you look at the canadian dollar, you look at the australian dollar, that tells you about the global economy. but getting back to the market for a second, if you look right now where we set up heading into the federal reserve meeting, we keep talking about the market being overbought. i talked about that the other night. the market clearly is overbought. but when we just kind of sit here in this congestion, consolidation phase, that works off the overbought conditions. and what does it do? it places money managers in a very, very precarious position as the end of the year approaches. and it also brings about the possibility for a super spike. a super spike that takes the s&p above 1,100. that is on the table right now. >> it's 20% above its 200-day moving average, which is why you're saying it's overbought, essentially. that's -- beyond the 20%, 200-day moving average? >> i think that absolutely right now is on the table. >> 400-day moving average. >> and it defies all the logic. it defies all the bearish

fundamentals right now in the economy and the marketplace. but it is a possibility. >> we're not laughing at the 400-day moving average. we're laughing at that hedge fund manager out there who pointed it out to you. >> dxy super spikes tonight. >> it's a very exciting show. >> two words for you. >> what? >> lou mannheim. do you know lou mannheim? >> it's one name. but what? >> two words. he said, kid, you're on a roll, enjoy it while it lasts because it never does. for you wall street fans out there, you know what i'm talking about. and the market's on a roll, and enjoy it while it lasts because it ain't going to last forever. but that being said, you know what? the market still wants to go higher, you can't fight it. but there was a trade today that sort of cropped up for me. aig, did you see the reversal on that stock? >> yeah. >> i'm going to talk about it now. made a 55 high a couple weeks ago, basically traded up there again, reversed. huge volume back then. 130-something million shares. 122 today. for those folks out there that really got a set, you might want to short aig here. you know what i'm talking about.

>> what are you talking about? >> this thing traded down to 32 in three days. the last time it traded 55. it's setting up for another move like that. >> september 1st we talked about the s&p was hanging around 19,000 level and the hedge fund managers and all the money sitting on the sidelines, and sooner or later they've got to start putting it to work because they have zero performance right now. well, they're slowly trying to get it to work and on every pullback they try to put a little something to work and they keep on chasing this thing higher. when you look at the market every single day, the selling pressure just no longer exists. and i took a look today i was looking at the s&p 500, when you get down to the 106, 107, 105, all the way down to the 100 level of the spiders right now, you've got 300,000 to 400,000 options on the put side. same thing for the quad q. all the way down to the 39 strike, there is over 6,000 open interest on the put side. what's that telling you? it's telling you the protection is there.

the fear factor, the selling pressure, it's just not there. and people continue to talk about, well, it's not going to do this, it's going to do that. all this news. the dxy this and all the rest of this stuff. i'll tell you one thing right now. the market is moving to the up side. each day we get a different leadership role. today we're starting to get financials into this thing. i tell you what, if goldman sachs, if morgan stanley, jpmorgan break out of this area, which they look like they're about to do, hitting 52-week highs, this thing has a lot more legs. >> let's talk about that just briefly because we did have morgan stanley, goldman, as you mentioned, 52-week highs there. that seems like a very good sign because on a pretty flat tape those stocks managed to attract some buyers out there. so there are some people, it seems, with money on the sidelines willing to pull the trigger when it comes to some of these higher-quality stocks out there. >> and you just don't have to go high quality. we tried to laid the right we tried to lead you in right direction in terms of financi financials. look at raymond james today up 7%. that's a huge move. you know why? because they reported assets under management yesterday, i think they surprised some people. $214 million. raymond james is another stock we tried to lead to you. greenhill, ghl, 52-week high today. yes, a lot of stocks. ghl think it goes to 90.

there are other stocks other than the ones we talk about all the time to me the greenhills and the raymond james still work. >> morgan stanley clearly has broken out above 30 bucks. if you look -- there's another one coming. wells fargo. approaching $30. and the cme gives you the read on the capital markets itself. cme is sustaining above 300 bucks. that is bullish for the capital markets. >> if you look at where goldman, morgan, and bank of america are year over year you look at bank of america that's really the chart that gives you the most up side if you think there's normalized earnings. they, i would argue, have taken more of the competition out than even goldman. if you listen to jpmorgan, their asset-backed folks were saying in a strategy piece they think the write downs are over, they think we're 75% of the way through this, which means the next shoe to fall is going to be a slipper. it's going to be a slipper, maybe a slipper you're wearing in bed like you wore last night on the show. i don't know. >> that was karen, not me. i don't wear slippers. >> okay. the bottom line is for the guys that have the most exposure to loans, to mortgages, to the consumer, those will be the

guys, if, in fact, j spchpmorgas right, i would want to be on top of. and if you look at a chart banks of america is a lot more interesting to me than looking at gold. >> and you can see an unbelievable bang for your buck. but i don't necessarily agree with you. i love bank of america but goldman sachs talking about 2.25 from 1.80. that's where they moved their -- they're looking close to 20 bucks is what they're projecting for 2010. goldman sachs is the best in breeds. everybody loves to hate them. they love to hate them because they do things right and if they continue to do things right the equity markets continue to improve goldman sachs will be over 200. >> it's one of these stocks, though, that if people out there feel got away from them there, was another chance -- 52-week highs now. what point do you start to think i'm going to pull the trigger here? >> i'll tell you, i'll give you the answer. the same answer i've given the last couple weeks. buy morgan stanley, buy some puts. it's the lowest volatility you've had. each day the volatility gets a little lower. you can buy it at a 52-week

high. you can still buy these stocks, buy yourself some puts, and you have the protection at the lowest level in not just months. in years. the volatility has been crushed right now in those stocks. >> so get in -- but buy the puts? >> that's exactly what i've put on in most of those names. >> you've highlighted what every manager right now on the street feels. it's maximum frustration. why? they're not getting the correction. and you're talking about in a declining market you have margin calls and a forced liquidation to sell. it's almost like right now as we go higher and higher and the end of the year approaches that buyers are going to be forced to have to buy. >> i'm going to guess on the other side -- you don't see a pullback here -- >> don't do it. listen, i'll say it again, you can't fight it. it wants to go higher. yes e think. but the pullback to me is going to be more than just a pullback but it ain't happening anytime soon apparently. >> okay. with that said, let's move on to the gold trade. of course that's the corollary to the dollar, making a new run at a new record high, snapping a three-day losing streak to

settle at 1,014 an ounce. 1,014 an ounce, who'd have thunk that? >> that's low. >> well, that's low if you take a look at the high back in 1980 was $850 an ounce. if you inflation adjust that forward to today we could see gold trading $1500 to $2500. that's according to jpmorgan. throwing it out there. if we are to adjust for inflation gold should be much higher. >> and i think a lot of people would have thunk that. we've talked all along for the last three weeks with the consumer exposure -- gold has become an asset allocation, if you look at the gld, all these etfs. this is not a big surprise. and when you also factor in that some of the biggest institutions in the world own goldman, it's not just a trade for them. if you go back and look at these people like paulson and whatnot. we've done a lot of analysis of it. but don't look over the last quarter, look at the last five quarters. these guys were in this trade, maybe not the same size. they're not going to be out of the trade next quarter. this its part of their allocation. >> and the gold futures market is doing you a favor right here,

providing you a technical range to give you guidance what to do with the trade. 996 which was yesterday's lowish breaks below there you move to the sidelines in the trade. it is having trouble getting above 1025 right now. if it takes out the bear stearns high, i know timmy doesn't like that word, but if it takes out the 1033 high from bear stearns you've got to be in the market. you've got reference points on the gold trade. >> i'm looking at the gld it's up 10% so i can understand why we talk about gold every single freaking day on this place. >> easy. easy. >> 10%. it's up 50%. why? copper. they also have gold, exposure to gold. but go to the areas giving you the biggest bang for your buck. weak dollar timmy talked about it at the top. everybody's looking for the commodities. forget gold for the moment, look at the places you're seeing explosive moves. today 52-week high, we talked about freeport-mcmoran momentum being dead bottom. i mean it is rock bottom right now. somebody came out in november. 75-80 call spread. they bought it. why? because it's really cheap. it gives them an opportunity. 10,000 of these traded today. an opportunity if it can

continue to the up side you've got yourself an opportunity with very limited exposure. >> to the point of the miners and john tolson investing in some of the miners as well he invests in gold but also invests in the miners we made the point yesterday that these miners are overpriced. maybe at this point -- because these are 13 filings. these are as of the latest quarter. >> they are overpriced, but people will buy them. and they'll work -- >> but does that logic hold? >> no. i think it is faulty logic, i'd stay away. the one name we have led you to, the old walter energy is up 7% today. you talk about gold being up or whatever. this stock's up 320% since march. and petey's been on it for about 319% of it. that's a name that works. still a short interest there. buy wlt -- >> heat has also been on the coal names. in addition to you that want to talk about natural gas right now. i truly believe natural gas has found a bottom, enough of a bottom that you can go in and buy a lot of these equity names, apaches, xtos, eog. natural gas, listen to president clinton this morning, it is going forward going to be the

transportation fuel. it's part of the solution and i think natural gas levels have found a sort of bottom. >> but even though storage levels are at a high, you think natural gas levels area at a bottom? >> i think those storage levels will be worked off very quickly, clearly there are bearish fundamentals in place but i think the market has already priced that in. >> and wait till that happens. and i agree with you, by the way. i think at some point that's going to work. i don't know when that's going to work for natural gas in the meantime you lean on metallurgical coal. i tell you what, peabody energy c.e.o. was talking about that today, he talked about coal, but also thermal coal and the demand is real and it's there. >> look at metro steel, mtl up another 10% this is coke and coal metallurgical coal one of the best plays one of the best assets in the business and if russia is rerating like we said it would and like it is you want to own this one. >> just quickly on walter industries because we're all talking about you and your plays -- not here. walter energies. what do you do?

guy makes the point that you rode it up 319%. >> i think you're always looking for new opportunities. this name has hit every target but it seems like every time it hits a target all the analysts come back out and said you know what we were a little low we're going to raise that target. >> so you're in it -- >> no. i still think it we can play these names. a little safer though they continue to move. joy glubl, bucyrus. bring them up all the time. volatility's low, earnings already past, you've got yourself positioned for the next quarter to still participate. >> let's move on to the next sector, the next trade here. applied materials seeing a deal with een solar. amat closing higher by 5%. the ceo on the sidelines of a conference in germany also talking up the solar business, this is something we've been all over, pete in particular when it comes to applied materials. >> and we all look at applied materials and it's not just about solar but solar obviously becomes a bigger and bigger revenue stream for these guys. they're talking about a billion dollars when they report -- coming up on october 25th. this is an industry they still expect to have 20% margins next year.

they still expect growth. so if you're looking at applied materials and you like the energy play off of it, the solar play off of it, obviously things are starting to grow. he loves it long term. the ceo did talk at the hamburg conference, talked about short-term, there's a lost bumps along the way here but long term phenomenal exposure. >> this is the second re-alignment in two years. you can't love that. you're buying this on a flair because valuations don't make sense but this is one of those lottery tickets that's working could still work breaks out above 14. amat's okay. i think the down side is limited to perhaps 11 1/2, 12. the up side is pretty tremendous if they get things right. >> hate to bring up a buzz kill in today's market but i'm going to go ahead and do it. biotech losing yesterday's big momentum. the sector etf, which is ibb down more than 1%. traders await developments out of the ubs life sciences conference. pete, it's a long roster of names out there, we had some chatter about all sorts of names, biogen idec for one. which ones are you watching? >> i still lean on celgene. robert w. baird gave them an upgrade, new price target, all

the rest of that stuff. on a pullback today it gave you a little bit of a pullback, probably not enough. i tell you what, one of the names i keep a close eye on was amgen. amgen was getting punished today. i think the opportunity's going forward and there are plenty of catalysts before the end of the year. keep an eye on amgen as well. >> amgen was up huge yesterday, today was more of a correction than anything else. they're looking at 1.5 billion in revenue from the bone therapy drug they have in place right now. better than novartis' drug. but if you look at the exposure to biotech what's the best play i think it is getting it through the etf you look at something like the xbi. that's how you get your exposure. you don't expose yourself to the tremendous volatility this space provides. >> let's move on and talk about how you should set up for the fed decision which will be out 2:00 p.m. eastern time tomorrow. you know who's watching it very closely. >> who? >> the big sur, the one and only rick santelli. >> the best. >> the best sur. maybe that's your new nickname. rick santelli, tell us what we should expect in terms of the statement and any sort of

guidance on what the fed might do to reel in all that easy money. >> well, you know, it's kind of interesting because in the last several hours there have been numerous stories written that the fed has been talking to wall street about doing some reverse repos. that sounds complicated. viewers, i'll make it easy. they're talking about getting out a mop for the puddles of liquidity. maybe it's just talk but it's a step in the right direction. listen, don't look for a lot of glitter tomorrow. they'll probably have some new forecasts. their old forecasts didn't work out particularly well. the real key is the buybacks. they're out of money on the treasury side. they probably have about half a trillion left on the mortgage slash agency security bundle of money for repurchases. my guess is they might actually punt this one, let the treasury purchase slide through and sunset, but maybe make the comment they could use the pile they have left to maybe buy treasuries as well. that would be as bold as i could see the statement. >> hey -- sorry, rick, didn't mean to cut you off. i apologize. it's joe. i want to ask you on the assets the fed is actually holding right now they were about a

trillion dollars in value a couple months ago, now the estimate is somewhere around 2 trillion, who knows what they actually are? but at some point they're going to sell the stuff. the question i have for you help me out, i'm not sure who's exactly going to buy, are primary dealers going to step up and buy this stuff? >> well, especially considering we've all figured out the primary dealers have probably been the new decent set of buyers along with some of their big domestic accounts. i think you've just hit on the big story. when interest rates start to move up, who's going to buy the balance of the fed's holdings? who's going to want to hold goldman? there's actually a thing called interest rate negative carry. i think it all happens around the same time. they talk about markets and diversity. many markets, many countries' markets all seem to be moving 100 miles an hour in kind of the same products overall. >> yeah, but rick, when is that going to be? because i mean spreads have compressed so much in the corporate space, for example, it doesn't look like we're anywhere near that and -- >> no. and they've been buying junk the last couple days like they're

giving this stuff away. i don't think it's going to happen anytime soon. but trust me, when it does, we're not going to have to debate is the time come yet. we'll be wearing our helmets and we'll know. >> got to break in, we've got some breaking news here. 518. you know what that is? the start of fall. the start of fall. rick santelli, thank you so much. >> of what? >> of fall. >> it just started now? >> 5:18 on the clock. >> i get to wear my scarf. >> break out the pumpkin. >> exactly. speaking of fall, coming up next, our fall outlook on the sectors that could heat up as the weather cools down. plus all this coming up. it started the market and economy's downward spiral, but is this housing sector finally rebuilding? it's the trade of the week, and the street's top analyst gives us the blueprint. and after a year that sent many of wall street's biggest names packing, is this street survivor ready to take charge? plus "fast money" viewers, come on down.

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welcome back to "fast money." we're live at the nasdaq marketsite. time for effective trade. s&p retail index hit a new 52-week high intraday at least with the gap, tjx aeropostale all hitting new one-year highs. 10% of that index hit 352-week intraday highs today even though it finished lower. will the retail trade be the one to watch this fall? pete, i know you've been talking about tjx favorably. >> strong and the buyback was big for them today. obviously that helped push them up towards the highs. i will tell you another name -- jon and i had a fight not long ago on the show. on the show we were talking about pepsi -- >> that's right. >> molson coors. and i'll tell you what, going into the fall if you look at a chart of molson coors, always seems to do well in the fall, football season, makes a little bit of sense. and pepsi. i think both those names very safe, very defensive and if you look at their performance during the fall, great names going in. you remember that? >> beer is good for your bones -- >> i remember that very clearly. >> that's a lie. >> no, it's true. >> he got it off the interweb. >> so it must be true. >> just saying -- >> you know timmy's favorite store is buckle. i don't know if you know that. timmy, you shop at the buckle all the time? >> i've never even heard of that, joe.

i'm trying to model myself after you but i don't know what we're talking about. >> take a look at buckle. we've talked about it a lot times on the desk. buckle right now looks like it is back in play. >> abercrombie & fitch is a short. i'll say it again. gap's been working, home depot. those are the ones we've been trying to steer you toward. but a & f don't make sense in -- at these valuations. >> you short it. >> those glasses are great. >> you like them? >> did you get those at buckle? >> i don't know, joe, can you get those -- glasses at buckle? >> i've never been to buckle but >> we know you go to buck m. you shop there. no doubt about it. >> sure. >> the youth shop there. >> well, there's no question i'm a hip young thing. >> the youth shop there. >> look at lowe's today, too, which got knocked down about 4% on the impairments they're going to be taking for store closings, et cetera. i think this was an overreaction. guy likes home depot you like lowe's for the same reason. the housing numbers, the housing price index out today. three months in a row we're getting belter data. these guys will be getting a run. >> how about the online walmart, amazon? 95.40 spike high back on july

23rd. it's back up there again -- trading 90s. >> its that shirt from chess king? >> let's move on here. this is getting a little bit -- >> there we go. thank you. >> thank you. >> with that, let's take a look at the housing sector. certainly it is on everybody's radar. while the home builders index has been outpacing the s&p 500 this year recent data has led to a halt in these stocks. third quarter losses. today's disappointing home price. are we heading for an autumn correction? joining us the top-ranked u.s. home builder analyst david goldberg. david, you write that you're expecting an additional 20% to 25% pullback in this sector. how strong is your conviction? i.e., would you recommend shorting the index? >> you know, it's fairly strong, to be honest, but the question really here is timing. right? the whole issue is what's the timing and what's the catalyst? and i think that's what everyone's having a hard time getting their hands around. the home building stocks are definitely overvalued at this point. they've run really significantly. they're pricing in a v-shaped recovery in terms of home prices.

we don't think that's going to happen but the question is what's going to bring the stocks down what's going to move the valuations more in line with fundamentals and it's really hard to see that right now. >> so you have no idea what that catalyst to the down side might be? >> we have a pretty good idea what it could be it's a question of when it could be could it be higher mortgage rates sure. could it be losing the federal tax credit? absolutely. if it's not extended. could it be weaker demand and higher unemployment? absolutely. the question is when is the hard part to decide. >> goldy, what about the foreclosures looming out there now and all these arms that are going to reset? do you have that modelled in? >> huge issue. hard to know how well the government's plan to stop foreclosures are going to work. really a huge unknown, potential negative catalyst in the group. and add to that think about shadow supply, right? which is what's already in the foreclosure process, what's being held as r.e.o. by the banks but isn't actually being put up for sale at this point. there's a lot of shadow supply. in some markets we've heard it's as much as two times what's already up for sale. so you could have two times as much inventory that is sitting there waiting to come on the market.

both are big issues. potential negative catalysts. it's the timing that's harder to get your hands around. >> hey, goldy, i'm sorry, this is guy's name he's given you. >> it's been that way my whole life. don't worry. no, i don't mind at all. >> when you look at some of the data we're getting on spreads in the mortgage-backed space, do you see that trickling into the reality for a lot of these buildings here? in other words, people are actually seeing some house improvement in terms index prices and it's actually giving a bid to some of the builders as people are coming out of their shells. >> yeah, i think that's there. i think what's really bringing people out of the shells is look what's going on from affordability perspective, what's bringing people into the market and that's what you're seeing from the demand data. right? people are saying hey, look, it's pretty similar pricing to rent as it is to own, the government's going to give me a tax credit for 8,000 bucks, it probably makes sense to go out and buy right now. if that tax credit goes away, if mortgage rates go up. if prices go up on homes at any point, you have some issues there you have to deal with. >> david, it's joe. real quick on lennar yesterday, took a $117 million write down on inventory. are other home builders going to follow? is it a pattern we should be

concerned about? >> i think we definitely always look at impairments. when they come down, as you look at it kind of sequentially. i think they're going to keep coming down but you can see a chart of what we saw at lennar here's 120 million, here's 150 million because they're so variable and so hard to predict. but i think the trend is down generally sequentially. >> and just quickly, goldy, as it were, which are the stocks in your universe that will see the biggest fall? >> i think you want to get the guys that have the most exposure to land market. and we've been negative on d.r. horton and pulte. both companies big land positions. we think the stocks are overvalued, they're going to come down. obviously, some of the higher beta names have done really well lately. we think that's a dangerous short especially because the timing's real soft. and we're generally on the sidelines with the group. >> david, thanks for your time. thanks for being such a good sport as we throw our -- >> who's david? >> who the heck is david? goldy. >> real quickly, two trades that have worked outside of this country. in brazil, homex, hsm, the house building market in latin america going through the

roof. in the upgrade in brazil only helps that story. watch these names they're going higher. >> like a heavyweight battle. david told you, ubs a little bearish on d.r. horton. the other side of that trade goldman that's their best name. d.r. horton if you look at what goldman's talking about there. that is a buy. >> let's move on. getting a little bit of options action in here. of course you want -- 52-week high today. there was all that chatter surrounding a possible nokia bid. we also saw call activity up today following a very busy day yesterday. how do we interpret all this -- >> the last four days in palm it's not just been about the stock it's been about the options. it traded 200,000 the other day, traded another 150,000 today. options have been flying out of there like you would not believe. the stock also, the volumes are incredible. a lot of this is various chatter. i'll tell you one thing that has nothing to do with chatter. huge short interest right now in palm. this stock keeps going higher. 30% short. at least that's the last report i can find. that is also pushing this higher.

inkredab inkredable -- incredible activity in the money calls, but also extending up into the out of the money calls as well. and then take a look over at another stock. real networks. this thing was absolutely incredible yesterday. this thing trades really like an option. it was a $3 stock not long ago. yesterday unbelievable. 43,000 total contracts. this thing trades virtually nothing. and then yesterday started buying the january 5 calls. 15 cents, 20 cents. they've already doubled. a lot of folks were in, have already taken some off. i'm one of those folks. but i still think there's more to the story. keep an eye on -- >> just to button up the palm-nokia conversation, we did put in calls to both companies. they did not return calls for comments. we did ask for a comment and got nothing, nothing from them! >> didn't call us back? >> didn't call us back apparently. >> rude. >> but the market did not reward nokia's stock and i don't think you saw the same kind of activity in their shares. so i don't think this is really a great -- >> you're a shareholder of nokia. so would you like to see that sort of deal? >> i don't think they need to do this. i'm going on record. i'm going to say that these guys don't need to overpay for palm here when in fact they already are the leader in the smartphone space. they have the same technology.

i think they have better technology, they're changing their games on apps, they're changing their game online. i think they're coming on. >> i completely agree, by the way. and i tell you what, i agree on nokia. and the problem is they want north american exposure. all they've got to do is cut their price. something we've been talking about for a long time. the pre, a lot cheaper than any of these e-71s and all the rest of these gadgets that are so great that they've got. that's their problem. >> i want to do a little poll action. >> huh? what? >> poll of the day. i've got to squeeze that puppy in. the music's playing. all right. i'm not going to comment on that. what is the best trade for the fall? >> a-ha. >> a, retail. christmas will be better than expected. b, tech, stick with the hot hand. c, banks, the fed to keep money cheap. or d, gold, stay safe. log on to fastmoney.cnbc.com. let us know what you think about that or anything else for that matter. coming up next bernanke and company gathering in washington today for a two-day meeting. will they hint at their exit strategy and what's at stake if they take the punch bowl away too soon? we'll have your preview right

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welcome back to "fast money." here's what we've got coming up

for you in the second half of the big show. move over, drew, or bob barker, for that matter. guy adami is the new "price is right" ringmaster. he'll break down your best entry points on three key names. >> two. move on. >> two. we'll save the last one maybe for the web extra. >> yeah. >> also we've got a new whale on our watch list. we'll tell what you he's buying now and if you should follow suit. one street survivor bank is up more than 200% from the bottom. is its run over? we will answer that. but first time to take your position. the fed kicking off a two-day meeting this morning. the question on everybody's mind is what will they say about their potential exit strategy from remarkably low interest rates? effectively zero. with us now is simon hobbs, former award -- he's currently -- he's still an award-winning anchor. but he used to be a cnbc europe closing bell and europe tonight. now he's here -- >> i used to be in the crucible where it all happens here with the traders. >> exactly. here under the spotlights. >> the leaders -- >> everybody knows that. >> now they do.

they didn't know it before but now they do. >> now they do. simon, what should we expect from the fed if anything? >> i think the -- i'm not going to add anything you that guys don't already know. you've got fed pumping massive amounts of liquidity, printing money, 1.5 trillion dollars. perhaps they're going to say they're going to print even more money. the point here is surely that a lot of smart people are saying we've got a bubble, and you guys are playing chicken with the market. you know, it's all in what you say. but the big issue here is the market is massively overbought and you're saying to people, well, you could still buy this as long as you can get out fast. >> isn't europe pretty frustrated because the euro going to all-time highs against the dollar and in fact that's going to hurt the recovery in europe and it's really at the expense of this fed policy. the ecb has been more restrained than the fed. i don't think they've been holding the pursestrings too tight. but isn't there a little bit of kind of rancor and anxiety and frustration over on the continent over what's going on here? it seems like there should be. >> yeah, actually there is a view if you listen to what the german leader angela merkel was saying, that you guys are way

out of line. they had the hyperinflation in germany and we all know where that ended up. she's openly criticized what the fed is doing here quite clearly and told the european central bank to get back in its box and stop talking about buying assets. the issue here is for many people in europe, that for a long time monetary policy in the states has been driven really for wall street and we've seen the way you guys are enjoying the rally and enjoying the game of chicken in a terrible economic situation. and also -- let me finish. also monetary policy that has run out for the sake of the u.s. government. if you've got such expansion as you have at the moment, absolutely crucified those who run up debt like the government ultimately can have those debts erode. we saw that with greenspan, coming out of dotcom, when you had the interest rate flows and the rates of inflation. time and time again we see the dollar falls and who is paying at the margin for your wars in iraq and afghanistan? it's the middle east. it's europe. it's everybody else like china who's bought the -- >> so there obviously is some

frustration over in europe. but the bottom line here is really isn't this the horse having left the barn? at this point we're not talking about fed easy monetary policy of the early part of the millennium. we're talking about recovery from a crisis. and if you read every one of greenspan -- excuse me, bernanke's books, he'll tell you he's a student of history, he's not going to repeat the mistakes of the great depression. he's not going to repeat the mistakes of the bank of japan 20 years ago. so what do you do about that? again -- >> i'm not a central banker. i would suggest that greenspan made an awful lot of mistakes that got us into the position we're in right now. all i'm saying is let's see quite clearly what is going on here because an overbought, inflated market that could come down quite rapidly. question, when you say buy jpmorgan, do these guys at home, retail investors, often last into the game, will they get out in time? >> they don't have to. that's the beauty of it. >> will they get on the -- >> here's the beauty of it. for the folks who don't have any education on options whatsoever, that's why you've got to have that education. that's why it's an explosive world. and that's why it traded 27 million contracts and sets records almost every single day. 15 million contracts a day this year, 2009. and why? because people are buying

protection. you can buy jpmorgan and you can buy your insurance policy on your ferrari. your jpmorgan that's running like you wouldn't believe. at the cheapest level in two years. that's why you can still buy this market. >> hey, simon, now that you're here in the u.s., listen, you've got to be a bit of a cheerleader. there's got to be something now that you're in the heart of capitalism that you like about america. what's the one thing if you were investing that you would buy right now? >> you can't ask me to -- >> come on. sure we can. >> no. okay, i'm not going to -- i can't pick stocks. that's not my job. >> would you buy gold? what do you think of the dollar? is it energy? you're here on u.s. soil. there's got to be something good that we do here. what is it? >> okay. he can't -- he can't pick a stock like i can't pick a stock. i mean, we're in the same boat. if you do believe that the dollar is sort of on this path for weakness until the fed starts raising interest rates, then logically energy would be a good bet, for instance. >> but let's not dress up -- you guys earlier were saying buy the commodity currencies. you know, this is a recovery

play. that's not necessarily the recovery play. it's a lower dollar play. you're talking about -- in -- a lower dollar play that doesn't mean the world economy in total -- >> and isn't that really the dollar getting its comeuppance? i don't think -- there's a price to be paid for all of this. there's a transfer of wealth going on and it's going to china and it's going to brazil and it's going to the parts of the world where they run a fiscally sound balance sheet. so i think your frustration is actually, you know, seeing an outcome which is going to be following that line. >> my frustration -- >> last word. >> the united states or europe that is going to be massively taxed as a result of what is going on. and the best hope we can have is that these multinationals get into china, india, and get some growth back because china is still stomping around the world with a very good balance sheet buying up assets left, right, and center, and we're navel gazing. >> they're buying it up. he's right on. >> simon, great job. welcome to the united states. >> thank you. >> we've got to extend this conversation a little further. >> okay. >> come on back. >> coming up next, the negotiator breaks down your best

entry and exit points on these two names when we play "the price is right." come on down! you're watch ing "fast money" on cnbc, first in business worldwide. (announcer) when you buy a car what are you really buying? a shiny coat of paint? a list of features? what about the strength of the steel? the integrity of it's design... or how it responds...in extreme situations? the deeper you look, the more you see the real differences. and the more you understand what it means to own a mercedes-benz. the c-class. see your authorized mercedes-benz dealer for special offers through mercedes-benz financial. vroom... vroom. okay, time's up.

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welcome back to "fast money." we're live at the nasdaq marketsite in the heart of new york city in times square. inside every trader is a smart shopper scouring the aisles of the stock exchange for trades that are on sale. no one does it better than the man on my right. they don't call him the negotiator for nothing. guy adami, come on down. >> that's my little name tag. guy. that's so when i go out i know who i am. i have a bib, too. >> it is time to play "the price is right." >> yeah. you know, when i was a kid -- >> you watched bob barker. >> i did. i'll tell you how -- i had a ruptured appendix, was in the hospital for ten days, almost bought the farm. i got addicted to two things. "the price is right" and "the young and the restless." but that's another story. >> you want to talk about that? >> but anyway. >> what have you got? abercrombie, let's start out with that. >> see this 'tis -- we're goingo play name that price. we're going to get to the price. let's take a look at abercrombie & fitch, shall we? this is a stock up some 260%

since march. ridunculous. takes the lows in march, the recent hypes, put a little fibonacci in there, looking for a 38.2% correction. what price are we looking for for an entry point, melissa lee? 27 3/4. >> i'm bidding 27.76. >> there you go. nice job by tim seymour. he'll get it ahead of me. by a penny. >> we have one more. >> one more. >> the running out of time here. i don't want to do fibonacci again. that's sort of boring. so we used to have a friend that was on this show, we talked about trend lines. i look at hewlett-packard. you go back for a while. you draw that nice trend line. you know what? the third point of the trend line's going to come back. that's your entry point. what's the price for this? slide it, earl. the price, 43 1/2. now, slide it, earl, from a different show. for you folks out there -- that's "match game." i know that's way off the rails right now. but since we're playing tv, why not? but that, my friends -- >> the "match game." was that when they sat on

different sides of the wall? >> "the match game" was charles nelson reilly, brett summers. it was tremendous. i mean, we had all -- the nipster. >> i remember the nipster. >> sure you do. >> anyway, i hope you had fun playing. >> you know what? that, my friends is "the price is right." >> that's awesome. >> that's my name. >> awesome as your name tag. let's -- >> that's it? we're not doing -- >> no. >> i had fun with that. >> we may resurrect that segment since it was such a boatload of fun here. time now for today's edition of "pops and drops." kick it off with a drop for lowe's. >> $100 million in writeoffs. these guys are going to continue to perform. just a pullback today. probably a great entry point. keep an eye on lowe's. >> you remember what bob barker used to say at the end of every show. it's an homage to mr. backer. it's an homage to mr. barker out there. pop for carnival. up 5%. go! >> let's do a little more guy adami price is right.

yep, couldn't get above $35. third quarter earnings are good. what's the price you want to buy the stock at? where's our little price is right sound? 32.50. why? that's in the gap from today. that's your price gap. >> you don't have a name tag on, so we can't do the little -- sound effect. fyi. there we go. pop for walter energy. it was up 7%, guy. >> we just had roy hobbs on here from london. oh, simon hobbs. sorry. roy hobbs was -- sorry about that. the natural. these cats are speaking tomorrow at a conference in london. we talked about it earlier. i still like walter industries, energy. horse of a different color. wlc still works. >> pete najarian -- >> come on, hobbs -- >> the second one in two weeks. >> second one -- hey, mr. evans. >> hi, mr. evans. >> all right, pop for u.s. steel at 5%. >> upgrade for neutral. bank of america utilization is going higher. dollar's weaker, resources go higher. that was the story today. >> and we got a pop here for a sri lankan man. >> huh? >> a sri lankan man whose name's very difficult to pronounce.

set a new guinness world record by smashing 29 wooden bars on his body in one minute. the martial arts champ already holds the record for smashing -- >> you sure he didn't get caught for jaywalking? >> smashing 44 concrete slabs at once with his head. >> no. >> apparently he's very good at smashing very hard things on his body. >> that doesn't look like -- >> way to go, wasantha. he watches the show. in between bashing stuff he's watching. >> not anymore. >> coming up next after a year that sent many wall street heavyweights packing, does this survivor have what it takes to dominate the new landscape? you're watching "fast money" on cnbc. we're first in business worldwide.

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or just one brita faucet filter. - ( plinks ) - brita. better for the environment and your wallet. the market hit the bottom in marm. they beat all other sectors by 2-1. that's thanks to the banks that emerged from the crisis leaner and meaner. here's jp morgan. >> whether you think it was the deal or the steal of 2008, jp

morgan's purchase of a crumb bling bear sterns for $10 a share was a watershed moment in the crisis. separating the banks destined for distinction and those new kings on wall street. leaving jp morgan, some call him the last man standing. >> before jaime diamond came on board jp morgan had a lot of risk management failures. he focused on trying to improve risk control. when you get into the crisis he had a much easier hand to play with. >> a former disciple of sandy wild, he's now said to have done opposite at jp morgan. building a nimble bank that kept costs low and bureaucracy low and derivatives under control. it was the perfect ship to naif gate the perfect storm, he not only bolstered jp morgan's trading and retail banking arms,

some credit his actions as key to saving the financial system itself. >> his decision to have jp morgan step in with bear sterns step in with wamu, while these. >> reporter: certainly beneficial to jp morgan's shareholders, they definitely helped this country a great deal. i think it was a win-win. >> with the shares up almost 200% from the bottom is there any mojo left? >> with jp morgan, the stock is pretty fully valued in the mid 40s. we think normalized earnings for the company is about $4.65. putting a ten times multiple on that -- >> what's the fast money trade for jp morgan? >> jp morgan, you lost your -- >> thanks. for your southern rock fans out there, i know you're out there american by birth, southern by the greats of god. this was the album cover that came out on october 17th -- they had to pull that one for obvious reasons three days later prudently -- that was a terrible

pun. i think jp morgan. i dig jeffrey's more. and i think -- >> anybody buy jp morgan? >> i own it. i think the other thing about it is the possibility that they may and they did allude to this, may move tho whole dividend stream even higher. >> the thing they got from bear sterns that had the most value was the prime brokerage business and their custodial business. they did very well in addition to other things. very valuable. >> final trade right after this. (announcer) every woman has many sides

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final trade now, sack? >> lots of jockey for shares in this country. >> u & h. >> take a look at ford motor. i think it bo ms to around seven. >> and smith international bought an enormous amount of the november upside. keep an eye on that one it looks awfully interesting. >> i'm melissa lee. thanks for watching. see you tomorrow at 5:00 p.m. for more "fast money." . when this shoe store added aflac

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