow but the governance is very bad there. and western investors really don't know much about it. i think the two key facts are western investors want china to fail which is why we have so many of these hard landing stories and, second, they're getting third hand information so the big swings in china related stock prices happen when western investors lose their mind. and so it's getting a batch of china related stocks and being in or out of them based on this frenzy that we talked about. the china related stocks are best located in safe countries with better governance. u.s., australia, singapore, and places like that. so yeah. there is a handful of stocks that make sense to me to play
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this game. >> here are the ones we're looking at now. i also like you're looking beyond just china for other plays within asia whether it's korea or singapore. give me your thoughts on those and also, you know, give me a thought on the ewj. give me a thought on japan. >> well, i'm involved in japan through real estate. japan is growing obviously slowly. is going to continue that way. but there's a lot of japanese investment in china. there is a huge amount of korean investment in china and in the tech sector. korea is basically samsung and about half the phones in china have samsung stamped on them. singapore is the banks that are increasingly financing chinese growth. australia is cold. lng and other materials, new zealand the same. hard materials from indonesia basically china gets its materials from south asia and its technology and capital from
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north asia. so if you buy into that rim of safer countries you'll have exposure to china. >> john, i can't think of a more ridiculous statement than what you said in terms of western investors. i like your work. in terms of western investors hoping china fails. i've been on the short side of china. now i'm on the long side of some things. i don't really care. i'd love to see china as i think every investor would, china succeed because that lifts the entire global market. so why would you say that? i'm just curious. >> i would say that because i have been on this show and others more than a dozen times in the last year with investors talking about -- excuse me. you asked a question. let me answer it. >> go ahead. >> when people were talking about hard landing. this morning, the morning after we got strong reports, gdp, fixed asset investment, real estate, industrial production. there's a story out about whether that means china's real estate market is going into a
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bubble again. i think western investors do a terrible job understanding china. >> that's two big generalizations. first of all china didn't fail but they did weaken. they're not where they were. it has come down and all the time that you've been saying it is great, great. it's actually been declining. >> that is not true. this year -- the first half of this year. >> john, let me finish. >> we were talking about hard landing. i was talking about seven and a half, 8% growth. that's what we got. >> okay. you talk louder. you talk more often. you must be right. >> john, he calls those terms of endearment. that's all i can say. good to have you on the show. we appreciate your views and insights into what is happening over there. we'll have you back soon, john. >> okay. >> all right. coming up on halftime from casinos to auto parts we have trades on the biggest movers midday plus japan's stock market on fire up more than 20% in two months. we'll show you the best way to play it. ♪
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response. whole foods ceo john mackey one of the most interesting people in american business ness the studio, dead set against obama care but that isn't the only thing that is controversial about him. he is always thought provoking. have you ever wanted to own the batmobile? actually no. but maybe you have. your 15-year-old self must be dying to know how. we'll tell you. back to you scott and the halftime crew. >> thanks so much. see you at the top of the hour. how low will the yen go? japanese stocks ripping again today. the yen continues to plunge against the dollar. should you bet against this trend? let's bring in kathy. this trade is not over. >> i don't think so. i think you are standing in front of the dollar/yen move and trying to short it is like trying to stand in front of a run away train. it is headed higher ahead of the boj meeting next week. >> early in the week, yeah? >> yes. it is going to be on tuesday in japan so i think that today we've seen a little yen weakness. on monday we'll continue to see
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a bit of yen weakness and maybe another break above the 90 level before the boj meeting. >> 90 is a key place for you in this trade. give us the levels. >> it is. basically i'm looking to come in dollar/yen and to pick up the currency and a little bit of a dip at 89.50 so not far from current levels. with the stock at 88 and i want to go half of the position at 90/75. at that point i move my stock to break even and go for a stronger move to 93. the whole idea is if the bank of japan is successful in getting inflation to even zero and a half percent, forget 2%. just 0.5% that should be consistent with the $95 dollar yen. >> the notion a crowded trade is one to maybe avoid doesn't necessarily apply here right? it can still work? >> there are a couple factors driving the dollar/yen higher one is the fact boj is aggressive. the second is the rise in u.s. yields. we do see overall, granted a
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little weaker but overall gradual improvements in the u.s. economy. all of that is good for dollar/yen. >> have a great weekend. see you soon, katherin kathy. let's do some pops and drops now. the biggest movers in midday trading capital one is dropping. joe? a big drop it is. >> it is a big drop. we've talked about this earlier in the week in the consumer finance trades. i said you stayed with them. discover financial. the trade i put on today was american express. i like american express here on a pull back as a defensive consumer finance type of trade. capital one i would move away from. >> i thought you really liked it though in that space. >> i like the consumer finance trades. i absolutely did. however, given what we got today, i don't think that the investments are warranted in capital one or discover. i want the defense of consumer trade. i bought american express. >> i got visa downgraded today too by the way. >> yes. transactions. >> all right.
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tyson foods is popping. pete? >> you know, some upgrades around in the sector not directly with tyson but this stock moving higher hitting new highs. when you look at it right now i think it is over extended and you want to wait for a look for back closer to $20 a share. >> give me a read. >> came out with an update today. better than their expectationes. good news is that result were good. the bad news is that volumes were down slightly from expectations. >> johnson controls. >> they just announced that revenue will be down or income down dramatically. they also said that first half is going to be very challenging. obviously folks that are along the stock and had been writing it on the auto wave are not so happy right now. >> in the words of "the hangover", thailand has them now. recording the best year ever for tourism. if the pristine beaches aren't enough to get you on the next plane, bangkok, the country,
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also is home to the world's largest restaurant and it hosted the most expensive cat way in history. >> we will deliver from facebook to sales force. we will have the trade o so that you can make some money. ♪
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welcome back. well, when you, the viewers ask, we deliver. stocks have been lighting up my twitter feed the last 24 hours, facebook, ford, mcmoran and salesforce. >> sec questioning some of the ways salesforce accounts for the money. that's one of greenburg ear big deals, of course, through a number of companies that watches. morgan stanley came out and defended them, but the stock went right back to selling. down maybe 2% today and sliding about $3. >> one of my peeps wanted facebook. pete? >> they didn't live up to quite the dramaticness we expected from earlier in the week. the stock pulled back from $30 a share. i still like it. i think the mobile rev will be the story leading the stock higher. >> joe rutledge mentioned fcx.
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>> i have screwed this up royally. i looked at buying this today, and i did not. which means it will move higher. i like where this sits. this is about chinese rising, sorry steven. but also about copper pricing, which i like as well. copper pricing moving from q3 to 362 in the quarter that they will report now. if investors can look past the deal they just did then i think this is name you want to own. >> ford. >> southern copper has a great yield and secure play now. >> thank you. >> and i own that one. >> thank you. >> my pleasure, jim. in terms of ford, i like the company. but i don't think it is compellingly cheap any more. so i think you can roll over a little bit. i would wait. quality code plus, if the yen does devalue, it makes the japanese cars that much cheaper, much more competitive. so i would take my time getting to ford here. >> doc, intuitive surgical. >> i mentioned herb greenburg.
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i will just throw it back and yesterday he and i were seeing unusual activity. all of a sudden citron came out with a report it fell $12. bang, comes right back and turns and burns to the upside to $20. >> joey, con cnico phillips. >> yes, it's tightening. >> this is with case and new holland. case and farm ag equipment. i think this one, william blair, putting them to outperform. i like the stock. >> all right, guys, good stuff. final trades are up after this short break.
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ally bank. your money needs an ally. with multiple lacerations to the wing and a fractured beak. surgery was successful, but he will be in a cast until it is fully healed, possibly several months. so, if the duck isn't able to work, how will he pay for his living expenses? aflac. like his rent and car payments? aflac. what about gas and groceries? aflac. cell phone? aflac, but i doubt he'll be using his phone for quite a while cause like i said, he has a fractured beak. [ male announcer ] send the aflac duck a get-well card at


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