>> as you might have noticed, i'm most curious about the small cap implications of the language around rates. we don't actually expect rates to come down in the near-term, but can the rotation continue based on what gets said there? >> it was a mixed picture for the major averages. s&p and nasdaq both tracking for losses for july. but that's going to do it for us here at "overtime". >> "fast money" starts now. live from the nasdaq market site in the heart of new york city's times square, this is fast money. here's what's on tap, consumer crunch, shares of lululemon seeking to multiyear lows and the discretionary sector touching its worth levels of the month. is there insight for the retail names or will this be a case of buyer's remorse. united health has grown into a clolossus in the insurance industry, how the company has cornered the market at the expense of patients. we dive in with one of the

authors later this hour. we've got part two of big shark week, neuberger berman b st izeman will join us. i'm melissa lee coming to you live from studio b. dan nathan, guy adami, timlululn in full downward dog today. had to use that. shares tumbling ing to 9%. slashing the price target by nearly 30%. the company also dealt a blow as it was forced to pull the hotly anticipated breeze through leggings from its stores and website amid tepid reviews. it wasn't the only consumer name, analysts at cowen cutting on nike and adidas and ralph lauren says western brands are losing their advantage. the consumer discretionary sector managed to eke out a gain today it has fallen sharply from

recent highs and is the second worst performing sector in the s&p 500 this year. is there any reason to give this group the benefit of the doubt? is there belief for a comeback? can lulu shares get off the mat so to speak? >> that is clever. you did that on your own. that wasn't in the -- good for you. >> yeah. >> first of all, you know, we give analysts a hard time when justified, but randall koenig at jeffries on june 6th, $240 price target. a lot of people said you're out of your mind. look where the stock traded down, well done by jeffries. number two, no, not really. you haven't seen capitulation yet, and quite frankly they are clearly challenged. we talk about it all the time, when specialty retail, when margins start to change and when you start to see the other side of this sort of growth curve, that's when things get bad. i still think there's more pain ahead. >> not particularly useful call, the stock's down 5 pre% or so. i'd actually expand it a little

bit in consumer discretionary and some of the things we've seen out of the airlines, some of these other travel stocks. expedia, we've been talking about starbucks. chipotle is down 30% right now just in the last few weeks. there seems to be some pressure on discretionary. at this point, even the airlines, we're probably going to talk about them a little bit. most of them are trading at 52-week lows. some of these things we're hearing are not great if you think about the back half of the year and how much resilience this consumer has. that's one thing we kept on hearing all year long. if you look through the lens of the stock market, it doesn't appear to be. >> it's anticipating something that's happening with the consumer. the problems with lulu really remind me at this point of nike in terms of the innovation gap that it seems to be experiencing, you know, competitors out there opening up stores, just catty-corner from the current stores right now. the breeze through was, you know, part of the innovation, innovation pipeline that was really touted in the first quarter conference call saying this was going to be the start

of the innovation cycle for the second half of the year. here they are pulling it. it got a 3.1 star review from 112 reviewers who bought this stuff. >> apparently an unseemly seen in the back, i'm going to footnote guy adami's joke there. i think you've got a dynamic here. as someone who's been short at different times, nike and lulu in the last 18 months, i think consumer discretionary as a group had the greatest generational moment of covid, athleisure picking up pace. dynamics around the space and i think pentup demand that we're not going to see again for a long time. what it meant in terms of margins, there's no question lulu has been an incredible brand story, and it probably will continue to be, although there is some concern about ubiquity here. it doesn't change soon, and in fact, i think what we've seen with a handful of these names, lulu is certainly a poster child. this is a third leg down. in other words, we've had two decided legs already in a bunch of these names, very, you know,

fascinating to see what deckers is doing in the after hours, and obviously really kicking it after selling off also dramatically into numbers. dan referenced the broader consumer stuff. we've heard from a lot of different places whether it's luxury and lvmh, whether it's comcast and theme parks, airlines, et cetera. you know, you name it, we've heard about it. and i think it's just beginning even though some of these stocks have priced a dramatic amount of this in. back to lulu, the question really is, especially with the breeze through, how much of a successful launch was priced in by the analyst community? i think we're going to hear about that in thefection few days and what that means for margin for a company that's gone into this down trend in terms of peak margins. that was part of the jeffries argument three months ago is that they go into this period where this is a stock that's at peak margin right now. what's really going to happen when they actually have to start discounting clear inventory, whether it's breeze through or, you know, tapered leg stuff, it's all about wide bottoms these days apparently. there i go. >> i think wide bottoms are now

on their way out, but we'll ask the analyst, she might know more about that than i do. once upon a ime, we were saying that, you know, the higher end consumer, the higher income household consumer would continue spending. they have the savings. they have everything in place to keep on spending. we have heard as tim had mentioned, from every sort of income cohort from many different brands across many different industries. these are the very consumers that are being more thoughtful about how they spend and where they spend. these are the consumers. we're migrating to walmart for deals at this point. >> yeah, you know, everybody wants it save a dollar. it doesn't matter what income bracket that you're in. they're the last ones to fall, your high income earners, and it is about, just to echo some of the things that have already been said, i think it's not a matter of the consumer failing as far as what they can afford. i think it's changing styles. i think it's lack of innovation. we've seen a designer leave or

whatever the chief product officer leave, and city data that i'm looking at on my computer said spending for yoga and active apparel has been down. that has nothing to do with income levels. it's just a changing dynamic on what we -- you know, if you look at yoga pants, they range from -- in lfrom, you wind up seeing the same stuff for 70 to $90. everyone wants to be frugal, especially nin an unknown world where we don't if the recession is going to come, you want to be a little more fry gal. lulu the bottom in my opinion is not in, so i concur with the rest of the group. >> it's interesting. this is lulu specific without question. i'll broaden it out and say i actually this is a bit of -- okay, guy, tell me why you think

that. >> why do you think that, guy? >> that's a great question. look at mastercard and visa since march. put up a mastercard chart. reversed higher today, closed lower. mastercard and visa have been telling their own story since early spring, and the story isn't particularly good. when you overlay that on top of some of the commentary here from some of these retailers, look at how horrible the dollar stores have been trading and look at the strength of walmart. it all starts to make sense. the consumer is not in a good spot. >> let me just say one thing really quickly. this morning we got this gdp print for q2. it was much better than expectations. 2.8%. what percentage of gdp comes from the u.s. consumer. >> approximately 70%. >> listen, you might be able to explain away a little bit of that outperformance in the gdp, but there are definitely some cross currents as it relates to the consumer. we talked about luxury, we talked about the mid end consumer, we talked about the low end. there's definitely headwinds here, but gdp might be saying something a little different. >> despite a lulu's 51% drop this year, analysts are still

broadly bullish on the name. 27 of the 38 analysts covering the stock have a buy or overweight rating. the average price target is almost $400. that's about 60% above today's close. our next guest is one of those buy rating ing analysts. she lowered her price target. let's bring in janine stichter. great to have you with us. >> thanks for having me. >> how do you view the breeze through, you know, rollback? i mean, on one hand you can say, you know, lulu wants to be very attentive to consumers. they want to learn from their mistakes and continue to innovate, and so it's a good thing, or you can say, you know what? that just shows that lulu has an execution problem. it's lacking on the innovation pipeline. it's pushing through product that consumers don't want. >> i think lulu has an execution problem. that's part of the reason why we believe this can be fixed. the bear narrative for this stock has been there's too much competition. what we think is actually happening is lulu's getting in

their own way. we initiated on this stock two months ago. we conduct add survey. there was really high purchasing intent for lulu. and even with this breeze through launch we saw there was high anticipation of this launch. the consumer came out to buy it. the problem is when they tried it on, for the vast majority of people who tried it on, it did not look good on them. the consumer is there. they're willing to buy when the product is right, evening at a high price, but the company has to execute, and they've kind of been getting in their own way. >> whose fault is it? how do we rectify the situation? does it require a new ceo? how do we fix this problem? >> yeah, i think if we look back, when sun cho announced her departure, that was viewed as a negative. this was product conceived under her watch, and potentially it was time for a change in leadership at the product level. what they've tdone there is removed the chief product officer role and taken out that bridge between creative, between merchandising and between the ceo, and the hope is it will

create better agility and allow them to execute more quickly, and maybe remove some of these execution nars that are uncharacteristic for the company but seem to be coming up time and time again. >> with your price target and eps outlook, you're slapping a growth multiple on a company seemingly that's on the other side of the growth narrative. is that accurate, or do you think you're going to see that reacceleration? >> we're not assuming they get back to where they were e. the start of this year before we had this slowdown, it's trading at a high teens multiple. we're arguing that it can get back into the low 20s range, which would be well below historical averages, well below where it started the year, but a recovery multiple that still says there's growth and this is a north american business that is going into perpetual decline. >> for lulu to regain sales, where do those dollars come from? do they come directly from aloe

and bee your ree in your view? once a consumer goes across the street and falls in love with aloe, how likely are they to go back to lulu when they've been missing on the fashion front for so long now? >> this sey're nibbling at the s of growth. what we found is the overlap is less than we expected. where the share can come from is the bigger players. nike is more focused on fixing their footwear than anything else. under armour which is a multibillion dollars women's business, they're going through a complete reset and walking away from that business. athleta, it's gotten better in q1 but has been floundering. there's bigger companies they can take share from. even if you have smaller upstarts. >> thanks so much for your time. >> thank you. >> tim, she just gave you a

laundry list of these athletic wear makers that are all having issues at this point. >> look, i think there will be a time, and it's not going to be when the economy's kicking it. there's going to be an opportunity where the multiples have gotten pretty cheap, and there are brands in here that are extraordinary brands. they are leaders. they are best this class. i worry a little bit about this lulu brand, i don't think it's ever going to be as hot as it was and as exclusive as it was. it really does get down to where you put that multiple, as she said in the low to mid-20s on a multiple. you've put a massive discount on where it was. i think they get cheaper, and i think they get cheaper because i think the consumer has stopped going as hard into some of these areas as we know. the trends over the last couple of months, even if you bring it back to a cmg and some of the restaurant stocks, thagd talked about the trends for the last two months. we may be seeing this, and bill dudley who's out there saying the fed's behind the curve.

we have this debate every night. there certainly has been an extended period of resilience. it does appear from this earnings season based upon real and current trends that reach seen from companies that it's happening faster. i don't think you need to chase any of these names here, and i think even deckers is going to trickle lower again. >> i mean, to your point in terms of putting together all the data points, the consumer's also slowing down their spending and experiences. at one point it was a tradeoff, right, between stuff and experiences, and now it's just i'm not going to buy as much period across the board. >> that was the thing during covid, it went from goods and after covid it went to services. we're seeing a little bit of a hangover. we saw that in goods a year, year and a half ago. royal caribbean, you know, they gave slightly disappointing earnings, the parks business, we heard it from comcast. i think we're probably going to hear it are from disney. it just kind of speaks to a consumer that is probably get ago little tapped at a time where credit got a lot harder to come by, and we know that some of those credit numbers, we've seen it in auto dlelinquencidel.

you see a consumer that's strained. you can throw a dart at the different companies that are suggesting that the back half of the year, again, is going to be more difficult than the first half. alphabet shares taking another leg lower this afternoon after news open ai is launching its own search engine. steve kovach is here on set to break it down. >> open ai is getting into the search business. that sent google shares down about 3% today. and look, here's what the announcement is. it's called search gpt search engine powered by open ai's ai models. they're calling it a prototype for now. it's not launching yet, but you can sign up for a wait list to try it. open ai says it's partnering with publishers to give them proper credit in searches and publishing with "the wall street journal" and the atlantic. it's very similar to the popular search engine perplexity backed by names like jeff bezos. sam altman tweet that had this will eventually integrate into

the main chatgpt app. this is an speerexperiment righ. they're going to learn from it and incorporate it into their main product. put that in context. microsoft's bing chat which was announced 18 months or so ago failed to gain share from google, despite the fact microsoft said for every point of market share we gain against google, we're going to make a billion dollars in ad revenue. that never happened. it's way too early to tell if this is much of a threat to google. the market seems to think it's time to take three points off alphabet. >> it is amazing that the market assumes whatever competitor comes in, so in terms of microsoft and the failure beginning to gain traction, do you think it's just because people didn't like bing to begin with and people didn't want to go back to bing because they thought that wasn't a good search engine to begin with? >> think of the distribution power google has. it is the default search engine on iphone, pretty much every

browser, fire fox, whatever, obviously chrome. they pay every quarter just to have that right to be front and center, and bing doesn't necessarily do that. they would like to be in that position, but they're not, and that is a huge barrier that a company like open ai, if it is going toe on search. this is dicfferent. hearing altman saying we're going to incorporate this into the main chatgpt app. it can pull from the web. it can tell you more current information. chatgpt can't really do that now. >> i read what you read, steve, and the idea that it will be integrated in chatgpt, that is a subscription product. you pay $20 a month for that. a few months ago we had the ceo of perplexity on here, and he's calling what they do an answer engine. when you think about this, i pay for it, i really like it. they give you the opportunity to use chatgpt, llama from meta, and then they're building their own large language model. they're all becoming

commoditized. some of the smartest people in the business are suggesting that. so perplexity offers a lot more options, let's say if you're doing it from a subscription standpoint. i think it's less of a challenge to google right now. >> it absolutely makes sense. perplexity is more of a straightup we want to be, i know they call it an answer engine, it is more directly going at google. we have not seen perplexity eat into google's market share. doesn't mean it won't. google has that dominant position just by being front and center in pretty much every web browser by default. that is their key mote right now. >> it's nice having steve here. >> it's nice having people visit us. we like people, we like speaking to people. >> i'll come back. >> he can't invite himself back. you can't invite yourself back. >> so now he's barred? >> oh, wow. >> i'll come the day you're not here. how about that? >> alphabet was in a vulnerable spot after its earnings with this news it's even worse. >> we talked about that in earnings. the setup did not look

particularly good. turned of the to be right. we also pointed out go back to december and january. stock traded from 155 down to 130, pretty much tin a straight line. it happened in the fall as well, and you're on the verge of the same thing happening now, so you're looking for a place to buy google here, not sell it. it's one of the few stocks in that universe you can still make a case on valuation. >> coming up, investors feeling the love for southwest, even as the airline announce add major overhaul to the way it does business. plus, eli lilly losing ground, what is behind the recent weakness as the red hot shares enter a technical correction. more "fast money" right after this. >> announcer: this is "fast money" with melissa lee right here on cnbc. this is clem. clem's not a morning person. or a night person. or a...people person. but he is an "i can solve this in 4 different ways" person. and that person...

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welcome back to "fast money." two airlines topping the tape today after earnings before the bell. american and southwest both beating eps estimates. southwest also announcing big changes to its business model. the company long known for its open boarding policy, which was terrible, will now assign seats and offer pricier options with extra leg room. the changes will require new

cabin layouts so will need faa approval. southwest launching overnight flights in the coming year. in the last hour activist investor elliott management which announced a stake in the company earlier this month said these initiatives are not enough and are still calling for a change in management. tim, some interesting news out of the airline sector today. >> yeah, 50 years with that seating policy i've never enjoyed either. it does require some to sharpen their elbows a little bit. i look at airline stocks, you look at the jets etf, it's down about 14%. this was a very negatively revised guide coming into this. this bar was as low as you could go. therefore, i'm not all that impressed. i think they've guided for the market's expecting third quarter losses i think across the airline industry. we've had dour outlook in terms of pricing power and where third quarter volume will go.

that's a signal to me that at least it's not yet time to dip in, even though i don't think the market's going to give you that head sign it's time to start buying airlines again. they will get oversold before they are worth stepping back in for. >> oversold, 38 1/2, 39, that's been supported a couple of times. we've come off from 54 or so. it feels like there's still some room, and i just throw this out there. >> is this about the seating? >> yeah. >> yeah. >> because i went to the college in the 1980s, and there was an airline called people's express, it was the same stuff. you codidn't ghetto set to see . what year is this? this is southwest airline, these people think it's a good idea. >> you should applaud them for finall finally doing this. >> johnson move. >> what does that mean? >> urban dictionary. >> steve gras so do you have a trade on airlines? >> if you look at southwest,

let's forget the fundamentals for a second. if you look at the chart on it, a tremendous bullish and golfing candle, we've been talking about this in a lot of other names, it's aen outside reversal day. every airline with the exception of united had an outside reversal day and the most impressive one on a chart was southwest. so could they stagger a little bit here? of course, but it looks like a defined trend line that is probably going to be broken and start moving higher. >> wait, so you think they should stick with this open -- >> no, no. they should have never had it in the first place. seriously, somebody thinks, you know what? that sounds like a good idea. let people run onto the plane and try to find a place to sit. >> knock each other down so they can sit next to their child. i've got to sit in the middle between two rather large people. is that a good idea? >> i didn't mean to set this off. >> i just wanted clarification. >> you just have to fly private,

guy. >> if i was doing that, you wouldn't be seeing me here on cnbc "fast money." i'd be watching from the plane. >> there's a lot more "fast money" to come coming up next. shares of eli lilly and novo nordisk losing weight as competition heats up. is viking therapeutics emerging as a serious threat to the incumbents? we'll go inside the expanding battle for glp 1 sighupremacy. big short week rolls on with one of the traders who saw the 2008 financial crisis long before it happened. steve eizman is here with his take on the recent selloff and where to put your money in the second half of the year. you're watching "fast money" live from the nasdaq market tesi in times square. we're back right after this. at pgim, finding opportunity in fixed income today, helps secure tomorrow. our time-tested fixed income suite,

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this year's two big weight loss drug winners continuing their recent pullback, eli lilly and novo nordisk pulling back after arrival viking

therapeutics said it was advancing its oral and injectable gl 1 treatments in its clinical trials. lilly has lost $120 billion in market cap from its highs. and of course you have to think of this whole rotation that's going on from sort of the so-called high flyers, richer valuation stocks to the more value-oriented areas of the market. this is getting swept up in addition to all these headlines about newer competitors entering the market. >> tim has brought this up and dan, they are trading like technology stocks. we've tried to say incorrectly for a period of time that eli lilly specifically was getting really expensive on a number of different metrics, not least of which their market cap compared to the earnings revenue they're going to see next year, which is historic in terms of big cap pharma. it's getting a bit more reasonable now, but i don't see any compelling reason to go jumping into lily here ahead of earnings. i think it's august 8th. unfortunately i still think there's room to the downside. >> to your point, especially with the competition coming, and

there's going to be pressure on pricing too, right? if you think about that, that's what happens when you have that sort of competition. it's trading at 60 times this year's earnings and about 18 times sales, and that only comes down to if you believe that the next year estimates are here. 47 times and about 14 times sales. to guy's point, you kind of want to wait until this thing, give this sort of guidance. a lot of these studies we've been talking about, it's not really that great. you kind of get a sense that everybody wants to get in the space. ultimately you're going to discount some of these valuations. you're going to look and see what comes to market. >> the viking study was robust. some of the studies were like six patients. it feels like lily and nova are just a headline away. they just need a headline about their latest weight loss drug that doesn't involve as much muscle mass loss as the original generation and off to the races again, tim. >> yeah, six aussies, i believe

was the last study we were talking about. it's a case where lilly, though, will have the greatest period of eps expansion in pharma history. they're going to go from 650 last year to 1350 to 1950 if you take kind of a consensus call on this. the question is what happens after 1950, and what happens on the competitive landscape. so that's absolutely been part of the price action. and we know this has been a market price action that's been rewarding rotation out of higher multiple stocks into lower m multiple stocks, really happening within health care. look at pfizer, look at j&j, you're seeing it within the pharma space, and i think that continues. so the dynamic to me is around the competitive landscape, but still, i think lilly is going to do what they're going to do. there's no question, but the question really is beyond two years, and i think right now competition is probably moving faster than the market knows. i own some lilly, i'd be cautious. >> and you also own viking as you pointed out yesterday night,

you own some of the competitors. grasso, you're in sort of the competitors also, still? >> i've been in and out of the some of the competitors. i'm not in it now. if you look back on the chart on lilly and novo going back to a handful of days ago, july 16th and 17th is when roesh came out with their early stage as well, and we've talked about that on the show. that's where the both stocks, lilly and novo started to fall off a cliff. what's amazing to me is that if they are trading like tech stocks, you don't really see nvidia or you didn't see nvidia fall off a cliff with very small competitors. so the trade i would look at is the xpi, the small cap bio tech because if a lot of these names are potentially takeouts, that's where you want to be. >> coming up, ford having its worst day since 2008 after reporting a mixed bag of earnings last night. it's not the only automaker

struggling, what we've learned about what has got these names hitting the brakes. steve eisman, one of the traders who spotted the 2008 financial crisis before it happened will join us with his take on the markets, positioning in the second half. be back right after this. >> announcer: miss add moment of fast, catch us anytime on the go, follow the "fast money" podcast. we're ckig aerhiba rhtft ts. go, podcast. we're back right after this. fas go, follow the "fast money" podcast. we're back right after this.

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welcome back to "fast money." st stocks losing steam, the dow gaining 81 points. the s&p ending down half a percent and the nasdaq tumbling 1%. cbre group jumping double-digits. morgan stanley also initiating coverage saying the company is well-positioned in the commercial space. energy stocks jumping even as crude hits a six-week low. the xle and the oih etf now positive for july, and cold storage company lineage jumping more than 3% in its nasdaq debut. the company raising $4.4 billion in the largest ipo so far this year. and finally, look at this blood path, medical device company

dexcom plunging more than 40% after missing second-quarter revenue estimates and lowering fiscal year guidance. the lowering in guidance is by $25 million, you. he is known for the betting against the housing market before the '08 financial crisis. we continue with steve eisman, senior portfolio manager at neuberger berman, he joins us now. you weren't surprised by this selloff we saw yesterday's session. >> you think i wasn't surprised? who are you talking to? i was surprised. >> you were surprised. >> e yyes. >> you didn't think this rotation -- >> rotations are always violent. they always catch everybody unakwars unawares, and it's not a fundamental correction. it's like a psychological rotation. people all of a sudden woke up to the fact like i want to own something else for a while. >> uh-huh. >> i never can anticipate those things. >> right. do you think the psychological

rotation, though, is something that will hold? is this something worth investing around this change in psyche? >> i don't trade. i just don't trade. i'm not particularly good at it. god bless people who are. i like to hold stocks for a long time. i don't think fundamentals have really changed all that much. the only negative data point i would point to is consumer spending seems to have slowed a little bit on the margin and delinquencies are up a touch, but nothing -- probably the economy has slowed a little bit, but i don't particularly find any of that alarming. >> steve, it's interesting. last time you were here and i'm not putting words in your mouth, so if i'm wrong, please correct me as you want to do. you said basically 100% certainty that candidate trump would be president in november. >> yes. >> has anything changed over the last couple of weeks. some of this market gyration. >> oh, has anything changedd politically? is that what you're asking me. >> would you substantial doubt

stand by or change the calculus? >> i said it a month well before the debate. what i said back then was that what was going to happen was that the protesters were going to convene in chicago, and they would burn the american flag and burn the israeli flag and they would say a lot or very not nice things and the whole country would be appalledm. i think that part of my prediction will be a thousand times proven to be true. you got a little preview of that yesterday when prime minister netanyahu was speaking in congress and the protests took over union station, and it got pretty ugly. they burned an american flag, did graffiti over all these monuments. i think the protesters probably think given how up in the air the democratic party is right now and they probably think they have an ability maybe to influence things, if i thought l let's say 2,000 people were going to be at the democratic convention, it's going to be 50,000 people. i don't know, it's going to be a lot of people. it's going to be i think very

ugly. that part of my prediction doesn't change at all. >> steve, going back to the markets, you know, again, trying to call these sorts of moves is really tough to do, and again, you're long -- >> i think it's impossible. >> yeah, and again, but you think ai has a lot of ollegs, right? you've talked about it. much like last summerin july into q2 earnings period, you know, we saw a slowdown in the sentiment of that. those stocks sold off. we're kind of in that same period right now. >> almost to the day. >> what do you think about the capex cycles? i believe nvidia started selling off when google, alphabet, capex wasn't that much better than expected. next week we have microsoft and we have meta, which are two big customers of nvidia. do you use these opportunity, let's say those stocks are down 25%, are you adding to those positions there if you get these sorts of selloffs? >> on selloffs, if they're big enough, we probably would add. let me be a data point that tells me that we are so early in this ai story, it's hard to even

tell where we are. so accenture has two businesses, consulting business and they have the outsourcing business. and the consulting business is not doing particularly well, not badly but not well, but the outsourcing business is growing rapidly. the company is all over the united states and in europe are hiring accenture to clean up their data. you have companies, major companies that are not even in a position to do anything within ai because their data is not yet clean and in one spot. so most of corporate america is just in the early process of cleaning its data before they could even figure out what to do with respect to ai. >> snowflake is in that same business. snowflake is down 60% from its highs and trading near 52-week lows. again, there's kind of easy ways to think about some of this stuff. i could probably counter almost everything you say. unless you tell me that microsoft, nvidia, you know, all these companies are going to be $5 trillion companies, which i'm

not sure they're going to be that anytime soon, i just think there's a potential hangover for a lot of these stocks. a lot of the performance has been pulled forward. >> you could have made the same argument last year and then nvidia numbers exploded. so look, i just think the ai story is early, what microsoft is going to say, what nvidia is going to say, i have no idea. >> the bottom line, it sounds like the -- as terrible as it might have felt during the day. >> it felt bad. >> it felt bad. it's not a pullback that you would buy. did you add to positions based on -- >> we're fully invested so can we do things on the margin? sure, but i mean, generally speaking, our clients are fully invested and we've done pretty well, and we're not changing. the only reason why we would not be fully invested is because we think there's a recession coming, and that i don't see. >> right. you do see going back to the predictions in politics, a red sweep happening? >> that i don't know. >> you don't know. >> i still think -- i'm pretty certain that trump will be

president. i don't know whether it's going to be a complete red sweep or not. i find -- if i may pontificate for a moment about what has just happened, one of my favorite shows in the world is "the west wing" and the last season there's a wonderful scene, which i think is very pertinent to today, which is jimmy schmidts becomes the president-elect, but unfortunately his vice presidential candidate has died, and so he has to pick somebody, and so he has a conversation with alan al da who's the guy that he beat. he says to alan alda, i have a legal opinion that says i can appoint anybody i want to be vice president and the 583 electoral college members can vote for this person, that person becomes vice president. what do you think? and alan alda says this is the united states of america. you can't have 583 people nobody's ever heard of pick the vice president of the united states. it has to be an open process. well, i'm not telling you to

support kamala harris or not to support kamala harris burt she just got picked in a completely not -- the president of the united states just appointed her to run for president, and everybody's saying okay. i find that very strange. i really do, and it says to me more likely than not that her support in the country is going to be a mile wide and an inch deep. >> okay, steve, always great to see you. you're always welcome whenever you want to come back. >> his jacket looks great. your wife continues to do an amazing job. >> he says he picked it out himself. >> he's lying. coming up, automakers, a host of legacy auto names coming under serious pressure. we'll dig into the drop. and later, health insurer hangup, the the author of a wide ranging investigation will join us to tell you how united health may be profiting unfairly from its clinic accusations. more "fast money" in two.

welcome back to "fast money." ford shares plunging 18% for their worst day in more than 15 years after the company's earnings report last night. the automaker missed profit estimates, maintained full-year guidance, some investors were hoping forecasts would be hiked. ste lantus seeing shares drop.

also the same story for nissan. you name the automaker, and they're having troubles in the u.s. market. >> there's nothing exciting about looking at these charts and with ford especially, there's a lot of technical damage that's tdone on a day lie today, and think about it, a long piggy backing everything we heard about the warranty issues with ford, think about how much they lose, and the last thing when you really look at it, higher rates are not benefitting the automaker. i'm not rushing into any of these. >> tim. >> well, i last night said pretty vociferously i thought it was overdone on ford. i was wrong on that. i'd rather focus on gm who i thought numbers were fantastic. that's two quarters in a row they've beaten rays. they've got a $10 billion buyback going on. they're going to -- that will charge up eps. i mean, it trades south of five times, and they are -- you know,

they are in growth areas in the global automarket. the u.s. pricing right now for now is also holding up. so i recognize, you know, gm's pullback is 11% off of a massive, massive run. in fact, a chart that looks a lot like the mag 7. so i'm notthat worried about the fundamentals there. and you know, i realize there are things in the auto space that could come cyclically with the economy, but for now the u.s. market is very strong for gm. comiing up, a new report shedding light on how united health, we'll sit down with one of the ahoutrs for a closer look at the insurance industry and medicare. "fast money" in two.

welcome back to "fast money." an in depth report published today taking aim at the nation's biggest medicaid advantage provider, united health. the first investigation in the series by stat news finding unh is reaping profits through its giant network of physicians by overdiagnosing patients resulting in massive sums of money the company can pay to itself. joining us now is one of the article's authors, bob herman. great to have you with us. this sis an extraordinary piece of work. i don't think many people understand how far the tentacles

go in the health care industry of united health. one in ten physicians are employed by united health effectively, and it's that leverage that they are really taking advantage of here. can you explain what you found? you interviewed so many physicians in this network. >> yeah, thanks for having me, melissa. the p united health is known for being a large health insurance company, a large pharmacy benefit manager, but really this aspect of owning doctors, owning the medical clinics is really under appreciated. it is in terms of the physicians that it controls and influences, it's one of the biggest now. and if you own the doctor, you own a big part of the health care system. you get to control where the patient gets care and crucially, you get to control the patient's medical record. you get to control how sick the patient might appear on paper, and that is so influential because it dictates ti-- in thi instance it dictates how much united gets paid by medicare,

and that money is funded by taxpayers. >> so specifically you have talked to physicians who used to be employed by united health, some currently employed, who feel pressure or felt pressure to code for certain conditions which they didn't even feel were applicable in that situation. so effectively, united health could get paid more. is that right? >> that's right, yeah. physicians basically say after united came in and took over their medical practice, things changed. the first often was their commandeered their schedule, they had to see more patients. what you're talking about is the bigger issue, which is they felt like there was pressure or, you know, an unspoken dictate to code more conditions for these patients. for example, we heard instances of united telling its doctors to code more for peripheral vascular disease, for chronic kidney disease, these types of conditions that are very lucrative if you put them down,

but they're also open to interpretation, and patients might not even be getting treated for them, and so it's one of those things where if you control that coding process, you get to control how much money you get back. >> it's just shocking. bob, unfortunately we're out of time. i hope everybody out there reads this article, though, bob herman of stat news. appreciate it. tnkfor vi m >>has hange. >> up next, final trades.

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>> steve. >> sam sarah, iot, great trading names, stock chart looks like an ekg, i'm long. >> dan. >> these semis are hot to go. i'd be a sell zbler hot to go trend. >> all of our viewers knew that. >>vc. >> "mad money" with jim cramer starts now. my mission is simple. to make you money. i'm here to level the playing field for all investors. there's always a bull market somewhere, and i promise to help you find it. "mad money" starts now. hey, i'm cramer. welcome to "mad money." welcome to cramerica. other people want to make friends. i'm just trying to make you a little money. my job is not just to entertain about educate and teach you. call me at 1-800-743-cnbc. tweet me @jim cramer. this market might actually be at a fulcrum here. lately we've seen relentless selling in the large cap technology stocks that had