thank you for joining us. stephanie link, michael, that does it for us on "closing bell" today. "fast money" begins right now. "fast money" starts right now live from the nasdaq market overlooking new york city's times square. our traders on the desk, tonight on fast bank of america says oil could face a black swan event and there is not much that can prevent it from happening. we got the man behind the call that will be here plus as the temperature heats up, an unlikely group of stocks is catching fire. we'll tell you what they are and if any are worth a buy and president obama officially endorsing secretary clinton today. what that could mean for biotech but first, two disturbing headlines that emerged today. george soros sounding the alarm and loading up on gold. second one, one of germany's largest banks saying it is considering get this pulling money and stashing it into a vault. this is happening as stocks

hoover. when billionaires buy gold and banks horde cash, should you run for the exits? >> i think we know where i'm come down on this. [ laughter ] >> yes, the answer is yes. >> no, no. >> but i think there is a really good point. one soros buying gold, he's been doing that but commerce bank hoarding cash to me is probably the biggest thing. it shows why it's not going to work because they are doing the exact opposite thing they are supposed to be doing and spending that money. they are hoarding cash and when less cash is out there to buy things, there is less dollars or euros chasing after things then those things, the prices go down and if you look at the federal reserve monetary base, which is the dollars in the system the federal reserve controls, that has been a very tight correlation with the s&p 500

since 2009. this is what got me bearish. that flat lined. monetary base, which is the dollars out there flat lined. no longer going into stocks. >> you put that well because they are pulling back because it cost them money to store money at the ecb. they don't want to lend it. the demand is low. they are considering putting in a vault. >> and i get that and it's hard to argue, first of all, soros stepping back in to be more active in trading his own book is something that really hasn't happened since 2007 when he was rightly very bearish. that's not him calling right now. sorry. but ultimately, it's a case where that makes sense to me and we heard very powerful important investors make claims there are things that bother them and things that bother me but comparing that and commerce bank is not a specklator. commerce bank is saying i'm going to save this bank money by parking anytime a vault. this is someone doing something

that's their job to look for ways to save the bank money and okay, i get that the big question is but to me this is not a systemic risk. you take it two or three levels and say the system is ripping apart at the seams but this does not worry me as headline. >> is it systemic with the fact the banks are within 10% of the 52-week lows. when you thick of banks, they are supported to lend it out and something they see there that just spooks the heck out of them and my biggest problem to the u.s. is look what happened to yields in the last week. our treasury yields and european banks there is 10 trillion negative dead out there in the world but i look at european equities and japanese equities have done the exact opposite thing of the intent of all of this. so i get worried here when i start looking at very economic licensetive sectors like autos, home builders, airlines, like

retailers and all act like that. >> however, and i'm not pretending i'm a raging bull because i'm not and been wrong for awhile. i thought this would stop 100 s&p points ago but here we are with less than 1% of all-time high in the s&p. the question that's begged to be asked that i can't answer is if everything we just talked about today and over the last few months doesn't stop it, what is? so to me it comes down to what tim has been saying. it's a scare thing. people are parking it in the spring break. >> you know it and sure enough the deck collapses. just aren't going to be an investments.

they should be trading maybe a fraction of the book value. >> that's a reality. and the world and european banks have much better balance sheets than they had before the crisis. a world where they are refinancing did nothing and ebc and it's a bridge stocks may be very valuable. >> when i look at deutsche bank in the world so we also saw copper today down 1%. >> this is the chart of the day and this is an interesting one. >> right. and here is why copper is important because copper breaking below $2, right? that means and one point today if glen core gets downgraded,

european banks are on the hook and credit. they can't pay their bills. we'll have no money left. might be back stocked at $2. >> copper at $2 three months ago, four months ago. copper is 15% off its highs and granted not rallied dr. copper is supposed to be a sign of the economy not going well. so you can blowholes in whether copper should be trading below two but the reality, this is priced in there. these guys continue to improve the balance sheet selling off assets and not dumping money. >> they have been downgraded. >> right, glen -- european banks on the hook. it's $100 billion of unsecured debt. they are fine. they might get downgraded. what i would say about copper, it wasn't even a month ago china announced that with steel.

steel prices down 50%. >> steel capacity being taken slowly. not fast enough. you're at a place where look at the crb and i realize copper is an important part but you talk about the ad space, look what is going on with prices and hot rolled steel and a lot of things that firmed up dramatically. >> last time i checked -- >> commodities, what do you want? >> i'm actually long iron or steel and mostly long copper and oil and i think these are places where you actually have supply issues. i think you do have a deficit in copper and balance out in a month and a half. we're hearing from people and big industrial metals. >> how about you, mr. bearish? >> listen, i think oil is a big head fake here and gotten back up to 50 and up 95% from those 52-week lows but it's important to remember it was cut in half from a year ago level from 2015. when i look at oil, it's a

function of the dollar and that is a function of the u.s. federal reserve inability to normalize interest rates and that tells me there is stuff going on here. i wouldn't be buying oil for the breakout and a lot of people got excited with the xle at 70. >> moved 100%. we get excited tomorrow, either. i think oil is probably capped. look at hedging and where guys sold off so they probably can't be as operationally aligned. canada coming back online and nigeria is better. you don't go and run oil now but to say the 100% move off the bottom is garbage is saying oil doesn't belong at 50. >> what i'm saying to you, the s&p is only where it is because it obviously energy names, material names over shot to the downside and have this massive boomera boomerang. the nasdaq which is some of the largest companies, the nasdaq, the top five holdings are some of the largest companies in the world. apple, microsoft, google, make

up 40% of the index. that's down and well off the all-time high. >> you don't believe the rally -- >> leadership that got us back to 2100 in the s&p 500. >> mr. deck is going to buckle. what are you going to do. >> i've been saying doesn't want to go down. with or without him. 1.65% in the u.s. ten-year and whatever that means in german ten years. i think rates go significantly lower. >> a bizarre trend has been gripping the markets right now. something has got to give, right? bonds, gold, stocks, they are all rallying sign tmultaneously. julian emanuel is u.s. director. julian, always good to see you. so what does give?

>> so, well, we do think gold goes higher. it continues to work higher. clearly, there is a lot of investor support. to us, it is actually going to give because if you go back what we've seen over the last four or five days is clearly in reaction to february -- until friday's disappointing jobs report. no doubt about that but when you step backtracking 2% and earnings like they are going to grow. so our view is when you get to value, into the summer those numbers are going to normalize and bond yields aren't necessarily going to go down anymore. >> so there would be a spike. >> looking for two fed rate hikes. nothing dramatic. the fact is when yields are this

low on, sends a signal to investors, who, by the way, and look at the dialogue among yourselves. there is a lot of fields in the markets. >> send stocks higher, what does it do to the last leg. >> actually, it will. prior, the confirmation that the economy and that's why the fed is hesitant because it wants to see more data. >> sorry to cut you off. typical rate cycle trying to get back off the bottom. even i have to admit that. >> there is absolutely nothing typical about it and part of the fe fe fe fe feds calculation and the message we have here and the fed needs to keep psychology moving in a

forward direction but we think the economy is going to do it. >> let me ask you this, everybody we talked to or i talked to says why are we buying stocks because yields are low. i can get 4 or 5% or 3% in the u hi utility. shouldn't stocks go down. to me the black swan for the market is rising yield when is you're asking about or talking about. >> you don't think that's going to happen. >> not initially. i don't think that's going to happen now. >> we differentiate it's not all stocks. if yields go higher, the defensive stocks are extraordinary vulnerable. consumer staples and utilities all-time high valuations, more money going to passive investment there and minimum volatility funds. really one of the only growth areas exceptionally vulnerable to unreform in that kind of environment but the message is, the economy me is moving forward and as much as stocks look over valued based on the time since 2008, you are two full turns

below average bull market multiple peaks. >> we're out of time but i have one last question because when you talk about the fed and having to move because of psychology, sounded like you think the fed is going to move simply because of market psychology and not because it is seeingment in the economy. it's got to make a move to keep everybody feeling pretty good. >> it's a self-fulfilling prophesy. >> if they raise rates, people will feel better. >> absolute will you how it works. if anything friday shows us that the bar for getting more aggressive again is perhaps lowered, the fact is break even unemployment numbers are 100,000 a month. if we go back to 150, that's okay s okay. >> thank you. if i heard that and i did hear that, i would think that -- [ laughter ] >> good. >> i don't believe the fed then when they say that we're going to raise rates because the economy is looking better. >> listen, gdp tracking or

whatever, inventories are way up. you need the back end sales to reaffirm that number. i'm not an economist -- >> that sounded good. >> pretty good. >> sounded fantastic. >> listen, absolutely think the fed has to move not because they want to, not because the economy is getting better but need to give themselves runway and cushion. they know it and realize it but you ask richard fisher, ask him, i encourage you. he knows the real deal. listen to what he says and think about what he really wants to say if you strap a lie detogethdetector on him. >> he doesn't want to enlightening us too much. >> right. up next, tesla tanking into the close on safety concerns over the model s so how worryie should investors be and is old uncle carl the contrary indicator, it's the chart you need to see and later, several stocks that were given up for

dead are heating up big time in june. the names and whether there is room and time to get in. much more "fast money" right after this. the call just came in. she's about to arrive. and with her, a flood of potential patients. a deluge of digital records. x-rays, mris. all on account...of penelope. but with the help of at&t, and a network that scales up and down on-demand, this hospital can be ready. giving them the agility to be flexible & reliable.

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welcome back to "fast money." tesla and suspension problems in the model s and the company is going to offer a more affordable version of the model s said sedan, tim? >> right now we know the army of tesla owners are ridiculously loyal and it's a great car. the question is is it a great stock to own? i think the reality is that after that cap raise, to me, you've kind of broken the water so to speak. i think you're going to see more and need to see more. i think these guys are still burning cash fast, the free cash flow continues to get pushed out. it's really about valuation. there is a couple stocks i continue to rail against and mostly on valuation. this is a company where the expectations on production are still overly optimistic but the reality is even if they are getting there, the stock is not worth this. it will never dominate the main stream. >> i understand what you're saying about the cap raise and

concerns more cash will be needed but isn't this of trying to get the cash by generating the volume of sales at a lower price point in ordinary toer to the time? >> i would say that's a good point. i think the news today says not the -- >> you mean the safety -- >> not the safety one. the fact they have a $66,000 model s shows you there is real pricing pressure and the model s -- >> but they didn't drop the price is a different feature. >> i mean -- >> okay. that's a good point. >> whether you want a $35,000 one or $110,000 one. by the time the model three comes out, the model s will look pretty dated on the external. they have to keep reinventing. you can't put another letter after the model name and got a new car here. >> that's what gm and ford does. >> those letters confuse me. >> s and s. >> it's funny because they are only two letters, s and x and that's confusing.

>> i'm not that bright but made a good point about the economy. >> spot on. the conversation for months, how do you trade the stock? i said a couple weeks ago it traded really well off the secondary. it was trading 208 and priced it at 215 and went north of 230. not a great day today. stay long in my opinion against the 215 left couple weeks ago. >> well, i would be taking profits of tesla now. i think you've got a lot of uncertainty going on. 240 looks rejected fairly easily. that was a resistance point before i would just get away from this one for now. >> up next, when this man talks, wall street listens but is carl icahn quietly becoming the ult my contrary indicator. we'll explain, next. i'm melissa lee and you're watching "fast money," cnbc first in business worldwide. in the meantime, here's what else is coming up on "fast". >> here is what bank of america

says can happen to crude if one thing happens. the strategist behind the call will reveal what it is plus an unlikely group of stocks are sizzling as we head into summer. >> hot, dang hot, real hot. >> we'll give you the names and tell you if they are still worth a bond when "fast money" returns. using 60,000 points from my chase ink card i bought all the fruit... veggies... and herbs needed to create a pop-up pick-your-own juice bar in the middle of the city, so now everyone knows... we have some of the freshest juice in town. see what the power of points can do for your business. learn more at chase.com/ink

. welcome back to "fast money," backing out of it and calling to get out of space. >> i think listening to what you said he said, i get help and he has a couple real good points. you know, i think there is

trust. i've been saying it, i think that you have a sort of a false market void by zero interest rates and you have to be caware of it. >> if you listen to him, you may miss out of hefty gains for stocks to continue to make new highs. more recently the market over heated and said a day of reckoning would come soon. is he right or is carl a bit of a contrary indicator and granted, we do respect him as an investor. >> love carl. >> made great calls. >> great on the show. >> but on these macro calls, should we listen? >> you got to listen. i mean, you don't have to agree but absolutely -- because i think he's saying in some form including tim with everybody on this desk.

when he made the last comment, i think he said it before the melt down that we saw in february, the guy looked like a generous subsequently we've seen what happened. everything he said you should absolutely listen to. carl will be the first to say, by the way, he doesn't know what it's going to happen. we can call him a counter indicator or whatever but pointing out what we're trying to point out ourselves. >> carl is not alone, first of all. a lot of people had been indicators on this call for six months, at least and it's argued you can make an argument if you said this a year ago, you would have been right. pessimism in the market, i say what i think i said which is that repwe prayed for a correct in this s&p a year ago. it strange we haven't had volumevolume volatility. i think hedge funds, under performed and geniuses in february. burned it through and i think

hedge funds are actually missing the benchmark and will push the market higher. >> so, that again, i say this all the time is the biggest fear for me is that we get a rally, fear of missing out and get this melt up out there. i think it doesn't but in terms of carl, two things i would say, one, everybody will say we miss this, missed out. over the last year s&p is up half a percent. what did you miss? you didn't miss a thing. soros and carl look at the market a different way because they are managing their own money and know this game is about capital preservation. eke out 5 to 10% or lose 20%? better to stay in the game, live to trade another day. >> up next, bank of america's research say as potential black swan could be looming for oil. he'll be here to tell us what that is and just the other day, there was a rumor kellogg was in play and traders are betting another consumer stock could be the next hot takeout target. we'll give you the name when

"fast money" returns.

welcome back to "fast money." the dow and s&p, here is what is coming up in the second half of the show, is clinton bad for biotech? how the democratic presidential nominee could impact the space and why is wall street so nervous in a special report, plus the, summer is upon us and one unlikely group of stocks absolutely sizzling. we'll give you the names and trades but first, treating today for the 2016 highs snapping a three-dahl rally but a black swan event could be in the cards for crude. the head of global commodity research at bank of america merrill lynch. great to have you here. >> thanks for having me. >> what is this event? >> we think there is a potential black swan or 24 months, which is the saudis depegging currency from the u.s. dollar. hasn't happened yet.

something that's been talked about and could eventually happen. >> why would they do that? wouldn't that be destabilizing? >> i think help in the immediate term with plans with 2020 or 2030 vision, which ever year they target at this point because remember, right now the saudi government has a huge deficit and frankly, they are seeing a big throw down in foreign exchange reserves and countries are experiencing, they have floating currencies like russia or norway or chille or canada. >> you say it's not next 12 to 18 months or so. it also implies that it's hard to really say that it's a probable event. >> right. >> at the end of the day, what do you think? will this happen? >> look, it's hard to tell. not for me to decide. i do think that the saudis will probably not be forced into

breaking the peg. they have enough reserves and enough money in the bank so to speak to prevent it. something that will help in the long run. why not do it? that's the debate going on inside the saudi but also across managers around the world and a huge impact on the way we think of energy and oil prices. >> right. i'm curious, is there something else out there that may forced saudis to do this before they can? i know they tried to cut off speculators. what happens have venezuela inploids? >> that's a big challenge. as saudis increase production and getting close to maximum productive levels, any kind of disruption is harder and harder to cope with. a venezuela collapse in terms of output will effectively put pressure on prices throughout the course of next year. and i'm not sure we have -- we

have high inventory but not the right capacity to cope with that disruption. >> your forecast in terms of the range for crude next year is 55 to $75 a barrel, is that correct? >> we think oil prices will average $61 a barrel and we'll see it high, maybe 75. i think the lowest could be a little below those levels, maybe 50 on the low side. but certainly we're generally constructive on oil. we think prices are pushing higher and supply is coming down across parts of the world and demand is strong. >> if your black swan event comes to fruition, then what? >> i think it's going to be a lot harder to forecast prices in u.s. dollars because that's the benchmark we're used to. i think if the world starts player from the u.s., it's going to be a lot more difficult. >> isn't there slowly, though, a decoupling of dollars. settlements in euros from iran. you have a situation where this is already changing right now. >> right, if you go back to the

'80s, we had russia, saudi, the u.s., the opec to the same currency and 40% plus of world production. russia is a floating currency for awhile. >> you're right. >> the rules are swinging. >> been great. >> saudi and russia kept on moving higher despite the fact they have sanctions and a lot of economic issues and russia managed better than they would have otherwise with a swinging currency. if the saudis follow their path, then it's going to be a little trickier to forecast oil prices and i think al lot of equity. >> francisco, thanks for coming by. francisco blonk for merrill lynch. and the black swan. >> listen, i've been wrong. tim has been on this and continues to levitate higher. i will say this, i think some of the things that he just spoke about are one of the reasons that people continue to buy gold. people are trying to get away from the perceived fiat currency that is the u.s. dollar and

doing it in many different ways. the most important way to me is the hoarding of gold. >> the gold thing, we had a great conversation before. gold was on the mat. the five-year lows and just until this year, until the fed didn't do what people expected them to do it's up 20% but still down 35% from the 2011 highs here and doesn't really look like anything other than speculation. how many times have we heard people say that's where you got to be and get a lot of torque. we had mark cuban doing that and call volume is amazing. to me, i don't see this commitment. i see a lot of talk about it but i don't think that's for your portfolio -- >> why not? why not? listen, it is the ultimate market, right, because what will you use it for but seeing, you look at stan who has 30% of portfolio. we don't know how much soros has and banks in asia buying gold. people are hoarding gold. why is that? i don't get that at all. >> it doesn't give you yield and

in a place -- its defensive. these guys are praying -- price is going higher. what i don't understand is everyone talking negative things and the reason the world will fall apart, the dollar is anything going to rally or saying you're actually saying things are so bad the fed can't do anything and never going to hike again. that means a weaker dollar will help the gold trade but ultimately if we're in a world as dangerous as everybody says, a flight to quality in the dollar and that is going to i think ultimately be -- >> i know where you're going. the correlation between the dollar and gold has broken down. it's actually positive at this point. this happens on rare occasions. it's happened probably four or five times in the last 30 years and a scenario we're seeing. >> i want to bring this back to oil. sorry. that was the top pick. >> i got a quick comment on that. >> yeah? >> some of the things francisco said are important if you want to think about the economies in the position. they did let they are currency devalue. russia $30 oil was 20% off the

budget because the currency and local ks very good. operational leverage for more expensive oil price. >> coming up, the weather is getting warmer and there is one group left for dead stocks sizzling. we got hot names and should investors be afraid of hillary clinton? we'll explain why the presumptive democratic presidential nominee could reek havoc on the space.

r

. welcome back to "fast money." out performing the s&p 500 breaking down the summer sizzlers is the always hot dom chu. hey, dom. >> guys, you're making me blush a little bit. [ laughter ] >> anyway, it's good to be with you guys. so we want to take a look at summer sizzlers to see if momentum can continue. we'll admit some of these stocks are in the more shorter term i guess up trend you can call it. let's put them up to see what you think. a lot of hot stocks in the month of june are among the most beaten up over the course of the past arguably fewer months and longer than that. you got a name like michael kors. a top sizzler month to date in

june, a 19% gain. a stock remember, on the retail side of things that hit a 52-week lowerli lly earlier thi year. gap stores have seen the old navy line can't seem to get comparable store sales ramped up. those shares up 7% albeit again off of lows we've seen just recently. nordstrom, under armor, kohl's, you get the drift here. a lot of retail names are sources of perhaps, i would say possible opportunities for upside as traders try to bet what could be a bottom but picking bottoms is the hard part. still, it's intriguing retail names are getting spotlight especially as we approach the back to school season that does impact some of these guys and some of the other guys like kohl's where spending really ramps up going to the fall. it will be interesting to see what happens, guys? >> the big question is does this mark a turn around this anyway

or a dead bounce because i bet a lot of guys on the desk think dead cat bounce. >> right. i would say that. i'm very curious to hear what the guys say about this. there is a sense now the consumer discretionary stocks that had been darlings for some point over the past couple years are starting to show signs of weakness about concerns the consumer really perhaps won't be able to power what these guys do with profits over the next upcoming year here. what will be kind of a curious note here is whether or not we do see some of the retail oriented like outlet-type names. tjx, ross stores and what not. if they start to do better. what does that say about the overall economy if those are the types of stocks and companies that thrive in an economy like this. >> dom, i'm curious on any of these, it seems they would be high insured interest stocks. >> some of them have high interest and maybe a dead cat

bounce because you have this move higher. it's a massive move higher say for michael kors or eight or 9% move something along those lines but whether or not it sustains is key here. the reason why i guess i stress the short aspect of it is because we have seen such a pronounced down trend, longer term a year or more for some of the name, especially for michael kors. michael kors unlike other names did hit a 52-week lower early, i want to say in june or rather january. so that's a stock that seen at least a little more potential upside trend over a medium term as opposed to a nordstrom or gap stores trying to maybe just bounce off a low over the course of the past month. it really depends on the medium term goes better. all of these retailers we showed have been in down trends for the better part of a year or more, guys. >> dom chu, thank you serving up the sizzlers in retail.

>> always, year around sizzling for the chu. >> what is more interesting, fascinating to look at beaten up stuff with dead cat bounces but i'm more focused on home depot throughout the bull market and traded really well and down about 6% in the last month or so from highs and you look at the very poor performance of nike, starbucks, target. i know walmart and target are diverging. most of retail and apparel is having a hard time right now. >> looks like in dom's rig, he had something from all five of those stores, interestingly enough. >> you could see it if you noticed quickly. i'll say this, recall this because i remember sitting right here -- [ laughter ] >> so, so, for the record, i'm trying to figure out where -- i think maybe some of the stuff comes from nordstrom, maybe some from kohl's, i guess. i don't have anything from under armor on right now and i don't believe i have anything from gap on right now. >> check your bag there party

boy. what do you got next to ya? right? don't you love dom? we should have him back. >> he's rocking a pair of colorful, cool socks, we know that, dom. >> i do have socks, they might be from nordstrom. might be -- i have to look at receipts. >> nothing wrong with that. we talked about macy's, not macy's. gap stores threw in the towel. stocks closed at 17 that day. the next day same low, big volume. we said now is your opportunity. look at gap now north of 19. bad day today but gap is interesting here on valuation. >> look, these got destroyed and trading at ridiculously low momentum. when we talk about strength, we talk about very short term and these were trading at eight, nine, 11 when they should be trading 40, 50. gap at the top end of the range, nothing happened. there is nothing different in gap's world ralph lauren, going through a transition and after

you take a shot on a brand trying to become less. that's half the problem in the retail space. the valuation interesting. i'm definitely talking -- i think this is something where not all these names are created equal and i think if anything i'm fading this retail move but names i like. >> like guy's restoration hardware call on ralph lauren. >> right. open unloads, close, big volume day and traded close to 30 million shares. we'll see what happens tomorrow. up next, consumer staple spaces sending one group of traders into a frenzy. details and fear and panic, are those two words describing how biotech investors should feel if hillary clinton wins the white house. meg terrell has a special report. you're watching "fast money" on cnbc first in business worldwide. ♪jake reese, "day to feel alive"♪

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welcome back to "fast money" following today's endorsement all signs point to hillary clinton becoming the democratic presidential nominee. will this development signal a sale sign for biotech. time for a political edition of stock therapy with meg terrell. what's the feeling? >> people expect headline risk around the election to continue to pressure biotech stocks, the

god father thinks this is primary based in but a lot of analysts expect the pressure to continue as both candidates, hillary clinton and donald trump made comments that are generally perceived to be negative toward the drug industry which a lot of people think are comments. hillary clinton come out and said she would of usually defend the affordable care act, something all republicans have come out against and allow medicare to negotiate on drug prices, which scares investors if they lose pricing power, that's one of the biggest threats. one interesting thing about the platform is she says she would increase the funding for all timers disease to $2 billion a year. right now the nih spends 500, 6 oc 00 on alzheimer's and she would do that as part of a step up in general. that would be good for the drug

industry. specifically companies working in again, lily and merck and see a direct correlation in trending in stocks like thurom fisher because labs buy their equipment. that's interesting and people don't think about that so much with hillary clinton. that's a big part of her platform. if you look at donald trump, he's come out and said he would repeal obama care, which surprises nobody but makes really anti drug industry comments like allowing the importation of drugs from other countries like canada where they are less expensive and allowing medicare to negotiate. i'm hearing analysts and investors are clear on what hillary clinton would do. that's good. they are not so clear on what a trump presidency would mean for the drug industry. >> surprised. >> surprisingly. everybody says we'll see headline risk into the election and whether people can elect anything after that is a huge question mark. >> right. just the pricing issue on which

both candidates agree the drug prices in general are too high. isn't that enough, the rhetoric? we haven't had a piece of legislation or anything done, right, since hillary clinton tweeted that tweet over the summer and yet, we've seen a really sharp retrenchment in the sector on fear. >> there is a lot of fear around it. that's the thing. it's weird how this disconnect between the fear and then the disbelief that anything is actually going to change. so you have to wonder, the environment is tough. insurers pushing back, that's what worries people about stocks. >> guy? >> the ibb is where we go and i hear everything meg says. she's been on top of the story and if hillary gets elected, her first 100 days is a bull's eye on wall street. with that said, look exactly where the ibb traded up to and look where it failed. we had been talking about 285 for weeks leading up. printed 286 the other day and

retraced back down to 273 and 274. i do think you need another shot to buy the ebb at 240. a level we talked about i want to say back in the winter and i do think the pressure now, the pressure to prove themselves. i think the path of least resistance is lower. >> yeah, well, so i've said you sell biotech in general into the election and possibly after. the reason why i say possibly after is something that meg brought up. the question is what can they actually do. we're in the speculative phase everybody is worried but can they get anything done? will nih funding come through and will they cut drug prices or not? going into the election, probably more speculation after the election is probably where you want to look at buying biotech. >> the point about disconnect is the most important thing because you can rationally layout all these great points why nothing will happen but that doesn't matter. the direction of the sector has been lower. >> well, and so i think lack of

clarity and lack of certainty, these are usual tenants we talk about of investing are not helping. what you have to do therefore is find relative value and i think you have to find companies, those that under for formed and looked interesting. gilead is an interesting trade, if nothing else based upon what under performed versus what hasn't and on valuation -- >> do you mean a pear trade. >> to be long gilead so make yourself essentially sector neutral but find a company under performing and why have the under perform but valuation is interesting at gilead. >> last question for you, meg. when you talk to investors, are they actually making any sort of portfolio changes based on what you outlined? >> i talked to mostly biotech folks so they are just making picks. for the most part no but i'll come back to you if i get a better question. >> meg terrell with stock therapy. >> love stock therapy. any kind of therapy, guy. >> good point. >> i don't know about any kind of therapy.

i'm sure there are plenty of therapies you don't want. anyway, shifting gears because dan is not here anymore. he's -- >> where did he go? >> at the smart board looking at unusual options volumes. >> yes, in hersheys and this is speculation from time to time over the last decade of takeover chatter from here and there but the options activity speaks to that rumor going around the market. today options was 27 times average daily volume. the amount of options that traded today were equal to the amount of open interest in options, in the stock coming into the day. so this was a frenzy when the stock was trading about 9630 today, there was a buyer of 2500 of the july, 100 calls. the buyer paid $110 for 2500. 15,000 traded on the day and a buyer of 5,000 of the june 100 calls. what i'll talking about here is that these are out of money. if you look at the one-year

chart. you can't see it on the one-year chart and buy income a frenzy and name like this that generally doesn't have a lot of options. something speculative going on here and one last point. bought or not but if you look at where the break even on this thing is, it's back towards the level the stock broke down from a few years ago. this is one way to define your risk in a speculative way. i don't chase rumors like this but this is one way to do it. >> a quick note, we reached out to hersheys regarding the takeover rumors and responded by a matter of company policy we do not comment on market speculation related. up next, final trade. i'm here at the td ameritrade trader offices. steve, other than making me move stuff, what are you working on? let me show you. okay. our thinkorswim trading platform aggregates all the options data you need in one place and lets you visualize that

information for any options series. okay, cool. hang on a second. you can even see the anticipated range of a stock expecting earnings. impressive... what's up, tim. td ameritrade. new biwhat are we gonna do?ys... how about we pump more into promotions? ♪ nah. what else? what if we hire more sales reps? ♪ nah. what else? what if we digitize the whole supply chain? so people can customize their bike before they buy it. that worked better than expected. i'll dial it back. yeah, dial it back. just a little. live business, powered by sap. when yun live, you run simple.

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time for the final trade. let's go around the horn. >> oil, we talked about it tonight. the companies in the best position to have operational level. >> so the weakness in european banks does flow back to banks xlf. >> well, for me it's back to the precious metal space silver held up well despite the strong dollar. >> i hope.

>> dan is going to be there. >> when is it not big? hello? anyway. >> might. >> defense stock rtn will get you done. >> i'm sure. >> i'm melissa lee, see you back here >> i'm sure. my mission is simple -- to make you money. i'm here to level the playing field for all investors. there's always a bull market somewhere, and i promise to help you find it. "mad money" starts now. hey, i'm cramer! hey, i'm cramer. welcome to "mad money," welcome to cramerica. other people want to make friends, i'm just trying to make you some money. my job is not just to entertain you but to keep you and call me. call me at 1-800-743-cnbc. or tweet me @jimcramer. taking a breather. could have been worse. even as the dow closed down just 20 points.