>> at the same time, we didn't see that running back in in the last hour of trading we've typically seen, what does that signal to you? >> well, we saw things speed up a little bit. it seemed to me it wasn't really panic selling at all, it was fairly orderly, it wasn't, you know, i didn't get the sense of real fear. i know pete's going to talk more about the vick and how that has started to move up. to me you opened it with healthy correction. i think this is healthy. a little down, that wouldn't be down, but in context of the move we had, this i don't view as particularly meaningful. >> and when you talk about the big cap names and how much they've moved. look at the index, not just today, but look back two weeks ago, we were trading under 24, we were down in the 23 1/2 area july 23rd. if you look, you can see this direction. people have been waiting for something, now they're looking for protection, we've talked about that. they've also used the speculative side, we've talked about that, but now they're starting to see some of the pain that can be involved in the market when you start to chafe. we didn't see the panic as karen

mentioned. you did see a big push to the up side. people are now starting to scramble, not panic, but they're scrambling. >> good news about days like today, sometimes it identifies the stock that wants to go higher. we said we liked it back to when aetna preannounced a couple of months ago. unh traded up around 29.5. >> but you have to separate that. >> not necessarily, because a lousy tape will take everything down. but unh has had a big run. interesting, we can have the debate. my point is interesting move given the move we've already seen in the name. >> pete's comment, i ask, pete, is this an outside move in volatility more indicative of people buying index puts or a heavier move than single stocks? and it is people setting up for more downside. but again, a huge move in the vix to me not just about single stocks. >> i was thinking that maybe we'd hit 30. we never got close to that, although we got a little bit towards the end of the day as we pushed up to the highs of the day. we didn't see panic.

and because we didn't see panic, it's telling you a little bit about the market. people have been waiting for a correction. and don't forget this, at 24, we were moving far too big. the moves in the s&p far too big for a 24 volatility. this is the kind of movement we're getting. we've been talking about it's not just a fear index, an index that measures how much movement to expect up and down. we've had a lot of the up, now getting some of the down and it's priced about right. >> at the same time, pete, when you see the vix go up and people wanting to buy production at these levels. historically, volatility at lower levels, protection isn't all that costly at this point. is it just people being cautious at this point? not necessarily making bets to the downside. >> i wouldn't consider most of what's going on the put side, for instance, the s&p the best of the downside. i would view most of that -- it looks like, anyway, as protection. i think they'd be pushing further down the chain. right now they're staying very close to where the volatility's measured at the money put and call, that's where they're attacking it mostly, not going

to the way deep out of the money puts where you'd see the -- >> in terms of downside protection, a little bit of a day school, a day like today is a day when ets and shorts work very well for you. ewz, or some of the big sector or country etfs. it's down the road in this move down where we get it rolling out of these and getting into single stock names because they're the ones that are going to protect you on the downside. >> let's move on. time for trading. began overnight in asia. the shanghai index plummeting almost 6%, taking the total decline since august 4th peak to 17%. certainly a big move lower, pointing out today the japan gdp numbers. >> i think japan got us going, but shanghai was well on the way friday. we're worried about is this a signal because china has signalled this before. but gdp, expected 3.9. the problem is the domestic part of this number is dead. and japan needs 7% of their gdp is domestic consumption there even though it's a big export country.

people are very worried about this. and if china dries up and that's the big if. because the export component to china was pretty good. german exports last week, pretty good. but people watch this number. so china as a leading indicator for the rest of the globe. david rosenberg was talking about this today. i do think china, if you look back to october 2007 and where that ultimately moved down to. that was the start of all this. there's the shanghai, the shares, the local market in china which was also overly inflated in october of 2007 when all the way down and bottomed in october of 2008, but bottomed before everybody else. >> you know, if you think the dollar's going to continue to rise, which i happen to believe. and if you think the commodity will continue, which i also happen to believe. i think we talked about this last week on the halftime report. i'm not sure. shorting brazil, which is the deep end of the pool trade no doubt, but could be an interesting trade, you might want to take a look at that. i happen to think it could go down to 52. >> and last week we were talking about china, the fxi.

which is people's most comfort level, they look at fxi 25. we tack about the fxxp. a lot of call activity, a double short of the fxi. people were buying this because this was on the low end, september 10 calls, they bought over 6,000 of those a week or two ago. the reason they were doing that, just looking at charts, people looking for any kind of breakdown from china, that's when it started. the fxp had a huge upsurge. >> the place we like to go our high octane down side direct is china is bidou. this is one of the most heavily momentum-played stocks, we are short here, we do think it's going down to 280, and i think it's something to watch. >> the companies that cater to the domestic chinese consumer are poised to continue their runs reference, as opposed to the export-or weren'ted, commodity-oriented companies in china. >> we mentioned china mobile last week and i would be short fxi, but short ach, yes, those guys have underperformed here, but again, if you think they're not -- if they're not going to allow the same kind of liquidity to go into this local market,

won't be getting cheap funding, dropping into the market, if life insurers are at their limit, then all of these stocks will pullback. and baidu is also one of these names. >> let's move on to the next trade. finances among the worst performers today. down more than 4%, capital one financial bank of america getting hit the hardest as they reported the loan delinquencies were up for the month. this is after the paulson investment bounce last week. how do you interpret that master trust data on net chargeoff delinquencies, et cetera from the credit card issuers today? >> i thought it wasn't bad actually. i was mildly optimistic after reading it. i saw bank of america pull back, which we are long, that's not surprising given the run it's had. the story, the fundamental story, bank of america hasn't changed at all today, so i wouldn't be surprised if it came in more, but this is one for the long-term. i'm staying long bank of america. >> and capital one was up 60% in a month. this is a stock that absolutely took off and then that added little boost with mr. paulson,

the fact he's positioned in there, as well. a lot of put activity out there last week on that news, basically looking for a pullback, august 30 put, started to trade very, very heavy trade last week, looking for something sort of pullback near term. those traders were looking at this saying, all right, this is a momentary blip, big move already going into this move. they're getting some of that already. >> take a look at wells fargo on july 22nd, they reported their second quarter. that stock recorded 150 million that day. it closed at 24.45, today the stock closed at 26.30, if you're looking for an entry point, i believe that's it. we talked about again the deep end of the pool shorting these things which i happen to believe you can still do. if you're on the sidelines waiting, i think 24 1/2 that's when you get in wfc. >> i agree. i thought these numbers on the delinquencies were pretty good especially the 30 days. this is really your future trend here. these are a lot better. now, everybody knew that a lot of these bank loans had been

written off 9% and 10%, if you look at the delinquencies, not only stabilization, these things are coming and it's a good sign for these guys, they're not out of the woods, but much better than today's trade. >> wells fargo, another one with a lot of put activity. the stock kept going higher, but the volatility out there has been high. we talked a lot of these banks, volatility, goldman sachs, a lot of the names getting cheap. wells fargo is high. you get an at the money call for $2. if you're willing to jump if if guy is talking about it on this level, you can use the volatility in your favor, sell it for $2, now you're at a great level. >> it was the kind of day where you heard that net chargeoffs were declining month over month. places like capital one, citi, et cetera, then on any other day it would have been a cause for a rally. >> sure, yes, absolutely. i think it's still good news even though it happened today. >> next trade, consumer and housing shares falling and lowe's, misses analysts'

estimates took down at full year. the retailer announcing that profit plunged 19%. this even as builder sentiment reaches the highest level in three months. how do we parse out this data in terms of the housing bottom? the ceo of lowe's saying there are signs of the housing bottom, but not seeing it in his business yet. >> they would see it, but that is a good indicator. i like a name like centex. it was down only about 11 cents today. i really think it's very much a different market locally. and i think, though, something like centex, i believe the bottom is in. i'm going to be long. >> people make a mistake -- they think home depot is going to get crushed. i think home depot is a better company. that being said, if the tape is correct, home depot, taking profits. if you're looking for an entry point in home depot, it's coming, they report tomorrow morning, remember, they raised guidance, i think back on their

analyst day on june 10th. they've told you what's going to happen. if you see a pullback in the name, that would be the stock, not lowe's. >> i think lowe's, they're cutting back on store openings. they talk about trying to open 60 to 65, now it's 35 to 40. it shows you they're trying to be more efficient. those two stocks mirror each other. if you go back to last quarter, lowe's ran up into the earnings. home depot already participated in the earnings announcement. i think today as guy's talking about, when you look at home depot, close to an entry point, waiting for a pullback, might get one more push to the downside. i think home depot looks strong. >> i've got to point out one more thing the xrt, specialty retailers coming in 3% today. it's still -- i still think the valuations are stretched and if we're talking about a consumer that has some head winds, there is still room for the xrt -- >> and again, you have a pair trade on, you're long walmart, short the xrt.

>> a day like today that's a good trade to have. walmart down 22%. the xrt down 2%. so i still think, though, there's more to come in the trade. >> let's move on to the next trade. oil's tumbling below $66 a barrel. waning investor confidence in the global economic recovery overshadowing the first hurricane of the season. also, of course, dollar strength playing into the pullback in commodities across the board, whether it be oil or copper or anything out there. >> well, sorry -- the supply disruption part of this trade, you can just go to sleep and wait for that one in probably a year, i don't think anybody cares, it's about the demand. and i think the biggest move was on friday. i think you hold, i think you definitely hold the 50 days somewhere around 68. i think oil will continue to struggle in this tape. and i do think the rest of the commodities will as we look at the dixie. the dollar index, is that hurting all commodities with the exception, quickly on the commodities, the crb which is

all of those parts of the scrap commodities spectrum, like rubber, like resin, all of these things that speculators can't play on has actually gone up every week since march. so you actually do have some real demand out there, but oil is the big speculators play, with the dollar there, it's going to be under heavy pressure. >> oil services when oil was rallying from 63 back up to $71, they didn't participate, you look, we talked about it, that stock was trading 55 1/2, now as it starts to unravel, you see it move down. again, we talk about that as well. traded down to 50.5 today. i still think it trades down to 49, but at least more attractive levels. >> coal struggling, miners are pulling back? >> absolutely. and we had such a huge run, and we talked about that one last week, i still love the stock, but rather than selling the stock, i liked buying puts and the reason is the volatility was the cheapest level in ten months. so you can still participate for the up side, you have protection to the downside, and volatility starts to explode in those

options, give you even more added protection than you initially put on. so that's why i still like those names. from that discipline standpoint, $55 to $65, got above $65, didn't have the heart to sell the son of a gun, but i like the puts the best. at least you can still keep an eye on some of these names and you can still sleep at night. >> share of the health insurers. reports emerging that the white house may drop the public option part of its health care reform bill. and of course, this is exactly what the health care trade association wanted. they said if there's one thing, we're not against reform, simply against that public option. this is exactly what the sector wanted and here you go. and you say unh -- >> well, i think it's -- i think, listen, we talked about this last week. i don't think there's anything new. i sort of heard the rhetoric last week. that's okay, doesn't matter. you know, again, bold runs end on good news. you might see the end in terms of the short-term. unh has had a good run. personally i'd be taking profits if i owned it. i could understand why you wouldn't own it on the back of this, but i would be getting out now.

>> they struggle each time it's gotten near 30. it pushed up to 29 and change, ten it pushes back up again. pushes up again, pulls back again. all those names today were extremely active, all of them in positive territory, you have signa, all moving to the upside, they all gave back some today. but the options activity out there, a lot of activity going for upside calls. >> i think the industry just did a masterful job of pr. >> of managing -- >> i mean, just letting it implode without their -- >> without teaching it -- >> maybe they did from behind the scenes, who knows, but a masterful job of dealing with what may still potentially be a very, very ugly dangerous situation for them. >> yeah, very true. and we've said it on the show. our political system works best almost when it doesn't work. he mentioned in the note this morning, that's why all of our founding fathers were lawyers. and it's truly what happened here. this thing was set up to fail

and enough chinks in the armour, this thing ground to a halt. it surprised me how quickly the administration has moved down another road. i'm surprised. >> let's move on here. investors fleeing the safe havens today as the dollar rose, but will these moves continue? or will these investments end up being duds? let's head to the pits of chicago. rick santelli, aka the big surf. big sur. whatever you want to call him. rick, what do you say about the dollar? >> you know, it's interesting because i was listening to tim talk about the dollar. and i'll tell you, i don't know if the dollar can have a life to the upside without weakness in the equity market. and i think the weakness in the equity markets didn't start in our time zone. we all have talked about that. so commodities are backing into a dollar strength scenario, as well. i think we have to look for more volatility place to capitalize, pete. buying those puts on equities when the dollar started to tell us it was time to look, that's worked out, hasn't it? >> i think you're dead on.

the idea that people look at the volatility, talk about the vix all day long, but the vix is a great indicator. because of the fact he's truly not just somebody's opinion. that's money going into the markets, that's money telling you -- >> and they should keep rolling them down, keep them right at the cusp of being out of the money, get in that power curve, right? >> absolutely, you want the most bang for your buck. and we saw that on the up side, rick, and if we continue this slide to the downside. >> i want to pick on tim a little bit. and bring your lunch pail, my friend. >> give me your best shot about the commodities and the dollar. >> first of all, i mentioned there is very real demand not just across the speculaors commodity space, but what's going to bring this dollar higher from here? other than people rushing back to cover short dollar trades, reality we are in a bit of risk retrenchment stage, which is going to rally the dollar. >> it's china, though, they got us focussed on it. they were stockpiling down the street. >> i don't think china rolling over here, rick.

>> wait a minute, though, also look at the gdp numbers out of europe? why did they improve? who do they think they're exporting to? >> germany's up 7%, and not just going to china. i'm not telling you the world has recovered here -- >> go ahead. >> but i think at the end of the day we've gotten so far ahead of ourselves that just the way the markets in our country had an established strength three hours before we opened i know which direction we need to look for tomorrow's news. >> commodities are still a strategic resources that not just chinese and others are buying and hoarding, you've taken tremendous production offline, forget about oil and other commodities that matter. it will take some time to get that production back. the minute we see real demand, nobody's saying we're back to 16 million cars, but still demand is 25% of the auto sector and in the fourth quarter that's auto sector that's going to be up. >> a quick question. >> i've got to blow the whistle, rick. >> we'll save it for tomorrow. >> thank you for your time. see you tomorrow. and that was a word on the

street. coming up next, just last week on fast bear, peter told us why the market was due for a correction. after today's drop, he'll join us again to tell us how much further this market could fall. plus, could tech be your best safe haven play? the first cnbc interview with the ceo of king pharmaceuticals. here is what else is coming up. be fearful while others are greedy and greedy while others are fearful. which stocks is the "fast money" picking up as others run from the street? and -- >> that was the right thing to do. >> no, it wasn't the right thing to do. >> this guy is no working wall street stiff. peter schiff on the coming correction. plus avoiding the selloff? there's an app for that. can apple innovations help you beat the indices? one of the best tech investors on the street give you the trade when america's post market show continues. against acid attack.

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welcome back to "fast money," live at the market site in new york city's time square. if the stock market rally isn't based on the hopes of an economic recovery, then the next guest would tell you it's more pain to come. peter schiff is the author of "how to profit from an economic collaps."

welcome back to the program. >> thanks for having me on. >> we know that you are predictor of a correction. how much deeper will this correction be, and will you put your money behind that prediction? >> well, remember, we've been in a bear market since 2000. the rallies are the correction. the primary trend is down. now the question is, is the correction over? and are we going back down? well, there's no way to know for sure in foresight. we'd have to wait for some time. but certainly the market has been overextended, the economy is in worse shape today than it was six months or a year ago. there's no reason fundamentally for stock prices to be rising other than the fact they fell so precipitously that technically they were due for a bounce. >> again, you had it spot on, we've been through all that. to me, if the u.s. stock market goes down, it stands to reason the rest of the world will go down. maybe not lock step, but it is going down. the only trade left for you is being short the u.s. dollar to a

certain extent and long goal. does that trade still work? does whatever happen today scare you a little bit? or is it an aberration. >> i didn't think the dollar was that strong, considering the extent of the selloff. the dollar didn't have that big of a positive reaction, and the dollar index is still trading below 80. i do think at some point you're going to see that trade totally decouple. i don't think that weakness in u.s. stocks is going to be bullish for the dollar. at some point, i think the dollar will start to fall even faster on days when the u.s. stock market is down than when it's up. >> what does -- >> sorry, it's karen. what would you need to see to become positive on the u.s. market? i take issue with your saying we're in worse shape than we were six months ago. >> we are. >> we're not. think of where it was six months ago. >> think about all of the debt we've accumulated to patch up the system. i'm saying what we've done to save the banks has put us into more harm than had we just let them fail. >> you're saying we were better

off if the whole thing came completely unwound, which it could have done in february had we not done anything. >> i don't think the whole thing would've. i think it would have been very painful, particularly for a lot of people getting bonuses that should have been getting pink slips. >> peter, how about house prices, though, that at least have stabilized? we've seen the price index begin to tick higher, and then, you know, if you actually believe the dollar's going weaker, how about these commodities that begin to rebuild some of these houses that should still be running higher? >> i think commodity prices are going to go up, but i think u.s. home prices are still too high and they're going to come down. there's no way around that. but nothing's going to go down in a straight line. there's always going to be a little bit of a bounce. i think a year or two from now, prices will be lower than they are today. >> what's your trade? >> well, i still think there is real opportunities abroad. i disagree that if the u.s. market goes down that foreign stock markets have no option but going down. i think there will be decoupling. i think you can make money in foreign stocks. and i think, in addition to dollar weakness, there's a lot

of opportunities and there are a lot of -- >> peter, peter -- bottom line for us, do you think the better trade is to go long foreign stocks? and if so, which ones? or would you also short the u.s. stock market? >> well, look, i'm giving investment advice, not trading advice. you guys are about "fast money," i'm about money over the long-term. and for that perspective, i think there's a lot of money to be made by buying foreign stocks and getting out of the u.s. dollar. from a trading perspective, you know, i don't know. i don't know what's going to happen in the next five minutes or five days, i can't really say. but i do think that if you're looking to invest money, you don't want to invest in the united states. and you asked me when i would become bullish. i'm not going to get bullish on the u.s. economy or market until we stop making the problems worse and until they reflect the valuation that i think makes sense from a long-term perspective. >> right. >> there's no good dividend yields in the u.s. market right

now, and that's assuming there was a rosy economic scenario in the future, and unfortunately there's not. >> got it, peter. sounds like the -- >> to be continued. >> i'm not a permibear, i'm more bullish than you guys are. >> well, how much lower -- just lastly, i know, sorry, melissa. lastly, how much lower on the housing market? you're talking about we're not even close. how much lower? >> in real terms, there's going to be a lot of inflation, that's going to put a floor under the nominal price, if you want to look at house prices, in relation to per capita income, a an ounce of gold or barrel of oil, i think you can see home prices drop 50 first or more from here, in those real terms. >> thanks for your time. hope you'll come back to "fast" sometime soon. >> we're paid to actually make consistent returns. i can't just make a sweeping statement and kind of be in that trade for as long as i hope that trade works. >> yeah. okay. next trade here, investors have them flocking to texas.

the technology 25% in 2009 alone, if you're inclined to tree tech as a safe haven, you will want to listen to our next guest. tech investor coburn is the ceo and joins us on the fast line with some long-term ideas. seeing the selloff today, a decline of 2.75% on the nasdaq alone, which stocks have buying opportunities? >> we've been seeing all yearlong that speculation and buying weaklings because they might bounce the most has been winning over quality tech names. there's four that -- well, there's a bunch that i like for long-term plays, but also, i think we might see the inversion of this quality versus speculation. and so four of the names i've mentioned, ansis, adobe and apple and sybase. we're in this period of next 15 or 20 years, certainly right now we term naked without data. the idea is i need to have data and figure out how to use it wisely. and all four companies fit into

that theme or that shift that we're seeing play out every day in the world. >> hi, it's karen, let me ask you a question real quick. on apple, how do you get to valuation that you think is right number for apple? >> i don't know the right number. it's a great point. first thing we have to do is adjust the revenue in earnings because apple does this accounting thing where they, you know, mark the phones over an eight-quarter period and that messes things up by about 6 or 7 points. nominally trading at 24 times, it's really trading apples to apples, no pun intended, 18 times. what i've seen with apple has gotten me more excited than before. this is the largest long position. this idea of the application store, they're kind of running away with it, just like they ran away with itunes. developers want to develop on apple's application format. they don't care about palm's pree, and not inspired by nokia's platform.

it's impressive. >> we're looking head to hewlett-packard earnings tomorrow, what is your set-up for that play? >> we're neutral because we very much dislike the business that they're in, but very much admire how they've pulled off incredible profitability. i would be looking at the services margins and see if they can push those up, and if they do, maybe the thing -- maybe the company can continue to perform pretty well in terms of a stock. but we're neither long nor short. >> pip, good to talk to you. >> same here, melissa. scored a victory late last week when the company approved new safer pain relieving drug. the drug works much the same way as standard painkillers but cannot be broken into smaller pieces. reducing the ability of users to abuse potentially the drug. what could this breakthrough mean for king pharma's future in the future of the industry? here with a first is king pharma ceo brian markson.

it's great to have you with us. >> great to be here. >> a lot of analysts have said the stock has run up in the anticipation of the drug. and one analyst said the launch is going to be very important. you'll have to exceed expectations. one estimate is $300 million in 2012. does that sound about right? or is that conservative? >> well, hopefully it's a little bit conservative. we think it's a great product, obviously, with a lot of safety features built into it, and we think it heralds a new age for pain medications. hopefully we'll do better than that. i'd rather underpromise than overdeliver. >> this is actually part of the pharma deal. let's talk about your pipeline going forward. i think that's important. >> right, we have a couple of great projects in the pipeline, going forward, because i think that's important. we have a couple of great projects in the peopipeline. one is called a accuroc. and perhaps one after that remocy. again, slightly different technology, complements embeda,

and we have said publicly that we plan to resubmit the new drug application by the middle of next year. >> does anybody else have the -- you guys are the leaders in this. is this a game changer? >> yes, it's a game changer. i think there are other companies working on this technology. we're aware of it, but we know we're pretty far ahead. >> wouldn't you sell more if you didn't have the -- >> well, that's a great question. when you take embeda as prescribed, the abuse-deterrent feature of the product passes through the body untouched. but if you were to misuse the product, crush it and try to snort it as some people unfortunately do for recreational use, then there's an inner core of the product and it reverses the euphoric effect of the morphine in embeda. if you take as prescribed, sprinkle it on apple sauce and take it if you have trouble ingesting it, it should be perfectly fine. however, we've designed a product here that will make, hopefully, the recreational use unattractive.

that's the goal of this product. physicians can feel more comfortable prescribing a safer medication. that's our hope. >> you follow the space a lot. does the stock run-up scare you? >> it does not scare me. and i look at your name and i know you've already done one acquisition, and i see the consolidation in the sector like crazy. are you still looking for any more growth for the pipeline? >> well, look, the external pipeline is a whole lot bigger than the company. every company has its own finite pipeline, we're always looking outside, but we have our hands full with our own internal products but looking to do a lot more. and you've seen the strong financial management of the company as we pay off our debt and raise more cash, we'll be out there doing more deals. >> there you go. >> thanks so much for joining us. coming up next, it is a trader's market, you better know the rules. a we break down the best ways to play this new trading range. back in a minute.

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welcome back to "fast money"

today's actions reminded us this is still a trader's market. joining us with ideas to stop the trade. jeff, welcome back to the show. walk us through ibm. >> ibm is a great stock. because you talked about this a little bit, we looked it at $100 range and traded between $100 and $108 and then it found resistance at $120. if you were short at $120, you could be making about $4 over the last like three weeks. and that's -- i tried to actually buy ibm today at $116.50, i did not get hit. i was going to see if i could play them back up to that range. >> whenever it's at $116, you would recommend buying and selling. >> you play the range, and it's a great opportunity to take advantage even though ibm is an upward trend, it gives you the opportunity. keep on taking advantage of those four points and it gives you a competitive advantage over a long-term investor. >> what's the range you're

playing in jpmorgan? >> well, jpmorgan, and again, i wish we were talking about this last week, we had a selloff yesterday, but jpmorgan between the $43 and 41 area, that's the range we've been playing. we've been making really good money off this. today it finished below, around i think about 40.60. i'm still long it. not happy about it. >> is the market going to be stalling or going sideways for a while? what do you have embedded in these trading ranges? >> guy, you bring up a great point. obviously when i'm looking at ibm, still looking at the industry, keeping an eye on tech. if tech and the spider start to roll over, i'm not comfortable at the $116 kind of range. instead of getting long say about 5,000 shares, maybe get 2,000 shares but i'm going to be very careful. i'm going to play the range until it doesn't work again. >> thanks so much for your time. time now for today's selloff edition of "pops and drops." bxi was down 5%, tim.

>> and i think it continues to go down. be careful. >> the cat was a drop today down 4%, guy. >> it fell to 47 recently also fell back down to $47 back in january. goldman sachs said they reiterated their $36 price target. it gets to 40. >> you just scared millions of children across the country. >> they shouldn't be watching, then. >> do your homework. drop for bb & t, down 6%. >> two reasons, obviously down with everything else in the financials, face it, doing an offering which is a good thing to be able to buy colonial. >> drop for freeport mac. down 7%, pete. >> painful day, this thing is absolutely in this range, 55 to 65 is the top end of the range. you've got to love that. you've got to love it. got to love it. >> we've got a pop here.

usain bolt. pop for bolt? the 22-year-old from jamaica ran the 100-meter race in 9.58 seconds last night. shattering the previous record he set at the beijing olympics. it was the biggest world record improvement in the event. pete najarian has got some theorys about bolt. >> well, you don't want to do what he did, actually, you don't want to exceed, break the record by too much, you get a bonus every time you break it. every time you break it you get another bonus. >> he was just sort of gliding in there. >> how about the name bolt for a guy that fast? this guy is unbelievable. >> that's being named money trader or something. drop was down 7%, tim. >> i think another of these trades, you buy this stock around 11, trade it to 13.50. >> drop for rosetta stone, down 27%, guy? >> well, i'm laughing because they lowered guidance today, which that's cool, but a couple weeks ago when they reported on july 20th, they raised guidance. what changed in a month?

less people now are trying to learn the language? you folks, you've got to get your act together over there. stocks went down today, it'll go down more. >> and a pop here again for people. najarian, steve and his wife lisa celebrating their wedding anniversary today. >> that's nice. >> look how handsome and happy. >> i'm not sure that's a pop or drop or what it is. pop for me. drop for my wife. >> how many years? >> hey. >> how many years? >> you know, i can't keep track. i have no idea. >> oh, that's a big drop. >> i think what he's trying to say, he has a career here with his wife. >> i can't afford any -- >> stop. coming up next, we go digging for bargains after today's selloff, our traders give you the stocks on their correction shopping list. you will not believe what the traders are buying. back after this.

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all right. let's hit up the poll. poll of the day. nice question, was today the start of a 10% correction for the market? "a," yes, get out. "b," no, resilient tape.

log on to fastmoney.cnbc.com. to vote. there is no gray area interest. time to head to our props desk. of course after today's selloff, there could be some hidden gems within the rubble. so, tim, kick it off. >> i think exxon's a great place to look. you talk about dividend yield, but i'm watching a range trade between 66 and 74 for a company with $30 billion of cash and oil prices that are stable here, even if they hold $65, this company makes a lot of money. i like exxon here, i think this is a fantastic company. i think they will be buying cheap companies in this space and adding value with that cash. >> i'll go to intel, clearly best in breed, but the stock did not -- as much -- as well as it did, got up to 19.5 and did not participate in the last half of this rally. now i'm looking for a pullback in intel. i think it trades with a 16 handle, probably 16.5 to 16.65. that's what i'm looking at. >> i like it because they are spinning off their natural gas component, which is jack ups, which was not doing well.

i like pde here. >> at what level? because last week you recommended pride, as well. >> well, if i like -- >> i like it more. which i do. >> pete? >> microsoft, i think they missed the cycle without the cycle the stock's still trading up on the year, they've had a big run already. i realize that, but again $30 billion of cash, small dividend yield, buying back shares, i like the deal with yahoo, i think they got the right side of that. >> bing -- >> bing, bing, bing. >> i like the direction they're moving right now. >> there you have it. >> it's his anniversary. he's a happy guy. loves lisa, loves microsoft. coming up, hewlett-packard and target on deck to report earnings this week. option traders making serious bets today. how are they playing it? the answer when we come back. e. take 2 extra strength tylenol every 4 to 6 hours?!? taking 8 pills a day...

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i'm bill kurtis, and wherever i go, i've got plenty of room for the internet. and the nation's fastest 3g network. gun it, mick. (announcer) sign up today and get a netbook for $199.99 after mail-in rebate. with built-in access to the nation's fastest 3g network. only from at&t. welcome back to "fast money," live at the nasdaq market site in new york city's times square. two key tests to the market tomorrow when retailer target and hewlett-packard report earnings tomorrow.

few markets predict what stocks will do better than the options market. and for a look at how traders are setting up for tomorrow, we check in with "options action" contributor mike coe. some might call the options market a crystal ball. what are they betting in terms of a target? >> well, i don't know if it's a crystal ball, but it's definitely a good place to look if you're interested in seeing where people are trying to make some bets going into a catalyst. target, we saw a lot of near dated put activity buying august at the money and just out of the money puts, but i think before we take that as a bearish bet, we should note there was fairly substantial call buying, as well. the thing i would highlight about target, this is one of the names where implied volatilities have dropped a bit, making it possible for people to make directional bets into a catalyst like this. >> in other words, imply volatility comes down for prices of options go down also, it's cheap to buy the protection. >> that's right. and to give some perspective, you're talking about a stock a little over $40 and, you know, you can make these kinds of directional bets and you could buy, say for example a call that's about 80 cents on the money and the premium about 65

cents. that's basically about 1.5% of the stock's price between now and friday all in exchange for being able to make that leveraged bet. >> and for hewlett-packard, how are option traders betting? >> hewlett we saw a notable trade, 42.5. this is a trade that's going to be most profitable if the stock trades at 40. they actually sold more of those 40 puts than they bought of the 42 1/2. that means they're comfortable getting long the stock, but that's still down 5% from where the stock closed. the most notable trade is suggesting that the stock's probably going to drift at least 5% lower by the end of the week. >> and you know, mike, what i like about the hewlett idea and i saw those puts trades, as well. very, very active. what i liked was the explosion in the volatility as opposed to target where you've got this volatility into an earnings, into an expiration policy, putting premium there where you could buy the september and sell the august again. >> i think that's actually a

great play in many instances going into a catalyst unless you think the move is going to be really sharp and going to be lasting. that's probably one of the situations where you don't want to get into those calendar types of trades. but one of the things we have been seeing as volatility's been drifting lower all summer is we have the opportunity to buy options, and you know, make these kinds of plays and do it in a hedge way. >> mike, thanks so much. mike khou also an actions trader. we've got a new time slot every friday night. final trade after this. i'm racing cross country in this small sidecar,

but i've still got room for the internet. with my new netbook from at&t. with its built-in 3g network, it's fast and small, so it goes places other laptops can't. i'm bill kurtis, and wherever i go, i've got plenty of room for the internet. and the nation's fastest 3g network. gun it, mick. (announcer) sign up today and get a netbook for $199.99 after mail-in rebate. with built-in access to the nation's fastest 3g network. only from at&t. even during times like these, there is a light beginning to shine again. it comes from a restaurant downtown. a shop on main street. a factory around the corner. entrepreneurs like these are the most powerful force in the economy. the reinvention of business begins with them. and while we're sure we don't know all the answers, we do know one thing for certain: we want to help. come see what the beginning looks like at openforum.com

find out who lost the most money today. and it was john paulson made the headlines last week with his new bank of america stake, but now takes the fall as his 168 million shares fell 5% resulting in a paper loss of more than $139 million on that 5% decline in bac shares. >> you've got to really stretch to try to put this guy down. you could pick this intraday trade, but -- >> all right. okay. final trade -- >> u.s. steel, i think the steel stocks will recover. they've had a great run, only half the move down, buy u.s. steel at 38. >> do some homework in king pharmaceuticals. below ten, it's interesting. >> karen? >> take away my pride. just called me on it. i'm sticking with it pde.

>> to follow her up, microsoft. i like everything else going on. >> i'm melissa lee. thanks for watching. see you tomorrow on the "halftime report." tomorrow at 5:00 p.m. for more "fast money." (marco andretti) i race to win. i know when it's the perfect time to change my tires. when it comes to shaving i know when to change my blade. (announcer) gillette fusion's indicator strip fades to white when it may be time to change. fresh blade. better shave. the first complete women's multivitamin in a drink mix. with more calcium and vitamin d... to support bone and breast health... while helping you hydrate. one a day women's 2o. refreshingly healthy. - oh, come on. - enough! you get half and you get half. ( chirp ) team three, boathouse?

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