it obviously is. we are a little bit concerned that we're borrowing demand going forward with this strong buy. and that could limit the gains tomorrow and possibly to a small pullback next week. >> gentlemen, thank you for your thoughts tomorrow. both are bullish, at least for the second day of the -- >> i don't know if that's a good reas sign or reason to be worried. >> it with us a stellar day. heavy volume, heavy upside, the dow up 308 points on the day. >> better than 3% on the nasdaq. it was a real pleasure to be with you. >> it was a great pleasure. see you the rest of the week. >> sounds good.that does it for. thank you for tuning in. >> "fast money" starts right now. we will see you tomorrow. stay tuned. ♪ live from the nasdaq market site in new york city's times square, i'm melissa lee. downgrade threat.

congress made a deal but are we risking another debt downgrade? retail returns. americans are sending back millions. we are talking to a ceo of a company that is turning returns into big business. and the best stocks to get short on. but first, to our stop story, and that is the big rally on the cliff deal. on the last day of 2012, monday, our traders told you what they expected from the market. take a listen. >> i think you can actually buy it on the open in the morning because people will be getting back into it but i would not -- it would be a rental position. wouldn't be long-term. >> there's a lot of traders that held out today, hope you would see the market sell off. to get another opportunity, so, they held off. they'll be a buyer on wednesday. >> my sense is the news over the next couple of weeks or such will be probably on the margins, positive for the market. i wouldn't be surprised to see us push forwards 1500. i think the trade of the year will be getting short this market early. >> okay, so, today, we ask, were

you a buyer or a seller of today's rally? how did that rental position work out? >> it's gone. we had a tremendous rally today. if you had any profit, you have to take it. although, at the end of the day, we saw an acceleration. what you have to worry about, to guy's point, if you do get people getting back into the market, they've missed the 3% rally already, you have a little bit of performance chase, but i'd be very careful. >> do you feel the same way that yous felt just a couple of days ago, given that's happened, that the debt ceiling debate is put off, that the difficult issues, which could be much more vitriolic than the tax debate, could be put off. do you feel that the headlines will be on the -- >> we will create headlines that will give people reason to sell. but i think the market headlines are going to continue to be positive. and, you know, timmy made a great point the other day, because i was very vague in my

opinion about where i thought the market would go. let me give you a longer term chart. i say between 1500 and 1560 and timmy said, you could drive a truck through that. i'm going to undrive the truck and narrow it down. i think the s&p is headed towards the march 2000 low, the march 2000 high, which was 1527.35. the all-time high we saw in 2007, which was 1565.26. we're going to settle in somewhere there. i think that will be the top for the year. i think that will be the selling opportunity, maybe of the last couple of years, and i think that will happen over the next month, month and a half. and the way things are trading now, i wouldn't be surprised if it were sooner than that. >> buyer for the next few weeks and the seller on those levels. >> right now, i don't think you can get in the way. nothing happened today to lead me to believe it's not going to happen. >> that kind of accountability is what we do here on "fast money," thank you, guy. >> that's right. >> to me, when i look at the emerging markets index, which is what i do all day long, an rsi that we haven't seen since 2006.

this is a sell signal. we have in the last six years seen emerging markets this overbought. so, this is similar to what guy is saying. i would be taking profits in the short run. i don't think you can sustain this kind of momentum. even though, when i look at things like, in germany, the two-year note, had an auction today with a positive yield for the first time sincele octobe o. the one thing you hear everybody saying, especially today on the first day of the new year is, i'm going to go on a diet, guy, brian, i'm just going to be a better all-around guy and otherwise, you hear people saying, our u.s. treasury has a bubble that cannot be sustained. and that's one of the things that you're going to see. yields are going higher because not only can these levels be sustained, but there is rotation. that's why this market has more legs but it's overbought. >> all right. >> we all thought the market was going higher today. we all said that. but that still didn't stop us from taking profits.

i sold etna, i sold ford. i also sold google. that one left a mark. so, there were places where you knew you were giving up upside, but you still had to do it just to cut out and make some profits. >> you brought up ford and i think that's actually the key to this market. if you want to make a bearish case on the market, you have to talk about the consumer being tapped out. we have consumer credit at al all-time highs. the bulk of that comes from nonresolving credit, which is cars and student loans. gm and ford were both underperformers today. gm only up .6%. if you see some faltering in car sales, that's going to be your key to the top of the market and maybe it comes where guy thought it was. >> the s&p says the fiscal cliff won't affect where the country goes, but lawmakers have yet to tackle a bigger challenge, and that is, of course, the debt ceiling. let's bring in chris krueger.

great to have you with us. >> hey, guys, happy new year. >> you've actually increased the probability of a u.s. debt downgrade to 20% from 10% what were the major facets behind that? >> well, we think the optimism around the fiscal cliff deal is just sort of a mystery here. we've hit the debt ceiling. we've triggered extraordinary measures to prevent us from a default. the only thing that was really done in the first fiscal cliff deal was the bush tax cut us, which really basically were the kind of the easiest component of all of this. they haven't taken any of the tough deficit reduction measures. the lawmakers, the lead negotiators really do not like each other. that's only going to increase and you see now folks already starting kind of fiscal cliff 2.0 with the debt ceiling, the environment's only going to get more toxic. >> two we sif things you brough brinkmanship and that was there. we all saw that, go down to the

wire. but in terms of the increased leverage from republicans, walk us through that, as to how you get to that point. >> sure. well, really, so, the question is, was the republicans supporting the biden-mcconnell deal a retreat? they sort of took the threat of middle class tax hikes off the table and they've taken a new hostage around the debt ceiling where they can really demand the spending cuts and entitlement reforms that they didn't get the first time around. not only is the debt ceiling a hostage, you also have the sequester trigger coming up again. and you also have a potential government shutdown on march 27th. so, it's sort of a trifecta of hostages that the republicans have. they feel they're in a better negotiating position because they can't be labeled as sort of the protectors of millionaires anymore now that the revenue side is taken off the table. >> i'm caught in the middle here because i feel s&p is losing

credibility once again. they said if it was a patch work job, they definitely downgrade another notch. so, do you feel as if the debt ceiling is going to be pulled into this, so that they're looking for a way out not to downgrade? >> you know, that certainly could be an issue. you know, i think more than anything, what folks really in the markets as well as everybody are looking for is some type of sustainable path to get the deficit and entitlement programs under control. a lot of people want to talk simpson/bowles. biden/mcconnell, if you take that, the cbo score increasing the deficit by $4 trillion over ten years. we're not talking deficit reduction, we're talking the opposite. and until d.c. feels pressure to get the deficit under control, we may still be in these situations. >> and last question, chris, and that is, 20% still isn't a very

high probability, i mean, not over 50%, and at the end of the day, will it actually matter if we get another downgrade? we got one before and here we are. >> well, i mean, i think downgrades don't matter until they do. 20% maybe isn't, you know, above 50%, but 20% of a technical default on the debt of the united states, i mean, you know, that's -- kind of a big deal. so, you know, i think that, you know, it's almost unthinkable, you know, that the, you know, that the u.s. would default, but it's deaf ffinitely now, you hao say it's in the cards, we increase the probability from 10% to 20%, particularly when you take into account that congress took us off the fiscal cliff and they didn't get it passed until about 24 hours when we were off the cliff. if you go off the second fiscal cliff here, the debt ceiling, you're in very unchartered waters. >> all right, chris, great to speak with you. chris krueger of guggenheim. we saw the reaction.

this is the chart. this is what the crack staff came up with. the s&p 500, one month prior to the downgrade, down 11%. down 2% after. where you can feel the impact was in the bond markets. it's opposite of what you might think. one month after, 1.979%. >> people forget, at the same time, europe was falling apart. we went into this downgrade, july 31st was the edge for the markets and then you had on the 5th, we raised this this morning on the call, when the u.s. was drawn into the fray. but global markets were in dire straits at this point. u.s. treasuries were still a safe haven. if you look at where we went, yeah, the market was up 2% a month later but that period until the middle of october, forget what august was like, up 5%, down 5%, up 5%, on the s&p, let alone markets. markets broke down and i do think, as was pointed out by our guest, this is a big deal. i don't think the u.s. can just digest a downgrade. it doesn't mean people run for

cover. there's not a lot of other places to go. but it's a big deal. >> the key here is, if we can still be a safe haven. >> and there are other places in the world that are probably a little bit more dangerous than the u.s. namely japan. i would much rather own a u.s. treasury. they didn't flinch. the cds for the u.s. were down today. it's probably going to take, in my opinion, a multinotch downgrade to really get rates rising here. coming up next, we're kicking off the new year with a street fight. headed into the ring to duke it out. stick around to find out who will repail. and ever wondered what happened to the hoards of christmas presents americans just don't want? we'll give you the ceo who is capitalizing on all of your holiday returns. stay tuned. [ male announcer ] at scottrade,

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the fed has created an environment where there is nothing in the world but financial assets that's competitive to equities. my line is on bonds. i think buying u.s. government bonds is like walking in front of a steam roller to pick up a dime. >> that was omega advisers chairman leon cooperman discussing why he's optimistic on stocks and why bonds are, in fact, in a bubble. tim referred to this earlier in terms of everybody makes that resolution, that prediction every year. and it hasn't come true yet. >> and tim also told me apparently i have a lot to work to do. >> all around good guy. >> that was awful. >> coming into the show, i have a lot of work to do. >> that was wrong. sorry. >> bonds are certainly in a 30-year bull market. you might think they're in a bubble. here's the thing about bubbles. they can last a long time. as long as you have the u.s. federal reserve as the buyer of last resort there and china, no doubt, is also a buyer and

they've announced that they'll probably continue to keep buying, it's really hard to have this bond bubble pop and you do not want this bond bubble to pop. if it falls apart, it's government deleveraging. >> let's move to hewlett-packard. the company will consider selling its businesses that are not meeting goals. today's performance, a big improvement from 2012 when the stock saw a 47% decline. trash to treasure this year, you say? >> i think -- and we talked about this, i thought we did a nice job flagging this back in november. i think it was november. i don't know exact date when they kitchen sinked the whole thing. we talked about that being the bottom. and it was and we've seen the move since. and it looked like today we were going to have an outside day in terms of volume. but the volume petered out at the end, which leads me to believe that you can see more move to the upside here. so, it closed around 15 bucks, i mean, it wouldn't surprise me to

see it push to 16. i'm not saying the company is fixed. i think the stock is for the short-term. >> the autonomy bottom is what you have to focus in on. people want to focus in on pcs. you have to start looking at where the growth is going to come from. enterprise, cloud. those are the growth areas. 3d printing, hopefully. so, as guy said, the stock has a lot more room. >> all right, hue let was a big gainer, but so was u.s. steel. one of the biggest gainers. shares are up 7% after the boost of the stock's rating saying higher steel prices will push sharing higher in 2013. but not everyone agrees. and our traders are ready to rumble in today's street fight. tim takes the bullish case, grasso, you are the bear. >> my prediction is pain! >> grasso, kick it off. >> rolling up the sleeves, you see that? >> exactly. you look great. >> do this. >> people -- let me get my sister in to fight you. just kidding. >> whatever, dude. you said that, not me. >> when i look at steel, i look

at the seasonality of steel. in november, december, those are the times to buy steel. on average, let's call it 11% november, 14.5%, if you look at the last ten years. january and february, terrible months to be buying steel. i'm just looking at seasonality right here. >> all right, tim? >> you know, in terms of the fundamental dynamics for u.s. steel, there's a couple things you have to know. 30% of their business is levered to the auto sector. we're going to get an annual print on u.s. consumer production tomorrow, around 16 million bucks, 16 million vehicles,s k excuse me. and i think the demand is there for steel. i look at iron ore prices above 140 and you have actually a restocking going on. it's going on in ore and coke and coal. there are ultra shorts out there in cyclicals and industriaindus. this broke through heavy resistant two bucks above. up to $28, this stock is very interesting. it's not expensive on 2014.

i'm talking about eight times earnings this year. look at what china did over the weekend with their pmi. u.s. steel is going to rock it and that is a stock that a lot of people are short. >> i will say this. if you are going to own anything in the space, u.s. steel is the one you want to own. they do have their own iron ore and the only ones that do have that. you have to wait until march to start seeing a pop in the stock price. because technically in seas seasonality, the next couple of months could be challenging. >> what is behind that? >> well, it starts in november, there's a part of that, but it starts in november, because goldman sachs has the steel conference and they have ceos pounding the table, saying, last year wasn't as bad and next year's going to be better. >> but the thing is, if china comes become from the new year's holiday break and announces a stimulus plan, then we could see all the materials -- >> and hu jintao said a bunch of things, that they are going to push for growth. you just have a backdrop where -- look at the european autos, and again, look at the u.s. auto numbers.

i think it's a great time to be in the space and not just u.s. steel. i think it's other guys we've talked about. >> it was an overshorted area. we get this pop and you get this oversold. >> who won? >> that's where -- we're getting to that. >> china was -- >> he keeps talking. >> i'm sorry, we'll stop. it was based on people selling overselling steel, overselling based on china. i just don't think you're going to see that upside million march. >> b.k., make the call. >> ah -- you know what? if you -- yeah, there you go. ah -- i'm not a buyer of u.s. steel. if rhyme going to buy metals, i would rather be in the base medme metals. i do not think the world economy is that strong. >> time not for pops and drops that you might have missed today. a drop for consol, down 3%. >> gnnat gas is levered to thei coal production. that's why you saw aci, btu and consol, stay away from the name. >> drop, macy's, down 2%.

beeks? >> this is where you really saw the consumer being tapped out, themes starting to play, down 2% today. i think probably in the retail space, it's tough to play now. but this is not a buy down 2%. i would stay away from these names completely. >> pop for cummins. >> that's a big move in cmi. i think it trades up to the may highs. if you are long it, i would hold it until then and then get out of the entire position. >> this is a pop that feels like a drop. the move is only 1%. bph up 1%. >> after the move it's had, this is an 80 rsi. of the names that we saw are overbought, i think this is one of them, though this is best of. if you like this trade, this is the one you buy. you don't need to buy it tomorrow and a 1% pop items you this was overbought. >> a pop here for jcpenney, up 5%. mike? >> b.k. hit on it already with retail sales looking weak and the consumer sector. this one was up. patiently because the stock was hammered so much last year. we saw speculative bullish bets being made, but i think spe

speculative is the only way to describe it here because people think johnson's strategy might be getting turned around. >> a pop here for the ostrich pillow. a madrid based pillow called banana studio has a new tuesdsng tool. it's a microenvironment, that is perfect for a power nap. it comes complete with holes -- for your mouth, head and hands. >> that is out of hand. >> be able to sleep like a log or like an ostrich. >> that's like a sci-fi movie. >> that is unbelievable. >> if you pay me enough money, i'll wear it on the show tomorrow. i will wear it on the show all show. >> really? >> all show? >> a lot of people typically think you are in that during the show. >> that's a good lynn by you. >> we should call it the banana studio and see what else they've got, too. all right, coming up next, three names that could be your best bet for the new year.

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♪ welcome back to "fast money." happy new year. we are live at the nasdaq market site. what a way to start the new year. big rally today and that story could be seen in the vices. the biggest two day drop in a few months here, after the biggest gain of the vix on friday, since november of 2011. mike, what do you make of the action here? >> well, one of the things we would expect, obviously, when you have a market rally this strong is to sigh the vix to climb. you probably expect to see it climbing by .9. part of that is obviously related to just the rally in the markets. but the other part is clearly related to getting over one hurdle. as you look out in the curve, out to the march vix futures, you see there is a little bit of concern. those came in only about 1.5, so, obviously, the next hurdle that we have to overcome is still a concern. >> and i would just, to take mr.

cooperman's quote, i mean, this is a classic case, people are selling vol here. this is picking up nickels ahead of a steam roller. a day like today can skew the fact that people are not in the market and need protection. >> you are much better off buying a call spread on the vix. it's pretty cheap to do now. >> sometimes it's tough to buy the losers and sell the winners. let's play a little hold 'em or fold 'em. first up, we've got the financials coming off a big 2012, of course, gold mman sach trading today at levels not seen since august 2011. grasso? >> we flag the stock at $119. had to cross over that $127 mark. it did just that. now it's got to hold $129.72 to be precise. it has to hold that on a closing basis. you want to treat this as a confirmation. it's got to hold it for two or three days. look for the middle of next week before you establish a position. if it does hold that level, the door is open to $137. >> oracle, popping today hitting

levels not seen since may of 2011. what do you do, guy? >> i'm going to play the game properly, i'm going to say hold them. >> which grasso did not do. >> can't play that way. >> i apologize. >> hold 'em, but we've been holding this sucker for awhile. oracle's been a monster. we say it's the best m and a company out there. they continue to integrate better than anybody. here's where you are going to run into a bit of a problem. we need to get through $35 for the next leg up. my sense is, we're going to push towards that, probably print there and then fail. but i still like the name up until $35.50. hold 'em for me. >> strong. >> well done. well played. >> you think? >> sorry. >> stocks -- >> deal. >> rallying more than 300 pointsover the fiscal cliff deal but can the optimism hold into 2013? let's bring in brad lammens dorf. brad, great to have you with us.

what is your top share for 2013 at this point? >> century link. new position for us. this is the old land lines and internet service. the interesting thing and the way that we found this economy, we were screening cash flow. and the dividend on this company takes 90% of their entire cash flow to pay this dividend. and we started doing a lot more work on it. we found a lot of poor cash flow items, as well, involved with the cash flow number that they're feeding to us right now. we think that cash flow number is pretty questionable. >> so, on the cash flow, we have an environment that corporations can borrow at essentially nothing, why couldn't they do a convertible bond and pay out that dividend? >> they could. but they are actually stretching the limits. they actually needed to do some cap ex just recently and they couldn't come up with a debt type offering that you are talking about, because they are so stretched anned they did a

capital lease and that's, again, pulling more liabilities going out. they played with some depreciation, where quest had some depreciation that was, say, six or seven years left, they took it out to 10 or 15. playing a lot of games and we really feel like this is the type of name, where, again, if there's a weakness in the economy, this thing really gets whacked, 25%, 40%. >> brad, you know, in terms of how your strategy is set up, how many of your shorts would you say are true structural shorts? what we're talking about is a company that you think is unsustainable, as opposed to trading shorts. a lot of times, markets get very frothy. i would think you'd be liking your chops. how much of your stuff is tactical? >> that's a great question. everything that we have in the book, we have fundamentally vended out. we do probably have 150 names that we may not like for one reason or another. there are so many 80 rsis, when i left the office, and my entire

portfolio, it's almost comical and i was listening to guy talk before i came on and i'm probably -- >> smart man. >> you're in a liquidity period right now. you've had some good news. we just feel like our specific companies that we choose for a constant contact or a caesars or whatever it may have been, they have specific issues with them. >> your overall fund, the performance has been less than stellar, one year it's down 28%, it's been a big market year overall. it is difficult to be a bear in this market? is that going to change in 2013? >> i think that -- and i've said this several different times. when you look at our performance when we're down, we're really gaining a lot of alpha. we're definitely losing alpha when, as the markets grinding up. we hope that our stock picking helps us some what. on powerful days like today, we

came away flat relative to the market on an inverse base. we felt like that was a decent day for what we do. it is a tough period in time. we -- when i came on the show in september, we were very bearish, correctly so, on november 19th, we went to 84% invested, so, 16% cash. which is pretty defensive. we've moved it back into the markets now and we're back up to our full position. so, i feel like our market timing has been pretty good. our stock picking, you know, it's definitely frustrating when a company misses and we don't get paid. >> you have to short stocks and tiffany is another one you're staying with in 2013. >> we are. and tiffany's, it's coming towards the end, a lot of the margin problems are starting to, you know, get vetted out. probably another quarter or two in this thing will have played -- this could be the low quart it coming up this quarter, this january period. >> can i ask you one just management question in terms of a portfolio management? so, tiffany short interest, 7%,

give or take, is there a short interest percentage that would scare you away from being short the stock? in other words, north of 15% or north of 25%, in other words, when everybody is short the stock, do you say, you know what, might make sense but we're staying away? >> about 15%, really, is where that comes into play. obviously, if it's 15% on an $8 billion company, that's a different number than a 15% on a $1.5 billion company. so, we take all that into consideration for sure. >> all right. brad, good to see you. >> thanks for inviting me. >>. coming up, you may not want all your christmas gifts, but there is one company that's turning your holiday returns into big profits. the boss at liquidity services is here with the inside scoop on this booming business. stick around. [ male announcer ] how do you trade? with scottrader streaming quotes, any way you want. fully customize it for your trading process --

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welcome back to "fast money." mastercard and vie is a charging out of the gate on this first day of the trading year at fresh all-time highs and they're seen going higher on the street. mastercard topping $500 for the first time since going public, sees its price target lifted from $505 to $575, while the

target on visa is raised from $155 to $175. visa outperformed its rival in 2012, but mastercard shares almost cut up in the fourth quarter. mef list is a, i know i've been burning up the credit cards. i have to admit. >> you have been in naughty. thanks, bertha. interesting to see those record highs in those stocks, considering what retail has done, guy. >> well, one would think it's interesting. >> one would think, yes. >> except if you're a fan of "fast money," and we're coming up on our six-year anniversary. >> happy birthday to us. >> and for a long -- i mean, mastercard has been one of the names we talked about forever and visa ipoed during the inception of this show. the only way to play the retail sector is mastercard and visa. today is a perfect example why. look at the performance of those stocks and the updz performance of a lot of the retail names. even with the moves today -- >> right. >> even with -- >> even with -- >> still think mastercard and

visa are going high. that's not -- that's very unlike guy. >> it is. >> you could buy with credit cards other than just going american eagle. there's a lot of things you can buy with it. do you know how many transactions, what the percentage of global transactions are paid by cash and checks still? >> 33%. >> 85%! >> no. >> i was shocked by it, too. >> global. >> i spoke to a mastercard representative today and it's 85% of global transactions are still cash or check. that's -- >> are you still paying for threat much everything with your gas card? sunoco card? >> only when a rent a gasgatsby. >> i don't know what that is. >> sweet comeback right there. >> hitting record levels with year-end cliff worries weighing on consumers. retailers were expected $63 billion in holiday gift returns and trading has reflected as much. the s&p 500 retail index fell 3% in the month of december. so, what are retailers doing with the excess inventory and

who is benefiting from it? joining us is bill angrick. bill, great to speak with you. >> happy new year. thanks for having us. >> happy new year to you, too. people might not know what you do, but you deal with all of these returns. tell us what you do with these returns and how you make money off of them. >> sure. well, we're the world's largest e-commerce marketplace for surplus goods. we work with over 75 fortune 500 retailers. this time of year, they're dealing with over $63 billion of goods that are flowing through about eight distribution center hubs we manage. we investigate these items, inspect them and put them up online and auction them in bulk on liquidation.com. and i would sail this is a great time to be a consumer, but it's a challenging time to be a retailer. we were poised to have a breakthrough retail season. people have been pearing down consumer debt for the last four, five years, october, we had hurricane sandy that really

challenged the east coast. we had warm weather in november, december, which affected a lot of the heavy apparel sales. and this wall of worry that built during the fiscal cliff negotiation, really damned consumer enthusiasm. a lot of volume in our business today. >> do you actually pay for that excess inventory whether it be a retail return or extra machinery from a factory? do you take that on your books and then sell it so you're on the hook until it's sold? >> the majority of our business is on a consignment basis, where we do not take title to the goods but retail a share of the revenue, realized from the sale of these items and what drives our marketplace is, our buyer base. we're reaching over 2.2 million buyers in 200 countries that have demand for these returned items. one company's returned item is another small business's treasure. and we connect that supply and demand in the most effective way using our internet model. >> hi, it's brian kelly.

it sounds like you are economically sensitive but almost inversely, as consumer return more, you guys do better. is that the case or just an anomaly over the last 30 days? >> no, i think this is a secular growth in volume of our marketplace. you know, as the shift of retail moves online, return rates grow significantly. return rates online are about twice as high as traditional brick and mortar sales. moreover, retail is fiercely competitive. and retailers must provide convenient returns experience to the consumer to retail their loyalty. so, those factors drive the supply in our marketplace. we are counter cyclical because our buyers are frugal. they are looking for good values that we bring through matching the supply efficiently with this global buyer demand. >> all right, and last question, bill, and that is on december 12th, you had an analyst day and analysts by saying gross merchandise levels had to hit a

certain one. do we see a pickup in returns? >> we've seen, in our business, a brisk volume in our auction count, which has been up 20% year over year. we're seeing increasing inte from large retailers to be more efficient. they are fighting for every penny on that bottom line. they need to use smart solutions. and we've grown. we have 1,300 employees in over 25 countries to help these global manufacturers who supply the retailers in the u.s. be more efficient in this market. >> bill, we're going to leave it there. thank you for your time. >> our pleasure. >> bill angrick of liquidity service. beeks, you were intrigued, it seemed? >> i was intrigued because it seems as though -- i was trying to get more read on the consumer and what happened over the last 30 days and if you could look at this company sales as an indication of a weak or strong consumer. sounds like there's a structural change here going on. i know before the show, grasso

told mel that he bought a six-pack of meggings -- >> what size? >> i have no idea. >> extra small. >> i don't know. >> either way, it doesn't fit. >> going to go to break at that point. coming up, the holidays may be over, but we hear at frm flm are still bringing the cheer. up next, we'll raise a glass to the new year and the top spirits both in investing and buying. we'll be back. she keeps you guessing.

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let's head back to head quarters, check in with bertha who has a look at defense stocks. >> defense stocks have been the barometer on how people feel about the situation with the fiscal cliff. with the cliff averted at least for now, a two of had month extension when they'll renegotiate, but those automatic spending cuts not going in, defense stocks close. flir systems a winner today. a hold to a buy. but look at some of the others, itt, general dynamics, they are, of course, the folks that make electric submarines. back to you. >> thank you, bertha. 52-week high in today's session.

>> ex-post facto. >> keep it going, bro. >> trifecta here. >> i tell you, these defense stocks are going to outperform once this cliff deal gets settled -- >> what happens in two months? when we actually get -- >> shakespeare wrote of soothe say earls, i am not one -- >> you are such a show-off tonight. >> anthony, my buddy, anthony, also discussed this, as well. i like defense names. yeah, sure. >> okay. with stocks holding onto today's sharp gains, wall street is surely cheering the fiscal cliff deal. here to raise a glass to the progress on capitol hill and the new year, owner of the brandy library in new york. great to have you with us. >> thank you for having me. >> what are going to be the big liquor trends in 2013? >> well, i think we'll continue on seeing the big trends of 2012, which is really a lot of

irish whiskey showing on the market. a very strong bourbon. super premium bourbons, kentucky, straight bourbons, mostly. and, of course, single malt scotch will go very strong. >> so, you brought some bottles here. why did you select these -- >> well, if we have to raise a toast -- >> and we shall. >> and we shall. this is something quite big that just happened, so, of course bourbon, with this 20-year-old, not just because it's 20 years old and that's already pretty rare in the bourbon industry, but because it's already gone. this is where the bourbon industry is going now. it's so premium that the moment you see it, you've got to buy it. and then it's gone. and it was expensive. in a few years, we'll see a 21-year-old and a 22-year-old. the bourbon market is doing so well because, well, there's a good production. lots of sales. >> i actually own a begin mill downtown --

>> shameless. >> one of the things that i've noticed is that the young kids are drinking a lot more whiskey but the things you are holding there are price points, there's a lot of sensitivity to what people will pay. despite the fact that in emerging markets where i'm investing, aspirational spirit buying is what's going on. people want to trade up because it's a sign of prestige. give us some color on that. >> this is where whiskey is extremely strong in the u.s. the very base of whiskey, the very simple $15, $20 bottle, is going very well. given a lot of that goes to tax, but that helps, that's also why we're here today. it's just more women, more young, more people aware of this category of american whiskey. so, everything goes well. from the low end to the very super premium. that's the premiumization of the market. so, i think we have a lot to cheer if that's going to go on. >> in terms of consumer willingness to pay a premium price for these bottles of liquor, how is that reflective

of what's going on in the economy if at all? >> it's a great sign of health. i think the economy -- >> what are you seeing right now? are people flocking to the brandy library sipping this stuff if. >> definitely. we tell you, oh, sorry, no more, or hurry. it's very important to see that those are small quantity, so, they are collectibles and there's a great market of auctions of brown spirits that's quite healthy. not just over there in the uk, but here in new york and boston and in asia. now, we'll be lucky if southeast ease ya is not taking it all, so, if we like it, we want to bank on future, that's it. buy it now. >> thank you for coming by. >> you're very welcome. >> of the brandy library. >> i love the brandy library. one of the nicest establishments in new york. >> you have to go to some of the liquor -- >> to me, a great play, because of the growth. they actually just ended negotiations to guy cuervo.

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♪ >> nice. >> welcome back to "fast money." shares of hole builder pulte hitting new highs. unusual options activity, mike. >> yeah, a lot of activity in the april 18 puts, over 10,000 of these things traded if a little more than $1.50. the buyers would hope that the stock might be below 16 1/2 by april expiration, which is just over 100 days away. but the seller, it's interesting, doesn't really see the stock going sharply higher. over the last 100 days, this stock rose about 70%. but you're only collecting about 12% premium there. if you are selling those things, so, it's kind of hard to see why you would sell those if you thought the stock was going to rip. two market participants not seeing a whole lot more upside between know and april expiration. >> let's hit twitter now.

seema mody has what is trending and the big question is, what is a trade for 2013? >> now that we have this fiscal cliff deal, what's the best trade? so, we posed that question to our audience on twitter. here are a up canal of responses. starting with michelle, he said, i would pay the fiscal cliff by purchasing cerner, an it health care stock. it will benefit from obama care. >> i'm with michelle. again, for your "fast money" fans out there, we've talked about cerner for forever. people have shot against it on valuation, but they've shot against it for the last $30. 80 bucks here, i think it goes higher. good call, michelle. nice eye. >> let's stick with health care. matt tweeting, if the current fiscal cliff status puts a boston in the ten-year, then i like life insurers such as met life. we saw a comeback in some of these names. can it build? >> i think it can. met life, all the insurers were up a lot today. if you look at met life, technically it's right up against the down trend line.

b.k. technically doesn't like to buy -- >> brian kelly will buy it b, but -- >> if that goes through, it could really test those old 52-week highs. >> something to watch. now, chin is looking at a different asset class, betweening, with the government needing to print more money to cover debt that taxes won't touch, he's buying gold. tim, monetary easing could help? >> it will and i think central banks continue to buy and the inflation trade is really why you want to buy gold but i think it's in the second half of the year. if there is major rotation, i think gold will not be the risk asset of choice but i do think gold continues to go up, we're in our 13th year of an up moving gold. not going to be a screamer. >> 12th consecutive annual gain. >> what percentage of your portfolio is gold or would you want it to be? >> it varies. i tend to do it by volatility, so, gold -- probably 5% to 10%, between gold and silver. >> right. gold or gold miners. >> no, gold. gold, gold. but you have to pick between the

two. silver. i know you didn't mention that. silver. >> your trade for 2013. i got it. see ma, thank you. coming up next on "mad money," cramer has what he thinks could be the best stock for 2012 and which international markets are traveling higher this year? all coming up, top of the hour. meanwhile, we have your first move tomorrow coming up next. [ indistinct shouting ] ♪ [ indistinct shouting ] [ male announcer ] time and sales data. split-second stats. [ indistinct shouting ] ♪ it's so close to the options floor... [ indistinct shouting, bell dinging ] ...you'll bust your brain box. ♪ all on thinkorswim from td ameritrade. ♪