month, that's a reiteration for him. he's saying you have to get out in front of the trade issues and all the rest of it i think we're fixated over the next two weeks over what the fed is going to do and say. >> more fed speak throughout the week including if he had chair powell on friday and that key jobs report as well. >> facebook, i think, too. >> that's right. >> we're also awaiting result in parliament any minute. we're out of time here thanks for watching "closing bell." >> "fast money" begins right now. live on the nasdaq market site this is "fast money." i'm melissa lee. tim see more, karen if i hadder man, guy dommy a tuesday tumble stocks kicking off september in the red and one start shows we could be headed for a point of no return. also ahead investors slamming the brakes on uber and lyft, why these two stocks could signal a rough road ahead for ipos. brexit drama heating up and the currency market is taking notice. we begin with today's selloff, stocks taking a nose dive as the new round of tariffs

kicks in in china and the u.s. manufacturing sector contracts for the first time in more than three years. all three major averages ending the day in the red is this just the beginning of a bigger september slide guy? >> we talked about it last week. quite frankly i thought we would rally today, i thought thursday, friday made sense we rallied, i thought we would rally again today and towards the end of the later part of this week, early next week we would start to slide. things are not bullish for stocks right now if the only case for bullish in stocks is that valuations are reasonable and rates are going lower i think you are on pretty thin ice it feels like the market needs to have the next leg down. what i've said before and what i will say again, i think the market bottom will be defined when the vix trades on or around 30, we are at basically 20 now you do the math. i think there is a huge move coming and i think it's going to sort of begin in the middle part of this month. >> dan >> yeah, so, you know, carter was on the show on friday, talking about this range we've been in the s&p 500 since that

first gap down august 1st on those announcements of new tariffs and we have just been banging around in what feels like a 75-point range in the s&p 500. i think the thing that you want to watch is yields obviously september 18th is going to be a huge focus with what the fed does, whether they cut 25 basis points or 50 basis points, either way i think the market is either disappointed or they're freaked out and so to me, you know, i think that that 200-day moving average in the s&p 500 down at 2800 that's a really big level if we go there first i think you want to keep a really close eye and then rates, ten year treasury yield trading where it did today, a news cycle low, 1.had a or something like that, keep an eye on that, if that goes precipitously lower i think the s&p 500 falls. >> that's almost like a no win situation for stocks. >> i think it is. >> whether the fed cuts from 25 or 50. >> what a surprise from dan. >> there are a lot of bulls out there who say lower rates -- the rate great for valuations, we can have valuations that go higher but are we at a point where rates are so low they mean

rates are low because the economy is slowing >> we've had a lot of strategists come on the market -- on our show and talk about the market in the context of a fed that's maybe being preempti preemptive 50 is not there there and they think 50 dan thinks bad news will be bad news up until this point a fed -- and i mean historically for points where you saw the fed go into an easing cycle even though we heard the last easing it was a mid cycle adjustment that would probably be good for stocks what dan and carter on friday and what people should be -- what is noteworthy is 24 sessions of essentially 150 point range on the s&p which is pretty extraordinary considering the elevated vol within that time i would say if you want to find a silver lining, the silver lining is that during this time we have devalued the juan, you've brought the dollar up over 90 and the dollar is typically a wrecking ball, you've had the ecb scramble in place and possibly deliver

almost nothing next week when they report and yet here we are 4% from all time highs my guess is if you are a technical guy you're looking at that and say it's bullish. >> what if you are a value guy >> i am always value oriented and normally things trade down a lot and i think, all right, too i'm to start buying. i'm not buying anything right now. i'm really concerned, i think we're 3.5% off the high, which really is nothing and i don't like how we set up -- i mean, to me the trade issues are front and center and i like to base valuations on fundamentals we are in a bit of a period where we don't have fundamentals right now, most of the companies have already reported and i don't even know if it will matter how good the third quarter will be because we have these -- this tariff situation, it will be much more about what's the guidance, what are expectations for the fourth quarter, how are companies feelin this prolonged trade war an to be

settled in the long term that that will have cumulative effects of hesitation by ceos, maybe the consumer, we haven't seen that yet, the consumer is still out there, but it just makes me concerned and i'm not out there buying to your point the vix, i'm surprised the vix isn't higher. >> what are valuations on the s&p 500. >> 17, 17.5, which is not ridiculous i mean, historically it's pretty reasonable i would think and given the environment we are with rates it's probably very attracti attractive, but markets go down for other reasons other than valuation. i'm not suggesting this is '08, '09 but quite frankly valuations had nothing to do with the softs we saw then. valuation argument i understand but not necessarily the right one. with that said if you're looking for something as an indication and dan has talked about this, the russell, that's been a very good leading indicator and 145 which is we are in a whisper of that, that's sort of your line in the sand.

i think if that were to break below 145 it's going to make a run towards a december low, a run towards a december low is around 130 and i think that drags the s&p down. >> it's interesting. a lot of people are trying to look at data points to try to figure out when own to recession -- and i think there is some stuff in the market telling you things are topping out. you mentioned small caps if you look at the transports overlay that chart for the russell 2000 they are down 15% from their 52 week highs the kre also down 15%, 16% it's the same chart, the same wedge, approaching really important technical support. look at the ibb, there's a lot of stuff that is in major correction not acting particularly well. so i think there is some kind of tea leaves in the market if you want to look at them by the time you piece together all those economic data points it tells you pinpoints that we are going to have a recession at some point this 2020 or 2021st going to be too late i'm going to tell you this, the last two times we have had recessions in this country the s&p 500 has been cut in half both times

2000 to lows in 2002 and then 2007 highs to the lows in 2009 that's just a fact that's what happens when we do this >> we've got some breaking news from the fed let's get straight to steve liesman with the details. >> boston federal reserve president in a late speech is pretty much unconvinced about the need for any more rate cuts. he says should the risks that he talks about the trade war, global economic weakness become a reality in u.s. economic data then he says the fed should ease aggressively but so far economic forecasts the level of the market, talks about the level of stocks, talks about credit spreads, so far they do not indicate the kind of weakness that everybody is so afraid of he does say that the trade disruption and the global weakness are the biggest risks in the u.s. but he's still expecting 2% growth which is slightly above the potential in the second half and he says it's right around this potential range. gradual slowing of gdp is what he expected not a single of a coming recession you may compare and contrast that with st. louis fed

president jim bullard who earlier today suggested the fed go 50. you either get nothing, you get 25 or you get 50, melissa, back to you. >> so when he says that the fed should cut aggressively if the risk to the u.s. economy materializes, what's your sense of what that means i mean, it's not a mid-cycle adjustment and it's a string of cuts, because as you had mentioned this morning, steve, we are already expecting 100 basis points of cuts between now and april so more aggressive than that is i don't know what. >> you know, i think there's a couple ways to look at it. the first thing is for a guy like rosen gren i think other members of the board does their outlook for the economy come down substantially they are still expecting 2% growth all the folks who don't want a cut that we talked to in jackson hole and since are people expecting 2% growth which is what they had expected, also what they think the potential of the economy is those who are looking for weaker growth would be looking for greater or more cuts and the weakness would show up in stocks they would think they would show up in employment and it would show up in the gdp numbers.

>> all right steve, thank you. >> pleasure. >> steve liesman how does this factor in? we have a fed meeting in a couple weeks or so. >> it's massive for the market dan was right to at least highlight that your decision tree is certainly -- i think there's going to be volatility based upon this fed. i believe it's going to be harder for the fed to apiece everybody here we have seen for a couple meetings in a roam it has not been that easy for the fed to thread the needle, a term that's way overused there is no fabric you could knit that would allow these guys to get this thing. what i want to say about the market is the other side of all we hear about is you actually see the s&p at 12 to 18 months after an inversion think about the stock market and the economy. typically the stock market bottoms six months before the economy does so if you think, you know, that this is going to be a nasty, nasty, pull back, then obviously you could say that this is going to get much, much worse and stocks still have a ways to go because the economy is not within six months. but if you think that this is not going to be a deep

recession, we get a trade deal, you can make some arguments that historically the stock market has done what it's supposed to do and maybe all it's supposed to do. >> when you think about recession, you see the consumer and the consumer is still very strong. >> right. >> how does that happen? >> i don't know. i was looking i was actually looking up today what causes a recession and it's high interest rates, high unemployment, right, and we don't have some of those fundamentals pillars one thing i will point out that's interesting, though, the dax even in the last year even if rates have gone subzero and significantly subzero the dax has rallied over the last year >> so lower rates supporting valuations. >> i guess >> but you guys are forgetting one point about this we are also putting this recession thing out way into the future to tim's point risk assets start going lower. negative wealth effect plays into the recession big time. you start overlaying some of the things we're talking about with this pmi data that we see. that means if we are going to go into that sort of manufacturing recession that means less hours

worked, means job cuts eventually it just starts happening, little chink by chink, that sort of thing. to me no one is going to be able to put their finger on it but i think there's enough data here to suggest if this trade war goes on cut to zero, have a ball, it doesn't matter because global growth is slowing right now. >> when dan has have a ball -- >> but it doesn't matter. >> we know he's frustrated. >> when the fed got aggressive cutting rates they went to 1% in 2001 and 0 in 2008 the s&p still got cut in half. that's the point, it just doesn't matter. >> i agree with you and the wealth effect quickly of markets and what rosengren talked about right now it actually feels pretty good for investors and that wealth effect has not bit but the dollar is the biggest drag in the economy. the conditions are fine. >> our next guest says the fed can keep cutting rates here, actually we have some breaking news sorry. we're going to go straight to wilfred fox with news on brexit. >> we are awaiting the result of

that vote in parliament to where we believe mps are trying to seize control from the government, from prime minister boris johnson of the agenda and they have succeeded. the rebels have succeeded and defeated the government 328 votes to 301 so abos johnson's own conservative mps must have voted against him for that to take place what does this mean now for brexit it means tomorrow there will now be a vote aimed at tying prime minister boris johnson's hands to take no deal off the table because he has lost tonight's vote it's highly likely tomorrow's vote will go similarly to today, the same rebels would once again vote against boris johnson and his hands would be tied to prevent no deal. he's speaking at the moment and he's likely outlining the fact that he expects to fire those torrey rebels from his party and this all increases the likelihood of the country heading towards a general

election in the coming weeks because the government has just lost a very significant vote and the first big defeat of the relatively new prime minister boris johnson. i don't know if we can check in on the british pound which earlier in today's session fell below the 120 handle, it's well above that today, recovered intercession and hasn't moved much on this vote. this vote was kind of expected, though a bigger defeat than perhaps prime minister boris johnson was expecting. certainly a bigger defeat than he wanted to see melissa. >> so, wilfred, when you say further elections, i mean, if the vote tomorrow basically ties boris johnson's hands further, that means that he is in jeopardy >> no, it doesn't mean he is in jeopardy immediately kind of conversely because his hands have been tied he is expected to personally seek an election so that he could get a freshman date and perhaps a majority to untie his hands, as it were, himself it's not a foregone conclusion,

though, that that election would be granted to get an election that he seeks himself he requires a two-thirds majority, a big hurdle, of course, while parliament is so divided though it is expected if he tabld it those who have been calling for change would be kind of inclined to vote for an election having said they want change, they could hardly say but we don't now want an election the first step tomorrow is the actual vote on whether or not no deal will be taken off the table. the expectation is the same rebels that voted against the government today would vote against them tomorrow. so that's largely sort of expected to be a foregone conclusion tomorrow and then the next thing to focus on is does the prime minister seek and get granted a general election or not. >> got it. okay wilfred, thank you wilfred frost with the latest developments on brexit. so if a hard brexit or no deal brexit is off the table -- it should be very interesting meeting next week.

>> right but, again, there is no real -- the bad stories outweigh the good stories right now in my opinion. again, the market is hanging in there and that's the ultimate judge and jury, the fact that we are within 3% of an all time high people say it's shed all this negative news, looked past it, the market must be fundamentally strong, it's hard to argue against that, but with all these headlines out there at a certain point this matters the vix at 20 is too low the vix in my opinion will print 30 and when it does that should be the culmination for this market. >> i think in the micro of this moment what the pound means to me is the pound is a risk currency seeing the pound break through 119 was a very bad risk moment overnight, it coincided with -- you can argue who is the tail, who is the dog, but i want to see the pound if i'm looking to take on risk i want to see it back over 121. we're just getting started here on "fast money. up next, more bad news for boeing, we will tell you what sent the stock into major

headwinds today. later protests turning violent in hong kong we're live there times squarine new york city. much more "fast money" right after this by the strolle♪s

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money. more bad news for boeing, the stock under pressure today on a report that the 737 max might not return to service until 2020 phil lebeau is in niagara falls with the details >> reporter: this report by the "wall street journal" highlights something that's been simmering under the surface when it comes to the 737 max, will regulators around the world, whether it's the faa, the europeans, china, canada, brazil, will they all be on the same page when it comes to recertifying the 737 max. this is what boeing's expectation is, sometime this month or early next month it will apply for recertification it's boeing's expectation that shortly after that the plane will be recertified and then sometime in the fourth quarter it will return to service. now, for airlines they continue to move back their schedule for when they expect the max to fly again. remember we heard over the weekend from american airlines it has moved back the max on its schedule to at least december

3rd. last week united moved it back to december 19th and we know for some time southwest has pushed it all the way back to the beginning of january as you take a look at shares of boeing while it was under pressure today in part because of this report but the market overall, remember that most people look at the stock and they say eventually because we have not seen mass cancellations, in fact, we haven't seen any cancellations, this is a delayed cash flow gain and the question is when does the cash flow pick up when those deliveries return and, again, this all hinges on whether or not regulators start to sign off on the max recertification sometime in the fourth quarter melissa. >> could u.s. regulators approve the 737 max for a return to flight and they fly in the united states but not overseas >> yes definitely a possibility and i wouldn't be surprised if that happens, that the faa says, do you know what, we're comfortable with this. now, in the past, melissa, when the faa made a decision 99% of

the time the rest of the world went along with it that's not going to be the case this time with the max there will be some regulators in other countries who may say it's good enough for the faa and we've looked at the data it's good enough for us, but don't be surprised if the chinese and europeans take a little bit more time. >> all right phil, thank you. enjoy the falls. phil lebeau, niagara falls on the canada side. boeing shares are down 20% since the worldwide grounding of the 737 max, what should we expect from boeing >> you get into production lines, if you actually get a big enough of a delay you could have a production cut which gets into labor pools and they want to hold on to this labor pool but it would then eat into your free cash flow story which i think is still alive and well in this name until we know there's something else going on other than the microprocessor issues, they say they were coming sometime in mid-september was my understanding.

i still don't know that this is a reason to be overly concerned. >> basically they cut production and risk losing workers to other manufacturers potentially. when they're back up and running they can't replace those workers as easily. >> i can't speak to whether they will get these workers back. i can speak to the fact that the production line will take some time to restart. >> obviously the china situation is not helping, either it's not just the 737, i mean, you can't discount the fact that this china thing has dragged on a lot longer i will be the first to tell you when this took place i guess late if he february is when thi boeing news came out here we are in september -- >> max is max. >> stop right there. >> with that said when it traded down that day it traded down to 360, we're basically at 360 now. although the stock has gone on either side of it we are exactly where we were five or six months ago. i can make a bullish case, but understand if people say, do you know what, there's so much uncertainty here, we have to

wait on the name. >> i don't think today is additional uncertainty when the airlines reported their earnings they talked about they are not sure exactly when they are going to have the 737 max, december or january i don't think it makes that much difference i do think that the certification is the critical issue. the stock will trade up if they get that. >> it's interesting that phil left off in saying that usually the faa's word was as good as -- >> right. >> they have 400 of these plains that are grounded, they have orders for 4,500 of them this plane came into existence because the boeing company was hustling to catch up with airbus's a-320 is there a scenario where they don't get the certification, there's serious problems with this mechanism that helps kind of move these motors and stuff like that and a maybe they just need to shift gears, no pun intended it seems like a really weird story. the other thing i have to he will tell you, phil lebeau up in niagara falls do you think he met all those girlfriends he had up in high school back in the

'70s >> what are we talking about >> don't go there. >> i have no idea what you're talking about. >> really? >> the '70s. >> used to have girlfriends up there. she lives in cap da, do you remember, niagara falls. nobody >> you can read more about boeing on our website cnbc.com i'm melissa lee, you're watching "fast money" on cnbc here is what else is coming up on fast. >> all in on amazon. one top ranked analyst says the stock is set to soar so is now a prime time to get in we'll debate it. and later uber and lyft hitting the skids today. why these two stocks could be telling the rest of the ipo market tbule uo ckp. stick with us, "fast money" returns right after this to man. to collaborating remotely with your teams.

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welcome back to "fast money. markets having a rough selloff today to start the month our next guest says there could be more pain ahead let's bring in dan suzuki. good to have you back. >> thanks, guys. >> so what is the catalyst that keeps a selloff going? >> i agree with everything that guy said, i mean, always, but especially today because what do you have to hang your hat on why be a hero today when all the news is really bad our view -- like this market this year has been riding on hope three hopes, hope that earnings was going to bottom and rebound, hopes that the federal was going to come in and save the day and hope that we are going to get trade resolution all of those things have got called into question and the data on profits which is the most important part of it is horrible we just got the ism number out today, really bad. you guys were talking earlier about the consumer, that's the shining horse, the thing that's holding up this economy, i don't think the consumer is that good. if the consumer is so good why is consumer discretionary why are their earnings contracting

as of the second quarter why do we have this big slowdown in the services pmi one of the biggest in the last few years. all of these things are telling you things aren't that great in the economy it's not just an industrial part. you have to look historically. when you see slowdowns the consumer is always lagging if you look at consumer confidence it's always high before the peaks of markets. i don't think it's a good indicator to hang your hat on. i'm looking for anything that leads, to tell me that things are turning around i don't see those signs. any indicator i look at, whether it's core crew ppi or the actual itself, durable goods, all this stuff is going the wrong direction. why hang your hat on this hope trade when there is no data to support a rebound anytime soon. >> everything you're saying music to my ears because i agree with you, but at some point are there companies that you would find, all right, the value is so compelling here, i understand there's all these bearish elements to this story, but at some point valuation is such

that -- >> so rbi we are a macro firm, there is a very strong, you know, history of when the profit cycle is slowing defensive higher quality sectors and companies always outperform. you're seeing that, you're seeing that right now and you pretty much always see that. we think there is a good case to be made for continuing for overweight health care, staples, real estate and utilities. obviously the first thing one of you is going to come back at is these are really expensive part of the reason they look expensive is that you're looking at defensive rel sieve to the cyclicals. you can't look at cyclical earnings like that anybody who has covered cat would know you want to sell it when it's cheap and buy it when it's expensive if you look at the u.s. machinery sector it didn't look cheap as in traded at a discount in the history2005 and 2006 and didn't get expensive -- and it didn't get looking cheap until 2009 so that's the typical sector

so you're looking at defensive relative to this i looked at the history of the last three or four cycles, the defensiveness almost look defensive. >> what is the premium that they deserve? as an investor you still want to be disciplined even though they outperform, it's not at any place, it's not at any valuation. >> i think it is. >> it is >> you should look at, you know -- i think you have to differentiate the defensive sectors a little bit obviously with real estate and utilities there is a huge bond component. relative to everything that's tied to the bond markets actually real estate utilities don't look that expensive relative to long term treasuries or things like that or high yield bonds and things like that but in general if you look at this there is a very strong history, people always want to say this time it's different look at this company dynamic here, health care has all these political issues, but go back and look at the history of that sector's relative performance. when it has massive

outperformance it's during periods where the profit cycle is slowing and when it has massive underperformance it's usually early in the cycle when you see a massive pick up in earnings out of a profits recession. i think that's going to be the most important thing and that's what we are looking at today increasing risks i think that's the most important thing. i'm not saying buy now for the next five years hold your nose there will be points if you start to see signs that the profit cycle comes back, absolutely, those are not the things to own, but for the time being i think it makes a lot of sense regardless of the valuation so long as the fundamentals are holding up and the fundamentals for those sectors are holding up pretty well, especially health care which has underperformed this years. some of the best sales growth trends, you know, some of the best beats relative to expectations so and it's actually trading cheap relative to history. >> dan, thank you. good to see. >> you thanks, guys. >> dan suzuki of rba. >> love dan. >> we chatted off camera.

i think dan makes excellent points i mean, i have to say that because he agreed with me. con edison making an all time high today up 2% on a lousy tape is grade for con edison but you have to say to yourself does this make sense in the context of a broader market. i agree, i mean, i think you're hanging your hat on fewer and fewer things and if you think the fed is somehow going to bail us all out you have to ask yourself is the fed the fireman that's putting out the fire or are they the arsonist that's adding gas i would suggest it's the latter. >> speaking of safe haven and defensive plays the dollar hitting a two-year high today. metals, gold spiking to a six-year high, silver touching levels not seen as 2016 as a global selloff had investors rushing to safety. our next guest says this red hot trade to get even hotter let's go off the charts with todd gordon. >> first gold i think it's important tolook at what we've done in the last two decades i'm sure you guys at the desk

can remember trading gold at $250 an ounce. we have come up a long way, we've been in a little bit of consolidation, the recent run is this is this, the one thing i would note here is we did break above the 2016 high in gold, right about 1380, we are currently trading about 1560 just from a technical point of view if you get up through that 1700 from the technicals that we study, the implications are you might finally get that gold. i have gld, hold in my portfolio, not so much more in the options but just in the holding. i continue to like it in either an up or down stock market silver really interesting. again, that 2016 peak we have not yet eclipsed that, that's at about $21 in silver, we are at about 19 and change right now. i do think there is more room to go in silver keep in mind silver has industrial uses as well as precious metal properties. it could go again and if somehow the broader markets were to recover in terms of equities

one thing that i find really interesting here and there is a lot of talk in the precious metals right now is the gold/silver ratio. this has a long standing macro indicator. basically when gold gets up about 90 times the value of silver, the gold/silver ratio is deemed to be overbought. when that's happened you have seen a significant buy signal in silver so first here let me draw that 90 level up around there and the gold/silver ratio. first one is back here early 2000, you peaked out, nice little bump there in silver. same thing again here, peaked up around 95, nice little bump there in silver. here we go again, big breakout here, just starting to cecil ver move higher. with that 2016 point at about 21 i feel like they want to go up and get those stops. i don't have silver but i'm looking to add on any pull backs. one thing, one market that's got obviously much more industrial use and that is signal and kind of deflationary trends right now is copper. doesn't look bad technically,

but from the models, again, that we follow to get context as to where we are, we're right at that decision point. we really, really need to hold about 2.5 here in copper, if you break down that's going to be bad and you guys are talking a lot about fx, watch that australian dollar against the u.s. dollar and the yen. both pressing lows, if they do break along with copper that is certainly a risk off kind of deflationary indication. if it wants to hold i think we will be okay and we can kind of skate that >> todd, thanks. good to see you. todd gordon trading analysis.com i can see while todd was talking, dan, you were making the motion to sell silver. >> i'm just saying when you have a situation where people have woken up to what he's saying it's a pretty interesting situation. very clearly slv to get back to the 2016 highs at 20 bucks, but understand it just came from 14 a couple months ago. if you really are expecting copper to break down, the dollar

to keep rallying, all those sorts of market mayhem sort of stuff, gold and silver are going to continue to work. >> is it still -- should we still call it dr. copper in its indicator sense. >> the indicator is very important to me right now because it's trading lower with the crb ryan that's essentially your measure of all these core commodities, these are even some of the basic ones, resins, things that are not even counted by most people, that's cascading lower with yields you could make an argument that the yields are really the by-product of that, but what i would say about silver, i agree with dan, as much as it's underperformed gold, you are at a 90 rsa on a nine day, up 25% in 35 sessions, still underperformed, but copper is telling the story and simply on gold after five years of doing nothing and me being pretty bearish about gold around 13.50 saying it was going to fail there, the reason gold is values is because of deflation not inflation. that's why i think it can continue to go higher along with

silver, but silver is overbought. >> i think a lot of it has to do with the fact that the gold market is waking up, central banks are impaling themselves and not nearly as all knowing as the market probably thought they were ten years or so ago central banks, governments continue to buy gold, that's out there, you can look it up if you want it's true. and to tim's point, listen, freeport mac ma ran getting crushed, steel stocks -- i mean, u.s. steel was a $42 stock probably on it in march of 2018 when these tariffs were announced, supposed to be so great for steel companies, u.s. steel now has an 11 handle. again, stocks are telling you something if you just want to pay attention. coming up on fast, a potential warning sign in the ipo market, what the ride sharing companies did today that could be a big red flag if you are looking to go public are looking to go public first a bidrg op i

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welcome back to "fast money. check out the scene in hong kong from over the weekend, protests turning violent as demonstrators clashed with police. it was one of the most violent weeks yet in the months' long

standoff the turmoil taking a big toll on macaw, gaming revenues seeing their biggest drop of the year in august. wynn, mgm, sands all down as a result tensions escalating in hong kong, should you steer clear of these china-exposed casino stocks tim? >> depends on if you think we are kind of in the last part of this altercation which a lot of people believe has to be decided by the time you have the communist national party event in october i think if you look at the dramatic turn around in macaw which was rallying, part of the reason this has been so extraordinary is you actually had recovery in macaw through may. i don't think you need to do anything here. i think wynn is probably one of the ultimate trade war stocks and therefore that's your call i think it will continue to be vulnerable and i think this is probably a period where we don't have an answer. >> even if hong kong is resolved, we still have the trade war. >> the trade war

you have obviously the headwinds there, but then you ask yourself wynn is at the lower end of the range we've seen maybe since the fall or so, 100 to 105 level seems to be held up relatively well obviously in this environment bringing up valuation is somewhat moot i would think, but to tim's point if you think we are in the late innings of this thing which i don't, but if you do, i think wynn at 105 is really interesting here. >> i wonder, you know, we saw the drop -- this is for august. >> yes. >> in hong kong we saw retail sales down by 11% in the month of july. you have to wonder if you extrapolate what happened in hong kong to retail sales in the month of august? >> right i mean, i remember retail sales -- remember sars many years ago and it seemed disastrous and the numbers were horrible, no one was going outside, no one was shopping, stores were closed if you think that's a fleeting issue, then definitely buy, but i don't think it's fleeting -- i don't think it's over yet. >> hong kong pmis were 43 two months ago, ten-year lows, it's certainly not to get better in the short to medium term

i do think macaw-related is something -- this can't smolder through october. there is no way either china is going to let this happen or it's going to continue to go on that's just the pragmatist in me saying this. therefore, something i think will have to give. >> coming up, investors are pumping the brakes on uber and lyft, with he will tell you why the selloff may be signaling an even bigger warning space. plus shares of palo alto under pressure and investors are betting the in ipas just getting started. that and much more after this quick break. (soft music)

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video welcome back to "fast money. catch our documentary high risk, high reward cannabis inc find out why some experts with sounding the alarm on the cannabis industry, that's wednesday, tomorrow, 6:00 p.m. uber the stock falling more than 5% in today's session getting new details on one of uber's biggest investors ari moody has the story. ari. >> uber bought more than $1 billion worth of shares at 48.77 and $6.5 billion of shares at close to $33 all of those shares are now under water with the stock closing a at record low today below $31. add it all up and soft bank

which is uber's largest shareholder is down more than $6.5 billion on its initial investment that's when the vision fund bought shares from existing investors including travis kalanick and benchmark capital it was the centerpiece of soft bank's to create ride hailing companies across the globe another problem for soft bank is it was supposed to get two board seats along with its investment but because of an extended review into. foreign investment those seats never feral liesed and the ability to get those seats expired with uber's ipo in may for now uber had a no, sir board seats, a deteriorating investment and really not much it can do to exercise its influence. back to you, rel is a. >> when is the lock up expiration all of this seems to point to that there might be investors who would be inclined to sell. >> the lockup should be in november, that's six months from the ipo.

you would imagine there would be some selling pressure but at this price you really don't know perhaps they will wait it out and hope for some rebound. >> ari, thank you. ari levy in san francisco. for more on ari's story head over to cnbc.com. it wasn't just uber. lyft also having a rough time today. are these recent ipos flashing a warning signal for upcoming debuts this shows you the soft bank example a big investors could invest and still be under water after a year plus. >> interesting with soft bank, obviously they have a ton of money and long time horizon. most like vcs in early inn vemts give it evan is, eight, nine years, go public and find that exit six months, 12 months after the ipo. there are these massive growth funds investing along the way. i suspect soft bank is not particularly worried right now, they made that investment last year, this he weren't going to exit right after the ipo what it does say to investors,

normally this is when retail buys these things, but we know there was a lot of secondary stock and a lot of people own these things other than massive things like the vision fund. when you see these stocks with no end in sight to the down side it speaks to the fact this this is the most risk off thing that you could see because people don't know where the bottom s there is no price discovery, they have been only trading for a few months. >> we don't know how these companies will do in hard times, either these were started during good times and have operated in an environment of almost free money. >> certainly free money. if you talk about the capital market cycle i think and so that

might be just passed now i don't know how much today was on this issue in california about whether or not the employees can be independent contractors or not, maybe that's some of it, but i think the money losing nature of the business is far more problematic. certainly makes you wonder about we work. right? that is a more difficult sell than uber or lyft. >> i would think that during hard times the irs thing to go would be the shortest lease that you have and that's a we work, right? >> doesn't all go well it's amazing i think lyft reported on august 8th and we sat here saying what a great report and it was, they had a pathway to profitability, with he talked about it, stock was trading i think 63 in the aftermarket, we were cautious because the lockup was coming up within a couple weeks, but then uber reported, said, you know, lyft is evan auto better listen, we thought it would sell off a little bit, but here we are now at 45 in lyft and i

think it's getting lumped in with the rest. that quarter on its own in my opinion was a very good quarter and although i never thought it would get here, i think lyft is just too cheap at 45. >> i think what the market is telling you about uber and lyft is they're really one company. when you think about what their product s you mentioned ride rs, every uber that i got into the city has a lyft, every lyfter i get into the city has an uber. what is the differentiation other than price we got excited about the metrics for lyft because theres a more rational pricing environment right now. at the end of the day what happens with these companies with unproven business models, they consolidate is what happens. to me i actually think lyft is the most interesting part of this story because it's a pure play on what i think isprobabl the best demographic which is the united states for ride hail and that's only where they're focused. up next palo altogearing u for earnings tomorrow but better on danger for the cybersecurity stock. we're ve athlit e nasdaq in times square much more "fast money" still ahead. more like five million.

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welcome back to "fast money. time fournette working palo alto networks reports earnings tomorrow and the options market is predicting the cybersecurity giant to get slashed. we are over at the plaza with the action

dan. >> like you said, palo alto reports tomorrow after the close. the implied move in the options market about 7.5%, about $15 in either direction that's a little bit rich to the four quarter average move of 4.5% one trade that caught my eye and the most active put strikes today, looked like an accumulation of the september 6th this friday expiration 202 half, $202.50, 185 put spread buying that for $5 in small lots, 1400 traded on the day, that's looking for a move between 197.50 down to 185, which is basically in line with that implied movement. when you see this kind of short-dated put buying in front of an earnings event like -- like this in palo alto, you want to go to the charts here here is the one-year chart this thing has obviously been in a bit of a down trend here this 2 0$200 level is pretty go support. i want to go to the five-year

chart to show you how important this $200 level s that was the high back in 2014. look where you take that thing down to, this is 200 bucks right here this could be a long holder heading into this event understanding it could be potentially volatile and looking for near term protection. >> thanks for that, dan. for more "options action" live shows this friday 5:30 p.m. eastern time up next, final trades. ♪ ♪♪ ♪♪ ♪♪

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welcome back to "fast money. let's take a look at how the day ended, stocks tumbling, dow and nasdaq dropping more than a percent. not final trade, but, guy, first thing in the morning what are you watching >> the gold market that's been the tell, is high golder if gold is higher again tomorrow i think it doesn't particularly -- it's not particularly favorable for the broader market so gold market to me. >> final trade time. tim. >> i'm looking at health care, united health is too much political overhang in this over. i like unh. >> talked about the all the things that can go wrong, if the vix is below 20 which it is

right now i would be buying nor s&p puts. >> dan. >> we talked about things that you want to keep an eye on in the stock market, the kre, that's one of them, be careful with that one. >> consolation brands, look at the move since june, quietly up significantly stz. >> we will see you back here tomorrow at 5:00 for more "fast money. my mission is simple, to make you money i'm here to level the playing field for all investors. there is always a bull market somewhere and i promise to help you find it, "mad money" starts now. hey, i'm cramer. welcome to "mad money ". welcome to cramerica my job is to entertain, educate and teach so-call me at 1800-743 hv -cnbc or tweet me. i come out here and tell you what happened during the day and

why and what you can do with the