but it is considered behind the ball next to amazon and walmart its two closest competitors. pro motions. should help kroger, too, but again, will that last, guys, that's the question. will the dictate the stocks direction tomorrow also tell us about consumer behavior in general. >> certainly will. that will be a key read tomorrow, but as for now, the key thing to watch is "fast money," which starts now. thanks, guys fast money does start right now. tonight's trader line up, dan nathan, and karen finerman, should technology permit why what's been the biggest risk, we'll tell you how the fed could go from friend to foe, plus a brand new season of fo fortnite is underway, and guy has got a fast pitch for us, will the traders buy in or give up the ghost we start with a developing story out of d.c the justice department looking to crack down on protections for

social media companies ylan mui has more on the story >> reporter: the doj's proposal strikes at the heart of the business model for platforms like facebook, google and twitter, section 230 of the communications ccc act the first is what they're calling the bad samaritan bill, for platforms that facilitate or solicit illegal activity, and the second specific exemptions for child exploitation, and actual knowledge of elicit activity the doj cannot do this alone they would need congress to act to change the law. big tech doesn't have a lot of friends on capitol hill these days just today, republican senator josh hawley unveiled a bill that would remove text liability protections unless the companies

promise to act in good faith or pay a $5,000 fine to users if they don't meanwhile, democratic senator mark warner said that he believes section 230 has allowed companies to turn a blind eye to a host of ills, but melissa, he also said he's worried that the doj is using these tools as a way to get big tech companies to cave in to president trump back over to you >> what are the odds of anything p passing in congress. i understand it's bipartisan but there's a lot of bipartisan things that don't pass. >> we have already seen legislation that speaks to this. senator lindsey graham introduced the earn it act earlier this year. that has yet to get a mark up in committee. so what i think you're seeing is a lot of legislation just getting stalled because of the pandemic, because of the logistics of marking up bills these days, so i think that the odds of something happening before november are very small you will see a lot of rhetoric coming from both the

administration and from capitol hill. >> ylan, thank you, a dark washington, d.c. for us. so we don't know what form anything will take place in. whether it be legislation or our targets, by regulators, but what we know is big tech has a target on its back. so dan nathan, how do you trade it, it's remarkable that these stocks shrug everything off, at some point, i don't know, investors might have to actually grapple with this. >> yeah, i mean, they might. it's not likely going to be in 2020 unless there's similar sort of issues that we saw in the 2016 election with these lar platforms by bad actors, the thing with the 230 rule here is like you said, it's going to need some sort of bipartisan legislation. i don't really think this threat from the president with the executive order from a couple of weeks ago is really going to have the impact on a twitter, let's say, than he meant to be he does not like being edited on

twitter. therefore, he wanted to roll back protections they have as a platform, not as a publisher i think jack dorsey, the ceo of twitter has kind of stood thhis ground here and said we're willing to have those protections rolled back because we're not going to have our platform used this way for all intents and purposes, twitter stock has acted well on the flip side, regulation is going to be a very meaningful head wind for companies going forward. obviously amazon has faced no shortage of issues, different than those of facebook and twitter. amazon keeps working higher. that seems to be the one name, prepandemic, during the pandemic, post-pandemic that the investor class is in universal agreement that everything is working in their favor >> tim >> yeah, dan brings up a point i'm not sure what the stocks are going to do in the short run remember, this pressure, and you're talking about, melissa, it's not just the political pressure from doj, the ftc, almost a year ago when they

teamed up and divvied up oversight on the ftc antitrust, so there is pressure, and i think there's a fair amount of political ill will, and i think this issue is a very interesting bipartisan issue i have to weigh in on that i think the irony is of course that if you frame this as trying to protect freedom of speech, you're really hindering it by harming the companies that actually give license to it, and therefore they're not going to give freedom of speech at all. i think we are all aware of elicit activity and bad actors on the internet, and i think there are certain tvrlactivities that need to be monitored. culpability is difficult to define, but back to what the stocks do, they continue to move higher, since may 29th, google, which was front and center on this, and certainly twitter was, google is up 3% in the last 13 sessions facebook, if anything, was -- we speculated, whether if they were siding with the administration or not, which of course, they

have returned in the other direction, were they going to rerate based upon it, it looks like they were i think you have to hold before you really think this is a time to wholesale sell. i think you have different reasons to sell these companies that are valuation based than this right here and now. >> joe biden has said that we should revoke section 230 of the communications decency act, and i bring this up, guy, because why is this different from the drug pricing issue during the past election when a single tweet would send the industry and the stocks in the industry just sort of reeling i mean, isn't this sort of the same this is an issue, big tech has been demonized, whether it's valid or not, by both sides of the aisle here going into this very contentious political season >> i don't think there is a difference, mel, and i think to answer your question, the only difference is the markets become somewhat desensitized to the rhetoric that goes back and forth. there was a greauise and dustin.

i believe it was called "rain man man," as i recall, may 15th was a friday, and i mention that because that was the day around the time of our show coming out. the doj, state attorney's general said they were going to come after google, blah blah blah, as tim pointed out, the stock was trading at the time, 1370 it never flinched as we went into the next week, and my suspicion is they're not going to flinch now. there's a lot of reasons to dislike facebook, and i can rattle them all off, and you got to like the stock. advertisers don't leave, and people don't leave, and that's a recipe for a stock that goes in the words of the great dennis gartman from the lower left to the upper right. >> karen >> i agree and disagree with guy. i think it is different than drug pricing because drug pricing is pretty easy to get behind for anyone, and google and facebook, i mean, they offer free products that people like to use, and so i don't think it

has the near universal, you know, disdain that drug companies that are hiking prices do so that's one difference, but in terms, i agree, it doesn't matter in the short-term these are sort of longer term issues that take time to play out and this market is the near term focused market i think i recall maybe ever. so i just don't think it will matter in the short-term, and also as we see the reopening, a little bumpier than maybe we had anticipated, faang stocks do well in that scenario. that's what i think is going on. google is my biggest position. and, you know, long facebook as well. >> and extended faang, and maybe that's the reason, for instance, apple in yesterday's session completely shrugs off the news that the eu is launching two investigations into its app store and apple pay. it doesn't matter who's going after big tech it doesn't matter what the fines

or consequences could be, there is no alternative, and then plus people want to be in the five stocks, the biggest stocks in the market >> yeah, it's kind of a funny, you know, kind of situation here these companies are such massive monopolies they have such massive motes, they have massive cash hordes. they can do whatever they want they have done a good job of trotting all over the globe, and cozying up to whoever it is they need to do to kind of keep their things in tact they kind of draw, they play the long game, with a lot of these issues that they have on the regulatory front and other parts of the world, and they end up just paying, you know, big fines, which end up being rounding errors. i feel like we have been talking about this for an awful long time if you think back to 20 years ago, microsoft had serious issues with regulatory bodies here in the u.s., that was a defining, defining situation for that company i don't think we're going to see that with any of these maga

names right now. >> for more on the story, let's bring in gene munster, always great to speak with you. do you think that the markets have it right in terms of basically shrugging off this news >> with section 230, i want to take a step back, and i think your astute panel has captured this well. these companies are the fabric of our lives, and because of that, we're just going to continue to see different edges around that regarding more legislation, people being upset, political parties being upset about what happens on all of these platforms, competitors being upset about how one company may exert some market force. so we are going to have these continual waves, and the wave we're talking about today is section 230, and the proposal is essentially to give political parties or give anyone an ability to sue a social media

company for libel, basically if there was slander or censorship that was not appropriate the bottom line with that, and sticking to the topic of today with 230, that in fact is at the core of this topic you have discussed a lot about is the impossibility of legislating truth. that cannot happen, therefore, this essentially is going to go nowhere, and that is why investors shrug it off today i like where you're going with this, the bigger topic, the more important topic, what are the other waves ahead, the bigger potential threats of break up for some of these tech companies and how should investors navigate that, which undoubtedly will be top call in the next few years. >> in your view, what is the most pressing and realistic regulatory effort to reign in big tech in your view? >> i think the one biggest risk is relative to google, and how it ties. google has 42 different products

that are tied together they have a clear monopoly in global search, and for example, how google search impacts google maps, and the impact on local businesses i think that's something that we're going to see more about. if you kind of work down the list with facebook, it's around privacy, and some data sharing, which has been, i think, addressed, and then you get to amazon, with what's happening with aws to fund the retail approach, that seems like a distant argument and last is app and will are they exerting pressure on their developers, not treating them well in terms of some of the grades. you can debate whether they have actually a market share to demand so i think to answer your question, it is individual, there's not one sweeping legislation that's going to impact all tech companies. these regulators and politicians who are looking to gain goodwill will be taking rifle shots at

these companies and i suspect with the exception of some changes that probably google will have to make, most of them will come out on the other side in this a couple of years, and i hope regulators, ultimately take a step back, and i've been a long time follower of tech i try to weigh both sides of all debates. but i think we have seen in the last few weeks, the importance of tech in terms of helping us move forward as a globe, and i hope that that gains some goodwill with regulators >> oh, you think that will make a difference a regulator who might want to go after an apple or might want to go after google and say, you know, what, i have been relying on gmail during this pandemic, oo i'm not going to go for it >> let's look at amazon and logistics and i think that there is a case that consumers view these products, if the goal of regulators is to protect consumer, i think there's a case that consumers have a greater

dependency and affection towards these products today than they did four months ago. >> good point. gene, thank you, always good to speak with you i think that's an interesting point. it's an interesting point that these politicians are spending a lot of time discussing all of these issues surrounding big tech when consumers, for the most part, depend on big tech in their every day lives, guy >> yeah. 100% and let's not dance around this. i think, without being political, this is 100% political. i don't think there's any other way to address it. i'll say this about google my push back is google is not a monopoly the yankees aren't a monopoly. there are dozens of teams that play major league baseball, the yankees do it better than anyone else and the same thing with google there are a lot of search engines. google is the cream of the crop, and you can call it monopoly, i don't think it's a monopoly in the true sense of the word, mel.

>> tim, quickly. >> yeah, they haven't done it better in major league baseball in how long, ten years i think i understand your m metaphor. >> coming up, her chair is getting, what the company did in response to regulator push back. t.d a new season of fortnite is ou what does this mean for the gaming trade, all that and more coming up on "fast money." ♪ the covid-19 pandemic is creating food insecurity on a scale not seen in decades.

an estimated 54 million americans will struggle with hunger. ♪ with 200 food banks and 60,000 meal programs, feeding america is the largest hunger-relief organization in the country. join morgan stanley in supporting feeding america and your local community food bank. ♪

welcome back to "fast money," hertz scraping plans chairman jay clayton said earlier today on "squawk on the street." >> this particular situation, we have let the company know that

we have comments on their disclosure in most cases when you let a company know that the s.e.c. has comments on their disclosure, they do not go forward until those comments are resolved. there are other processes here that companies have to follow, including if the shares are going to be listed, meaning continuing listing requirements for those shares, and there are professionals involved. >> hertz has seen massive interest from retail investors shares jump when the latest news came out is there any reason here, karen, to take a look i mean, this whole story is absolutely crazy, i think. >> the whole story is absolutely crazy. i mean, i don't know, i sort of feel like good for hertz for giving it a go it was a creative way to think about how to bolster the balance sheet. one thing that was interesting

that clay said from the ak that, hertz said this afternoon. it sounded to me like they started selling shares normally they don't go ahead with it, until the s.e.c. comments and in the 8 k, they said they have suspended, so they might have already done some, which i don't think really changes the story dramatically, but it's sort of interesting it's just, you know, i can't understand the whole thing you have to really believe that this is going to -- this business is going to turn around dramatically, before they get out of bankruptcy, and the stock is going to have some equity, and have some equity value what's going on is totally unrelated to that, this trading, it's absurd, if you look at genius brands or a bunch of others, i mean, you know, we talked about it with dave a lot. this is just a ridiculous game >> if you read the filing, if you read the s.e.c. filing on hertz, in the stock options, they may be delisted the caveats on the stock sale

are numerous, and yet it looked like people were willing to go in, tim. >> well, if a bankrupt company can sell stock, they will, and this gets to the overall environment. they can't deceive the public, and their disclosures have to be accurate diskr disclaimers and caveats aside, the facts on the cash and the obligations of which there are many, and again, we have started to see through some of their filings, that ak gives a lotof information, they're behind on payments from abs, there's a lot to do and an equity offering is not going to solve that. here's another stock, pairing gains from earlier in the day after reports that its founder trevor milton exaggerated claims that the truck was drivable according to the report, the truck was missing key components including a fuel cell. a spokesperson for the company telling cnbc milton quote never

deceived anyone. he was showing a demo prototype inside a warehouse parts were removed for safety. nothing was exaggerated. shares had been up as much as 9% earlier nz din the day guy, you know, i think this is interesting. this is sort of a trust, we're working to change the world, trust me, we're going to have this product out at a certain time, and when you hear a report like this, it sort of makes you think, i don't know. >> yeah, but what does this remind you of, mel five years ago, this same probably conversations we're having about tesla, quite frankly, so it's just this year apparently potentially that type of story, but, you know, the two conversations we had, hertz speaks to basically what jeremy grantham was speaking to at large in the amazing interview at the end of the day. you should go back and listen to it if you have it.

he's speaking to some of the things we have been talking about for a while, and if you done, you know, if you think i'm a fool, which a lot of people do correctly, by the way, you should listen to what he says, because he's echoing a lot of the same things we have been saying now for the last couple of months. so this is clearly a buyer beware environment, and to the earlier point about hertz, karen breaks this down perfectly, but she would acknowledge, this comes down to a greater theory thing, hoping somebody buys it at a dollar and a half, and so and so on. that worked well for the lot of people. >> and of course we had trevor milton, the founder of nicola on fast money earlier this week, tim i don't know what you make of the company itself >> the model is different than tesla on some level, and obviously the fuel cells are a different approach the fact that they are outsourcing their production, the fact that they are teaming up in commercial right away, so not apples and oranges, but a

different approach, and different innovation and it's very exciting, what do you pay for it, not this, you know, not what the stock is valued at now. bad news for the banks, markets are betting on major dividend cuts. should you ring the register on these names? we'll have the report in the trade straight ahead, but first, the megarally taking a pause today. one top strategist said tc out below, more downside is coming we've got them next. or the everyday drive. today, that philosophy extends to how we connect with you. we call it, audi at your door. whether a remote test drive, shopping, trade-in, or even service pickup, audi at your door can do this and more at participating dealers. the premium audi dealership experience, on your terms. audi at your door.

woi felt completely helpless.hed online. my entire career and business were in jeopardy. i called reputation defender. vo: take control of your online reputation. get your free reputation report card at reputationdefender.com. find out your online reputation today and let the experts help you repair it. woman: they were able to restore my good name. vo: visit reputationdefender.com or call 1-877-866-8555. i know that every time that i suit up, there is a chance that that's the last time.

300 miles an hour, thats where i feel normal. i might be crazy but i'm not stupid. having an annuity tells me that i'm protected. during turbulent times, consider protected lifetime income from an annuity as part of your retirement plan. this can help you cover your essential monthly expenses. learn more at protectedincome.org . until we have a vaccine, what we have seen in other markets, the consumer is still going to be concerned about safety they're going to be making kind of this unconscious cost benefit tradeoff

we need a vaccine, certainly our expectation, though is that a vaccine is probably, you know, call it 12 to 18 months away >> welcome back to fast money, that was mcdonald ceo chris on mad money raising concerns about getting fully back to business until a covid vaccine comes out. here's a question, does that 12 to 18 months matter as long as the fed is in play chair jerome powell saying the fed will keep its foot on the gas until it is clear that the economy is on the mend why can't we just get on board here, guy, and ride this train we know the fed is going to do everything in its power, use its entire balance sheet to keep this economy going, until we get that vaccine out in which time business will pick up. >> yeah, listen, that's fair, and it's made a lot of people a lot of money tim has correctly said, you know, don't make this more complicated than it has to be. the pain trade is higher, a lot of people, a lot smarter than i am say don't fight the fed it all makes sense

it shouldn't be that simple. there has to be some ramifications, and we're 12 years into this, so i wonder aloud at what point do we hit the point of diminishing marginal returns now, clearly i thought it was a while ago, but i think we're headed there the fed can only do so much, and you know, at some point, the market is going to call bs on them, and i'll point this out as well if the dollar has some precipitous drop, which i'm not suggesting we're at the precipice of it certainly appears there's been a c change, that's not bullish for equities in my opinion, despite what history might say. >> the fed could be the biggest risk to stocks and the broader economy could be sven henrich, speaks to us on the phone. why is the fed in danger, and

when will we siee that point in time >> the fed has created an acid bubble the lender of last resort is the lender of entire resort, and no red line shall remain uncrossed. the fed has created a gambling casino at this point, and all of the gamblers have moved in from my perspective, the danger is the fed is overdoing it, and defying the economy, they're in the process of inserting ever deeper into markets and if that makes the fed itself becoming too big to fail, and the fed losing control over the acid bubble is now the biggest risk factor to the economy. remember, allen greenspan mentioned if markets drop 10%, that affects gdp by 1% we have a massive rally which could be a bear rally. prices have reached levels we have rarely seen let me give you two examples

here specifically, one is market caps at gdp guy has mentioned this on the show before. there have been two periods in history where markets exceeded or disconnected so far from the economy that it's reached the level of 150% and higher one of those areas, times, was the nasdaq bubble in 2000, and the other one, ironically, was the february 2020 topic, because obviously the fed hadalready printed significant sums of money in 2019 with the operation. so we ran into this covid crisis, massively extended from an economic perspective, and so now we are here now, and this is really fascinating, last week, we actually hit 152% market cap to gdp, and just to put this in perspective, typically what you see inside of a recession is that there's a discounting process for assets, and actually in 2000, 2007, we dropped to 50%

to 75% market caps gdp, to be inside a recession and these extreme market valuations we have never seen before the fed managed to do something unprecedented. manufacture the first acid bubble inside a recession. >> dan, you have a question. >> sven, let's just say the fed is this bridge to a vaccine, that's how we started this conversation you know, i guess barring some horrific second wave of the virus, and some really bad news as far as the pace of a vaccine or therapies, what do you think the downside is? i mean, the fed told us this week with the corporate bond buying, they're just going to keep pulling things out, and i'm kind of like, you know, shrugging emoji here you know, so for me, worst case scenario, i see 2,600 downside, the s&p 500 in a bear market here >> yeah, i don't disagree with that you know, we're not going to see a massive crash like we saw in

march. there's too much liquidity in the system, but we are definitely open for sizable corrections here in the next few months especially if we do not get the type of v shaped recovery that i think a lot of people are at the moment presuming and the valuation risk is so high and the multiple expansion risk is so high. what i want to point to is that in the last three years, really, in terms of the market repeat the same patterns over and over again, which is all rallies have come on either monetary or fiscal expansion, and all market drops have come at the point when basically fundamentals have reasserted themselves, and you know, let's face it, the big picture here is that the market moves have become ever more extreme. the rallies to the upside as well as on the downside. last week was a good example, right, because all of a sudden there was a quick drop of 10%, 15% on the small crafts, for

example, in just four days why? because these markets are building these compression patterns on the vics and the rallies are steep. the gaps never fill in many sessions, but technically they want to revert and fill those gaps, and for that reason, actually, knowing there's so many gaps below 2,700, all the way down to 23, 2,400 is a lot of open space from a technical perspective. >> sven, it's always great to speak with you we hope you'll come on again soon i'm sure this is a conversation that will continue sven henrich, of north man trader group karen, what do you think >> definitely the feds, that has been driving the market, of course, we know that but it's interesting, powell says over and over and over again, he needs additional help, right, he wants fiscal stimulus as well. and i think we'll get that, which will just allow this sort of bridge to be built out a

little longerment i don't kn i don't know if it gets us all the way over the kcasm of what covid-19 causes, but i think there's kind of a floor. i don't know that it's at the money floor. this kind of market, i find it very difficult, and i don't find things that i really want to buy. >> coming up, calling all fortnite fans, what latest season of the black night game means for creator. and guy pitches his top stock idea, big games ahead or will he get ghosted. he'll take the mound more "fast money" in two ♪ ♪

welcome back to "fast money," the dow and s&p 500 snapping the three-day win

streak there was a bright spot in the action that caught guy adami's eye. he's fired up to do his fast pitch. what are you looking at? >> i love the power pitch. it's one of my favorite bits we do on cnbc's fast money, and my power pitch is snap. kudos to dan nathan who was on this long ago and as was 386 bullish on the name and i have gotten on back of it you go back to the fall of 2017, this stock topped out around $21 or so. technically, it appears as though we're breaking out through the old prior high, number one number two, partnership with zing it. don't underestimate it i'm not a gamer, and a lot of people are that's really important to the story, and that's one of the tail winds they have gotten and the third one is they have really pdated the developers

app and opened it up in a very apple like way now, mention this, snap was sort of left for dead facebook was sort of leaning on them in a major way, if you go back to when this was a $7 item. it appears as though facebook was going to really put the death nail on them, and they have gotten off the mat, and look at them now i think facebook has taken their eye off snap, much to snap's pleasure, i'm sure and this is a name that i think is just going to surprise a lot of people to the up side for those three reasons and probably many more, i think snapchat goes higher from here >> does anybody have any questions for guy concerning his pitch or any other topic they choose dan? >> yeah, guy, when's the last time you snapped, buddy? >> you know, it's an excellent question by you. for example, i have never bought anything on the amazon, but it doesn't mean i can't be bullish

on a stock, and i don't have a snapchat application, though when the application stores reopen, i plan on going personally i heard some of these apple stores have reopened, so maybe i'll get on the line. >> this is definitely not a peter lynch sort of style fast pitch. >> no. >> far from it. >> this is not any of the lynches, no. let's see how traders are voting tim seymour, what do you say >> i learned this trick on a zoom covid call, you're snapping people in, and it's usually good news i'm actually going oh, snap, i'm actually a seller, and i'm sorry, guy, i agree with the addressable market, and the engagement has been extraordinary, i hate the 180% move, and that's mostly my reason for negativity. get them next time clubber. >> karen >> yeah, i don't know if you can see this it's not very creative, but i'm going to pass, and the reason kind of echoing tim, it's the

giant move, and i'd rather be with evan spiegel's evil nemesis, zuckerberg on facebook. >> dan >> i'm also passing here you know, guy is also very generous with his accolades, you know, snap, i think, probably the last time i was bullish on it was in the low teens or something. it wasn't hard to be bullish on it down there with like a $14 billion enterprise value up here, now, it's a little different story here, so i give you a lot of credit, you're playing the momentum my biggest worry about snap is ti tictoc, and it's got massive momentum in the u.s. we know they hired disney's former head of streaming to run their u.s. operations. this is going to be a force to be reckoned with snap in the near term. to me, i'm a seller of snap here near 22 bucks. >> on the desk, no buyers for guy. poor guy but will you out there vote for guy's fast pitch on snap

vote on our twitter pole on fast none before the results a new funding on the way for ec mepigas, how much is the fortnite creator worth. fast knight is bamoney is back s get zero percent financing and make no payments for up to 90 days on all 2020 lexus models. experience amazing at your lexus dealer.

can i find an investment firm with a truly long-term view that's been through multiple market cycles for over 85 years? with capital group, i can. talk to your financial professional or consultant for investment risks and information. talk to your financial professional or consultant there are times when our need to connect really matters. to keep customers and employees in the know. to keep business moving. comcast business is prepared for times like these. powered by the nation's largest gig-speed network. to help give you the speed, reliability, and security you need. tools to manage your business from any device, anywhere. and a team of experts - here for you 24/7.

we've always believed in the power of working together. that's why, when every connection counts... you can count on us. welcome back to "fast money," another season for fortnite's battle royal mode, the game's creator epic is close to securing a massive funding round. josh lipton has all the details. hey, josh. >> melissa, it's the moment fortnite fans have been waiting for, a new season officially launching today. that means players can now drop into this partially flooded island where they can hop on water sky skis, hitch a ride,

form knight remains a force, one of the most popular video games ever made. now with 350 million registered players. in april alone, epic games, its publisher said players spent more than, get this, 3 billion hours inside the game. tim sweeney founded epic games in his parents' basement in 1991 with just $4,000 in personal savings. beyond fortnite, the company today is well known for its house party app, which allows users to video chat with friends and family, and unreal engine, popular software that developers use to build games reportedly epic is now close to raising $750 million of funding at a valuation of about 17 billion. but the company we know also does have competition from other free-to-play battle royal games, like war zone, and ea's apex legends, investors have piled into the names, both up 20% this year, far outperforming the

broader narcot broader market. >> that's stunning to go from $4,000 to a $17 billion valuation possibly >> yeah, so mel, this company, though, you know, guys like guy have no idea what's going on, house party, fortnite, this is all over his head here, you know, in april, this company had a rap concert in their app that attracted 27 million people at one given time i mean, you just can't get those numbers anywhere else like that so there's multiple different ways they're attracting consumers, mump like we just talked about tictoc doing something differently, and taking a bunch of screen time from the traditional apps i think fortnite is here to stay, and they're going to keep innovating 17 1/2 billion dollars valuation seems probably on the light side given the trajectory of the company. >> tim is this a threat to the other competitors, or impa

valuation that some of the other companies -- >> mobile gaming is on fire. 17 billion valuation 10 cent owns 40% of epic games, a great deal for them. a great gaming company ea, apex legends, i kind of like that one i think the valuations in the space are interesting. they got destroyed about a year and a half ago we're in an effectively year and a half breakout and the numbers and valuation, around 25 times, these guys, many of them, these companies should be targets for media companies that have flagging at least content, and needs that i think they can deliver in this interactive environment, so stay in the sector, this is good news for the sector. >> i mean, if you can host a concert within one of these games that attracts that and really makes you think, especially in this pandemic time, how event creators can rethink their businesses

>> yeah, i mean, as someone who owns live nation, you know, hopefully they don't get recreated out of their business. i think ultimately that business will come back i agree with tim, and i thought these have been a potential target for media companies for a long time. with the post covid valuation, i guess, i don't know, readjusted a lot higher, and what's happening to media companies, the reverse if they're maybe now too expensive. >> guy, you get the last word to respond to the remarks that dan made about you . >> a few things. josh lipton gets better looking every time he comes on i can't even see him he just exudes it through the screen number one. number two, i don't know how to spell umbrage, but i take it with dan because i was one of the 27 million people at that concert, and yes, it was warm, and that was pre-social distancing, number two, and number three, we have mentioned on a number of occasions, take

two interactive, comes out ttwo moving to the up side, and that is now within a whisper of its all time high, so despite my age, i like the space. >> coming up, big banks may be gearing up for something that hasn't happened since the financial crisis we'll tell you what it is, and one key name traders are eyein , and the ceos of union pacific and next door igweh in on their companies 6:00 p.m. eastern time more "fast money" after this america's fastest network for iphones. second tip: you can put googly eyes on your stuff to keep yourself company. uh for example, that's heraldo. he's my best friend. oh, sorry nancy, i forgot you were there. get the amazing iphone 11 for half-off on at&t, america's fastest network for iphones.

can i find an investment firm with a truly long-term view that's been through multiple market cycles for over 85 years? with capital group, i can. talk to your financial professional or consultant for investment risks and information.

welcome back to fast money, stress has hit the banks a week from tomorrow, and there could be big changes in store for the big banks. u.s. banks paid out a combined $32.7 billion in dividends in the first quarter or almost double the profits they earned options traders are betting that won't be the case for much longer cnbc.com's found jp morgan's dividend in particular may be on the chopping block what are traders telling you >> so traders are nearly telling me what they are observing in the markets, and if you look at the options market, and you look at jp morgan, the options imply a 33% cut to their dividends by january, and as you know, jp morgan has served the best in

class, you know, they had a record year in earnings last year, and so this is something that's kind of remarkable to me, there's this distance between the expectations and, you know, if you talk to the sofi bank analyst, particularly jp morgan, everybody is relatively confident they're all going to pass the stress test with the exception of wells fargo. >> i'm going to bring karen into the conversation this also is completely discordant with what jamie diamond himself has said about the dividend >> right, i mean, he talked about, you know, cutting the repurchases was a much bigger deal than the dividend, which i think he called it sort of a drop in the bucket i would be surprised from what they have said so far, unless this quarter is just so much more, i mean, unless the provisions are going to be so much bigger than they thought when they announced in april, i would be surprised if they cut their dividend, actually i mean, stranger things have obviously happened wells fargo, they really should

be thinking about it it's 7 1/2% yield, they're just not getting the benefit. that yield is ridiculously high. >> yeah, dan, what would you make of this sort of action. is there another way to explain it >> there's no other way to explain it other than the fact it would be a cataclysmic event in bank stocks in 2020, if jp morgan were to cut their dividend, especially when you consider, we keep hearing again and again that the banks are not the sources of this crisis, their loan loss reserves are in good state, the valuations are very reasonable. i think it's important to remember that jp morgan does not act well it is down 28% on the year, the s&p is down 3%, it is telling you about back half of the year abrupt bankruptcies, that they will b ticking higher and, that's what the implied dividend cut is also telling you. i keep saying this, i'm getting whipped around with the trade in the banks but they're telling

you something, telling you the same thing about the crowding in the megatap names and the speculation in the bankruptcy names, and the day trading stuff, all telling you that things are not exactly sound right now, and so i don't know, the s&p 500 down 3% on the year given this pandemic that we're in, given this economic crisis, something smells really bad here, i'm not talking about a crash, but i'm saying that the equity market is divorced from the economic reality we're facing and jp morgan and the implied dividend cut said a whole lot more about it than the maga stocks. >> every single bank, aside from maybe one to pass a fed stress test with flying colors. >> that is the default expectation. i think it's important to bring this out here. the x factor here is the federal reserve. these are the guys who are running the exams and nobody knows how tough the fed will be. you had, you know, you had some recent competements to talk abon

increase in potential scrutiny tied to covid, and as you know, there are so many millions of americans who are in some kind of loan fore bebearance, you hae the fed stress being an x factor, so the first time they're implementing called the stress capital buffer which is another x factor, so more than anytime since probably, you know, 2011 or so, there is this wide range of outcomes that you just don't know what's going to happen, and i think that's represented in a lot of the activity in the market right now. >> hugh, this is fascinating, thank you so much for bringing it to us you can read that article on what the fed stress test might mean for banks head to cnbc.com for the write occupy jp morgan isn't the only bank they're trading in mike khouw has the action hey, mike. >> i think there's interesting things in the article.

i read it myself the options markets can tell us a lot about what the dividends are forecasting going well out in time. look out to january of 2022 to get a sense of what the options markets are implying for dif dividends, it's not just the stress test that might be the reason for that. when you see bank earnings decline, that might be a reason dividends could be in jeopardy some of the options trades we're seeing today, including ones in wells fargo, arguably one of the stressed, we saw outpacing by two to one some with the short dated call buying, the july 2nd, weekly, 31 strike calls that's thursday, going to be two weeks from thursday, because of course we're going to have friday off as a result of the july 4th holiday someone was buying those calls, paying a little over 50 cents for 620 of them. that trader might be speculating that the news comes out of the stress test a little bit better than expected and you might get a short-term pop that's not a play necessarily that the dividends won't be cut.

it is a play that you could see a short-term pop after we get the results. >> thanks for that, mike pulse action, 5:30, getting back to the x factor of whether or not people who are in forbearance will go back to paying those loans, that's an interesting factor to throw in there. we're having the stress test at a period where things are okay now. because they're in forbearance but in a month it might be a different story. >> much different store, mel, and again, remember, you know, you wonder what company, they're not saying it, but you wonder what the landscape is going to look like employment-wise six months from now. i'm not that optimistic. >> up next, we are down to the last few minutes before we reveal the results of our fast pitch poll is america buying guys pitch on tnkoueverybody on the desk said noha y stick around to find out ♪

♪ ♪ ♪ ♪ try nature's bounty sleep3, a unique tri-layer supplement that calms you, helps you fall asleep faster and stay asleep longer great sleep comes naturally with sleep3. only from nature's bounty.

cool? drop the taco. get in the car. does this sentra feel like a compromise to you? wait, what...? the handling is good, right? no compromise there. nope! watch this... umm... b-brie...brie brie! rear automatic braking. so if this nissan sentra isn't gonna compromise, why should you? you're right! atta girl. the all-new nissan sentra. with more standard safety features than any other car in its class.

welcome back, time to reveal the results for guy's fast pitch. it ain't pretty. 70% of america said no there you have it toni braxton time for the final trade, tim seymour. >> and the dance version, too, means it was extra bad pfizer, extra good, the chart was difficult, valuation very interesting. >> karen >> yes, can we take the other side of the dan trade so i don't get to fight with him as much as we normally do short with the tlt with the fed printing money we could see inflation at some point. >> dan >> at son-in-law point, long the tlt, short the xrt >> guy

>> snap suckers. >> thank you for watching "fast money" we'll see you back here tomorrow at five anmemad 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 welcome to "mad money. welcome to cramerica other people want to make friends, i'm trying to make you money. call me 800-743-cnbc or tweet m me