look at the lower income and even the medium income segments, they're cutting back on their discretionary spending the higher end consumer is spending quite robustly, but almost 2/3 of them are starting to feel the pinch. they're starting to take on more debt we have to be prepared for all economic cycles. back to you. >> all right, kate appreciate it. that will do it for "overtime. "fast money" begins right now. right now in "fast," great shock. the day after the fed's latest move, climbs from mortgages to car loans are rocketing higher how hard is this rapid rise for consumers and businesses to handle plus, unlucky seven and a bruised apple. amazon's losing streak at seven days the e-commerce giant down more than 20% during the slide, and apple getting hit again. but chart master is here to tell us why he thinks the iphone maker is going to keep pushing lower. and later, a venti-sized flood of earnings action,

starbucks, amgen, block and more i'm melissa lee. this is "fast money. we're live at the nasdaq market site tim seymour, steve grasso, guy adami, and the chart master himself with his very large keyboard, carter braxton he has a large keyboard. i'm speaking literally all right. we start with another spike higher in the interest rates the yield on two-year treasuries jumping to more than 4.7% for the first time since july 2007 also climbing hitting more than 4 1/4% the moves coming after the fed raised interest rates. target rate another 75 basis points and suggested it might not stop any time soon higher rates already had a huge impact on consumers' borrowing costs. since the central bank first started hiking in march, the home equity line of credit has risen by 300 basis points. 30-year fixedmortgages climbed to more than 7%. autos have also climbed. meantime, the s&p 500 has dropped by more than 10%

so how will this all change how companies operate in this environment, and what will it mean near stocks guy, what do you think >> margins, number one it hurts, without question and really in terms of what we try do each night, and tim talks about this all the time, what are you willing to pay in a rising interest rate environment. you say wait a second, we've been 4.5, 5% before. it shouldn't be a big deal it's the rate of change that is the big deal number one. 25 basis points seemingly a year and a half ago that's significant and then servicing the debt on these things it's a multion s&p 500 earnings, earnings that are going down almost by definition because they have to so what's the right multiple in this environment i would submit, and i'm not saying i'm right, 15, 15.5 in this environment makes sense off of 200, $210 in earnings you can start doing that math. the right price for the s&p should be between 3200 and 2400. >> for all the consumers out there who got their auto loans, who pay off their credit card

balances, who got their mortgages a year or so ago, good for you. but all the rest of you folk out there, you're being subject right now to a steep rate environment, tim and that's going hurt. >> it's going to hurt. the good news, though, is for folks that your cash is actually worth something. for investors out there, you need to be pushing, and cash management should be an everyday exercise for people looking to see where they're earning nothing on their money, push your banks around, get yourself into three and six-month t-bills even if you're just doing cash management if you get back 20 where the fed is, where the fed was yesterday, it's not how fast. it's how far and so if you look at what happened in interest rates over the last couple of days, that two-year went from 443 to 471 in essentially one session. but you look at what happened to the fed fund futures curve, and you don't have to be -- again, you can find this information, but what really is happening is the peak of fed fund futures went from april out to july. it was 475 a week ago. it's now out to 515. so you're getting some sense of where we are i think you get back to a couple

of things. the fed, they're 2% inflation target ain't happening any time soon and there is flee or four reasons why. we talk about the depth of globalization. we talk about the stickiness of the housing market health care costs continue to go higher these are things that you have to think about but it comes back to the market. what sectors do you want to own in this environment? and banks, by the way, have the best exposure to real rates, and they've been outperforming since their earnings and i would go back to energy. in an inflationary environment, the energy sector is outperforming and will continue to outperform. >> carter? >> the thing about banks, if you really are going to go into a slowdown, the long lost provisions, and they haven't taken measures for that. it is a lick cal glare one thing important about the market, and guy, you mentioned this, it's the valuations. a tough thing. do you get a trough multiple on trough earnings? that's the rarity, right are we really going to get a 14 multiple on a 20% declined earnings then you're going into the high 2900s.

i suspect it is closer to a 3100 but the main thing what is the premise to be really bullish here it doesn't carry water >> not only higher, but longer this higher rate will be with us for longer so how do you project that on to a multiple market? >> the market always six to eight months ahead any way so you're going to see the drop in the market. you're going to see the buying opportunity before we're actually out of the woods of a recession any way. but when you led off the show, 3.5%, 30-year in february. 7% now over 7%. >> yeah. >> why hasn't housing adjusted more >> lack of supply. people aren't moving >> or tip of the iceberg still right. and what is the fed looking to do crush demand we haven't got to crush and in yet because housing hasn't responded in an adequate fashion yet. so there is more to come. >> well, that's the bad news. >> right. >> more to come. by the way. >> yes. >> i saw you on the "today" show today, which is amazing.

you crushed it and you mentioned exactly that what's changed is it's going to be longer duration i don't think the market was expecting that, which is why we saw the precipitous decline we saw yesterday and probably will continue to see. with that said, steve exactly right. they're trying to crush demand, which makes tomorrow's jobs number extraordinarily important, because if you get a good job number in terms of things haven't gotten deteriorated on the jobs front, that really makes a difficult job for them that much more difficult. >> and let's give dan credit >> dan nathan. >> dan nathan. powell got a first look at that report and not that he -- maybe it was in the interview process he can parse his words. obviously the written process of the fed meeting was already done long before that but it's probably going to be a pretty good number tomorrow. >> we get two jobs reports before the next fed meeting. so that sort of complicates things if you think we're going to get any answers based on tomorrow's

report, we've got that we've got another one, a cpi report there is a lot of data still to come. >> the worst thing that could have happened is we bounced so much the october 13th low, we went up almost 12, 13% if we had gone down 12, 13%, we could be almost done with this we would be at close to 3,000. and then the fed, and they are watching stock prices. we know stock prices are in the leading indicator index, hey, w can be a little tougher. >> how can we be done with this? i'm not saying we should be. but when you think about the apples of the world, and you're going to show some interesting charts later in the show that may upset that table apple hasn't given us a demand warning. we haven't heard from a lot of the mega cap tech stocks even though wit australia tough week. this is an environment that that labor market that we're talking about, it's going to be sticky there are not qualified people for most jobs out there, and we're going to be like that until we get north of 5% on the unemployment rate. if you want to talk about where the market has to finally begin to settle with realities, we're

six to nine to 12 months away. scary statement out of the boe this morning this is the bank of england. not our central bank they were the one central bank that went out there and said you know what? we're going to have a recession in the second half of 2022. >> a very bad one. and that's why peak rates might not be as high as you think they will be. >> by the way, we're going to have one in '23 and probably be into '24 there is going to be a lot of people going to the pubs, hanging out. it's painting that kind of a picture which shows you the duration may be the word of the day. we're not getting through this quickly. it doesn't mean that you can't have these enormous trading raerls. >> for more on the impact of rising rates on corporate debts, let's bring in chris white ceo of bond click. chris, always great to get your take just keying off of this notion of higher for longer, how much characteristics do you think that poses, particularly to companies who have gotten bbb ratings and may be in jeopardy of following below investment

grade? >> well, it's great to be back and i think that credit is definitely going to be in a lot of people's minds for the foreseeable future, because the actions of the fed are going to have a direct impact on anyone who is holding corporate debt out there, and for a lot of the big corporate debt issuers what we've seen over the past six or seven years is just monstrous growth in overall corporate borrowing with the bbb sector growing to be about 50% of the outstanding debt in the u.s. corporate bond market now as levels are rising, and powell and the fed keeps indicating that they're going to be lifting rates into the near future, we have to start looking at companies differently we have to start looking at whether or not these companies are going to be able to refinance themselves without being down gridded >> the other side to this is that a lot of investors have bought these bbb-rated companies because the yields are so much higher so they are also at risk in terms of having to purge these from a portfolio and that could really create a vicious cycle. >> yeah. to walk you through the steps

here, and that is something that i don't know whether the fed is really looking at this, but, you know, the interest rate environment is definitely directly controlled by their actions. but then the market does have some influence over it so with this -- with what you've just described, if a bbb rated company needs to refinance and they're finding that the rates to refinance are a lot higher and it starts to kick them into high yield territory in terms of being downgraded, i think we have data regarding credit suites credit suites has about $35 billion in debt outstanding that has to be retired or is going to mature in the next five years. so when you look at what's happening with credit suites just as a name in the marketplace, they're a little bit of trouble they were just downgraded to a notch above high yield by s&p. so now looking at the forward forecast, what can credit suites expect in terms of interest rates they're going have to pay to refinance that debt it could kick them into high

yield territory which would mean all credit suite bonds would have to be purged out of investment bond grade portfolios >> chris, if you can educate me and all of us here actually in terms of corporateaaa rated investment grade debt, the best corporate debt out there, even that has suffered terribly this year so even a portfolio of the haiti highest rated, biggest companies in the united states, they've lost what, a third of their value or so in this past year. are there holders of this debt that will have to somehow do something because they're forced to mark to market these losses >> this is actually -- i heard a little bit earlier before i came on you were talking about duration risk. i think that duration risk is going to be the leading topic of 2023 mainly because you have high quality corporate credit names that are losing massive value on their bonds. and what happened here was we talk about the reach for yield that occurred with people that may be investing in bbb rated

debt there is definitely some risk there now as those companies may be in trouble. but also, highly rated companies, companies that you don't worry about like a company like apple, for example. they have a ton of paper out there. and what apple did was they issued a lot of long-dated debt that had low coupons so now as the fed starts raising rates, that debt must be repriced much lower in order for to it match what current market rates are. so what we're seeing, and there was an excellent article written by tracy allway from bloomberg, she wrote a piece if you had a million dollar portfolio filled with investment grade bonds, all the great names, apple, oracle, jp morgan, that portfolio is now priced at about 650,000 in the market today so as powell talks about going higher and for longer, where does that portfolio go you could have an investment grade portfolio with high quality names going below 50 cents on the dollar if it's going to match current interest rates. >> chris, we mentioned the fed put -- carter said they watch.

i agree. it's probably much lower than we are now. i would submit below 3,000 but credit, and credit concern, the credit market is something that has to be in their purview, has not grown, but there are glimpses what do you watch? we talk about the hyg, the lqd is there something at home people should be watching to give an indication that something is happening in the credit markets >> well, it depends on what you're looking at. if you're looking at a portfolio where you're taking on a bunch of duration risk, there is really not much you can do through here you're going to have to ride this out, because to sell is probably the worst thing you can do it's just these bonds are now matching the current interest rate environment, and you can't really protect yourself. but i think that what really the feds should be watch watching, what's going to happen when a lot of these bbb rated companies have to refinance? if they're refinancing at much, much higher rates, this really puts them in a position in which they're going to be downgraded if they're downgraded, then the raising of rates is going to not

be done by the fed it's going to be done by that onslaught of cheap credit that's going to be available in the marketplace which then creates even larger problems for other issuers because they're going to have to offer really attractive interest rates to attract any sort of investors. so there could be a domino effect here. and you say the fed's looking at the equities market. i think one of the biggest problems with just whether it's fed policy or whether it's any sort of governmental policy is there is actually not enough good clean data in the corporate bond market for you to be able to make a definitive objective statement about what's happening here and now this market is 10 trillion in outstanding size i think it absolutely needs to be addressed in a way in which credit and what you could be doing to the corporate bond markets needs to be factored into a lot of these frank conversations. >> chris, it's always great to get your unsights. we appreciate it. >> thank you >> tim >> we talked often about that bbb minus tranche on a downgrade and what goes. we look every day at the high-yield spreads investors can do that.

you can log into bank of america, high yield oas spreads and get a sense where we are relative to history. glass half full for a second i think for investors right now this is an incredible opportunity where the credit markets can offer equity-like returns if you're moving up the credit quality and you watch your duration. and if you look at some of these companies, you can get 10, 11% and very, very high grade companies and opportunities that you haven't had for a long time. so for a lot of investors out there, it's a scary time it's also an opportunity we're putting cash to work on the credit side and fixed income is a great opportunity >> all right coming up, a number of big names on the move in the after hours session. starbucks, am, block, paypal, coinbase plus, netflix rolling out basic with ads plan. will it help subscriptions take off? we have the tas enfadeilwh "st money" returns back in two.

well, we fell in love through gaming. but now the internet lags and it throws the whole thing off. when did you first discover this lag? i signed us up for t-mobile home internet. ugh! but, we found other interests. i guess we have. [both] finch! let's go! oh yeah! it's not the same. what could you do to solve the problem? we could get xfinity? that's actually super adult of you to suggest. i can't wait to squad up. i love it when you talk nerdy to me.

guy, guys, guys, we're still in session. and i don't know what the heck you're talking about. welcome back to "fast money. starbucks shares rising after the company said u.s. customers spent more on their orders in this latest quarter. the earnings just kicked off at the top of the hour. pippa stevens has been listening in >> the call under way. the key is 2023 guidance

nothing on that quite yet. but we did just learn incoming ceo lakshman narasimhan, the first time we're hearing from him after starbucks outlined a reinvention plan in november they jumped 7%, which was well ahead of expectations. much of that was thanks to an increase in a ticket, as well as a slight uptick in u.s. traffic. china, though, weighing on international same-store sales, which were down 5% overall and 16% in the country due to ongoing covid restrictions but that is actually an improvement from the third quarter when china's same-store sales dropped 44%. and don't miss starbucks rachel ruggeri tomorrow morning on "squawk box. >> pippa, thank you. tim, you own this one? >> i do. merry christmas to starbucks we went early this year on the christmas cups >> like the red. >> the red, mariah carey it's fun now it's not going to be fun in a month when you're still hearing that song. >> they'll be on easter then

>> for starbucks, part of it was u.s. same-store sales up 11.2% what i thought was the most impressive, though, is they're actually giving you a 15 to 20% eps guide over the next three years. this is a company that hasn't been able to get that. this is a company, and that is where i worry. they've been able to pass all of this pricing on to the u.s. consumer, and the u.s. consumer, they bought. they bought and they bought, and they said higher ticket sizes, loyalty programs that continue to grow. when you're loyal, you're loyal to starbucks i'm arraigned in that court. i worry that there is a limit. if this consumer gets downgraded that last block, when that consumer is starting to feel it in other places, at some point they're not spending six bucks on that latte. not even guy >> api on your credit card and an auto payment that is bigger than your mortgage or whatever terrible >> one thing about, it's not unique to starbucks in the sense that the restaurant group, for you look over the last three months, 400 mid cap restaurants, they're up 10% the market is flat and year to date, they're down half as much as the market you have cheesecake on the move,

dri, yum it goes on and on. i think it's a fantastic instance of a bearish to bullish reversal >> the main headwind, though, is china. so china, they have 6,000 stores they're trying to go to 9,000 stores by 2025 that really hinges, that's the growth segment so i'm not sure how many $6 lattes is going to keep the growth story going. >> how long have you been going with the soy milk -- is it almond miglk >> what you doing? >> frappuccino. >> everybody done? >> with the caramel. >> no is the answer. i don't like starbucks coffee. as a matter of fact, i think it's miserable i get the medicine ball. yes, i use that. medicine ball by the way has lovely peach in it it's fantastic i'll say this quickly. >> what are you talking about? >> look it up. go to your google machine. >> costs more than $10 >> 25 times next year's numbers, a lot of the good news is baked in. >> yes. >> i'll say, though, if china does reopen, 25 times is actually pretty cheap. >> yeah. it's 17% of its revenues, china.

snooech. amgen, the biotech giant narrowing its outlook kristina >> beating top and bottom line there with lot of volume growth. the company lowering operating costs. amgen made a 400 licenses repayment. the stock climbing on the news, even after having a 9% run-up, just over the last -- i should say 7% run-up over the last two weeks or so. revenue did fall 1% year-over-year because of a 5% net price declines a well as a 2% impact from foreign exchange headwinds. the company mentioned narrowing its full year 2022 guidance. i was listening on the conference call right now. analysts are very interested in amg-133, a drug that could help fight obesity and rival drugmaker novo nordisk as well as eli lilly

they didn't give details of what near term means, saying they reveal more trial data first week of december back over to you. >> kristina, thank you what do you think of biotech >> biotech is the most interesting part of health care. we know you have got the big names like lily and america doing well always commands a high multiple. but it's fairly safe the real opportunity is in these high bid names all lost to 60s 70% that are starting to return >> enbrel is a monster drug. amgen has about 8 to 10 drugs that will probably do north of a billion dollars in revenue for the year third quarter they beat by 26 cents. what people might be a little upset about, they tweaked guidance, but only raised it by what they beat and lowered the top end. with all that said, that's a bit of a sandbag they'll probably earn closer to $18 a share, which may see stock less than 15 times next year's numbers, which is too cheap for a stock that recently made an all-time high. amgen we like for a while. i continue to like it.

>> all right there is a lot more "fast money" to come here is what is coming up next >> ads to the rescue netflix's latest plan goes live today as it looks to boost subscribers but will the commercial kick be enough to get this streamer revved up? the details next plus, jobs, jobs what tomorrow's big report will say about where the economy stands the traders break down what to expect you're watching "fast money," live from the nasdaq market site in times square. we're back right after this. ial i stand by these promises: i promise to be a careful steward of the things that matter to you most. i promise to bring you advice that fits your values. i promise our relationship will be one of trust and transparency. as a fiduciary, i promise to put your interests first, always. charles schwab is proud to support the independent financial advisors who are passionately dedicated to helping people achieve their financial goals.

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welcome back to "fast money. a big day for bingers on a budget as netflix rolls out its ad supported tier.

will a lower cost option give it a leg up in the nonlinear space? julia boorstin is covering it. >> netflix launched its new $7 a month ad-supported subscription, $3 less than the basic netflix subscription that doesn't have ads. ned flicks tells us there will be a limited number of titles that aren't available due to licensing restrictions they say they're working on that they also tell us that the titles that are available represent an average of between 85% to 95% of what's most popular on netflix right now, depending on the country we did see that some titles, including some james bond and morbeous are locked. that gives users the option to change their plan and to pay a little more to watch those films. today's launch does come about a month ahead of the launch of disney's $8 a month ad-supported tier, and it really marks a new phase in the streaming wars, a fight to hold on to consumers who are looking to cut back on spending by giving them cheaper

options. netflix warns that this would be a slow ramp-up of its ad business, but once netflix with ads is at scale, we'll have to see if its ad inventory can steal share from hulu, peacock, paramount plus, or even youtube. and melissa, while i'm here, other big advertising news more big advertisers are pausing spending on twitter. this according to a new report out from "the wall street journal" naming general motors, audi, mondelez, pfizer we connected with general mills. they confirmed and told us, quote, leconte to monitor this new direction and evaluate our marketing spend. melissa? >> i have two questions for you, julia. how should we view ad dollars that go on to either an internet platform like a twitter and ad-supported streaming service like a netflix are those usually the same sorts of dollars is there competition there, do you think? >> there is usually i think a different category between twitter and what's happening on the ad-supported streaming

i think that netflix is hoping to draw a share from traditional television, right, from traditional ad dollars, or from even old-fashioned ad formats like say radio or outdoor advertising. but they're trying to draw share from some of these traditional formats and also compete for these streaming video ad dollars. it's kind of a different format. twitter is kind of its own category remember, it's a much smaller platform than say a meta but they have direct response ads, and they have really been trying to invest in their brand advertising business but remember, they don't maybe know as much about the user than a meta does. so it's a different type of advertising. and i think the big brands general mills, they want to make sure their brand is in a safe environment. in you're advertising on netflix, hulu, you know exactly what that content is going to be it's not user-generated. that's why i think these are two different categories >> it almost seems premature for these companies to say we're going to pause because we think

it might not be a safe environment. nothing has really happened so far. >> well, that's not necessarily true there was one study that found that there was a 500% increase in hate speech on the platform just on friday, the day after elon musk took over. and so there is this question of whether or not trolls or different people are testing the limits of what is appropriate on twitter. so i think for now, elon musk has been meeting with advertisers, trying to reassure them they want to understand that their brands are going to be in a safe environment >> all right, julia, thank you julia boorstin i don't know where you want to go here, twitter or netflix? >> i feel like i'd be baited if i went to twitter, politically-wise >> why >> of course it has to be an increase in hate >> you're doing this to yourself, by the way keep going >> the option and you went down that road. >> i'm going to go down that road i think there has to be an increase -- first of all, i don't know what is considered hate speech. i don't know what is >> right. >> you know it when you see it,

right? but if you're only hearing one side of a fight, there is going to be no hate speech, does that make sense i think what elon musk is trying to do is get multiple viewpoints on the platform. everyone knows there shouldn't be hate speech, right. so that's a given. you get where i'm going or no? >> he has already told an eu regulator that they are going to comply with very strict eu rules when it comes to content so there seems to be early indications that elon musk is willing to comply to some modicum of standard. >> well, you can only go so far until you break -- break your machine, right, and your reputation, yes. >> i just think the things that i've heard over the last couple of days that are more impressive are the ways he is trying to monetize it. by the way, he doesn't have to worry about public markets they just don't care anymore that's actually what is interesting to me. >> if you were a twitter shareholder, wouldn't you be glad if twitter we're going charge for the blue checkmark? we're going the charge

this and that? >> yes the things he is doing are things i would have been happy about as a former twitter shareholder except i don't own the stock anymore. i think what he is doing is good for the intrinsic value of the company, buttite retardant talk about netflix. >> jacob versus ohio if potter steward were here, unfortunately he can't be with it, he said i know it when i see it go to your google machines and check that out in terms of netflix, thanks for bringing that up carter braxton worth has been saying for the longest time when netflix were down in the 180s, there are gaps to befilled on the upside if we were to trade up to 300, we would successfully fill those gaps when netflix was 180, we talked about it for the first time in a long time. you can make an argument on valuation. all true it's given back 10% in 2 1/2 trading days there will be another place to reload i think on the long side but unfortunately, i think it's closer to 2 1/4. coming up, october jobs numbers on deck. what tomorrow's report will say about the labor market we're hitting that next.

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welcome back to "fast money. more signs that job growth in

the tech world is slowing. payment processing company stripe slashing 14% of its workforce. lyft cutting back by 13% and amazon telling staff it is pausing hiring for corporate roles. the three moves comes ahead of tomorrow's october jobs report our next guest sees employment gains ahead for the overall economy. initial meyer is a u.s. chief economist for the mastercard economics institute. michelle, great to see you >> nice to be here thanks, melissa. >> the conspiracy theory here on this desk, michelle, is that tomorrow's report will be very strong, and that's why jerome powell was extra hawkish during the news conference. what are you looking for tomorrow >> well, i think the consensus forecast of somewhere close to 200,000 job growth sounds about right. it would show that the economy is still adding jobs well in excess of what you would need to see to keep up with the labor force. it would show that the unemployment rate should remain sticky low, and it would suggest that we're still going to see wage growth, albeit maybe some

moderation in the pace of wage growth the overall story for labor market i think is still very clear that there is still excess demand meeting a lack of supply. that's leading to tightness in the labor market, even if it's not quite as tight as it was, say, six months ago. >> how do you think about the unemployment rate and where it needs to go when the fed says that the terminal rate is going to be higher and it's going to be there for longer? >> well, when you think about the fed and their dual mandate, i think the general view, and what fed chair powell tried to communicate yesterday is that they have done more than they've needed to do in terms of full employment the unemployment rate is arguably too low it's creating too much inflationary pressure and too much kind of overheating in that economy. so it's natural to start to see that unemployment rate pick up and that is what's needed in order to feel confidence that they've done enough in terms of

increasing interest rates, transmitting that tighter monetary policy into the economy to hold back inflation so if you look at the fed's own forecasts from the september meeting, you have that unemployment rate in the mid 4% range. that might be enough or maybe it does need to be a bit higher, but it's going to be a function of when you see the shifts in the real economy that generate that moderation in inflation. >> thanks for joining us outside of labor which you just described in wide sticky for longer i used the term earlier folly as it related to the fed's 2% inflation target i think we'll never see that again in my lifetime based upon a number of secular trends that didn't just happen, and the end of four decadessecular trends that have happened your view? >> right, right. look, i think 2% is still fair i mean think about it. prior to the pandemic, we were all talking about how we'll never get to 2%. that maybe inflation target is

too high, or maybe we should aim even higher because it's so hard to generate inflation. and then the pandemic happened and we saw an extraordinary amount of monetary fiscal policy and we saw this pullback of the supply side of the economy because of supply chain issues and because of the dislocations that the pandemic led. and all of the sudden, we have above 8% inflation, and we've had above 8% inflation for the better part of this year i do think there is a path to get back to a lower inflationary environment. look at the good side of the economy. we're already seeing some disinflationary pressure there when you look at core goods. and that's a function of inventory starting to build and the fact that there is still these technological advancements that are ultimately disinflationary. so i think it is achievable. it's just hard to appreciate that when we're in an environment where inflation has been really high for too long. >> michelle, thank you good to see you. michelle meyer, mastercard

steve, what did you make of the action today in terms of anticipation of tomorrow's report >> i think that people have to realize that the market is going to get worse, right. powell is not going to defend the equity market. the market's going to go lower rates are going to go higher i do believe we're going to get a rally into your end based off the midterm elections. and as i said last night, we're really burning daylight for the amount of days between now and when the election cyclehappens going into europe. >> i mean, let's just say it's 50-50 and rates are going to go up our down. if rates are going to keepgoin up, there is no way the market equities are going to be in good shape. if rates start dropping here meaningfully, something is wrong. equities go lower. either way, what's the premise to be bullish? >> what if they stay around where they are >> they've been here forever already. it's still there is just no growth >> no multiple >> yep >> guy >> it's what you pay for earnings, right? i'm with carter on this one. if rates are going down in a

meaningful way, something bad is happening. you go into bonds because the equity market is getting torched. and if rates are going higher from here, it's not a good scenario it's not about growth. it's about inflation still out of control i'm with dubs. >> cbw >> just call hip dubs sometimes. >> coming up, the apple doesn't fall far from the tree but the chart master says forget that what he sees in store for the titan. and keeping an eye on block, paypal and coin bass after their reports. don't miss the ceo of doordash and "squawk box" tomorrow on the back of that company's report. that's 8:1a.5 m. right here on cnbc "fast money" is back in two. i'm so glad we did this. i'm so glad we did this.

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together. together. together. here, healthier happens together. cvs health. welcome back to "fast money. we've got earnings alerts on a trio of fintechs, block, paypal and coinbase kate rooney is all over all of this action. kate, over to you. >> melissa, hey there let's start with block, the leader here after hours a beat across the board for jack dorsey's payment company, and cash app was a bright spot this is venmo competitor it now has 49 million transaction users. that was up 20% year-over-year revenue for cash app was better than expected and square

that's the seller sid of the business, getting a boost from retail and restaurant spending there have been some jitters around both of these businesses and a consumer slowdown heading into the print block gave an update on october saying growth was consistent with the rest of the year they're expecting to stay steady through the fourth quarter we're hearing a lot about cost discipline on the call that's going on with analysts right now. on to paypal beat on most metrics for the third quarter, but it did cut its revenue forecast and that appears to be weigh ogg tonight stock. it's down after hours. paypal reduced total volume guidance as well it did raise its full year eps guidance by 16 cents caught up with dan shulman he told me they're being cautious based on the macro backdrop right now he said the low and middle end consumer is cutting discretionary spending while the higher end is holding up right now. he says paypal is focused on cost-cutting and we should all be prepared for a difficult economic cycle as we move forward. he says paypal is prepared he also announced a partnership with apple on payments and it comes after a high

profile deal, similar deal they had with amazon that rolled out last week. finally, coinbase, the crypto company is getting hit by that trading slowdown it saw a drop in monthly transaction users. and transaction revenue is down 44% from q2 thanks to the lower volumes. coinbase did see strength in subscription revenue that was up 43%, but similarly that to what we heard, it's getting help from higher rates net interest income made up about half of that subscription, and services revenue, it's also looking to rein in spending. that is really the theme of these three earnings reports operating expenses were down 39% from the prior quarter, and it reiterated some prior guidance on some losses what it's calling a loss guardrail of $500 million. melissa, back to you >> kate, thanks. kate rooney. tim, which do you want to trade? >> if i was steve playing the game which is the unauthorized of the three but you did just ask me. i'm going trade paypal and say

paypal is not a top line growth story in the near term it's a margin, g and a improvement story. but it's a valuation story that i think makes sense. guy, what is the term you used, the cut in half club this is one of the charter members of the cut in half club. 17 to 18 times forward, i actually think the valuation is interesting. i think you nibble >> when you have a heavy volume drop in gap, you leave people just from yesterday above trap, people who bought anticipating maybe a good result. so it's just difficult to recover. it's like a hole in a boat the water is coming in forget about going forward, we got to bail now. let's look at the one that's actually acting well after hours. but is it? it closed at 53. it's indicated at 60 it was 60 two days ago so all it's done, if it manages to open tomorrow where it is right now is recover two days of losses also in the down -- >> no one does the dramatic use of question better than carter. >> that's true >> is it i think he answered his question.

>> are they all boats with holes. >> coinbase? >> i think so. >> didn't paypal tell us they were out of growth when they tried to buy pinterest if you look at it on a chart, it's been down since that day, that they couldn't buy pinterest because the board said we're not going to let you buy pinterest they told us they were out of growth >> let's go to the crypto space. one option making a huge bet, heavily lever to bitcoin m mike khouw joins us. >> stocks moved 10% higher, lower by the end of the week and next week's options that were busiest. it was the weekly 260 calls that expire a week from tomorrow that saw the most activity. buyers were paying a little over 11 bucks a contract to buy those betting that microtragedy will rally at least 7.5% by the end of next week. >> all right, thank you, michael. for more "options action" tune in to the full show tomorrow at 5:30 green apple, red apple, a not so sweet move for the stock.

he'll explain that next. and do not miss generation gamble where we take an in-depth look into the world of online betting and gaming that is tonight 7:00 p.m. eastern time right here on cnbc. "fast money" is back right after this good luck. td ameritrade, this is anna. hi anna, this position is all over the place, help! hey professor, subscriptions are down but that's only an estimated 15% of their valuation. do you think the market is overreacting? how'd you know that? the company profile tool, in thinkorswim®. yes, i love you!! please ignore that. td ameritrade. award-winning customer service that has your back. this thing, it's making me get an ice bath again. what do you mean? these straps are mind-blowing! they collect hundreds of data points like hrv and rem sleep, so you know all you need for recovery. and you are? i'm an investor...in invesco qqq, a fund that gives me access to...

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welcome back to "fast money. a new report finds apple is pausing hiring for roles outside research and development the report comes as the iphone maker's stock loses more value the stock is now down almost 11% just this week the chart master thinks it's primed for a breakdown carter, what are you looking at? >> well, it's a big ol' mess this is kind of fun here it looks busy, but we can walk through it quickly so if you look at the past 20 years, apple has outperformed the market in 15 and underperformed in five but forget that. it's all about your compounding and annual growth rate s&p 7.6. apple 37.4 so what that means is 100 grand in the s&p, you've got 432 grand. 1 grand in apple, you've got $57 million. is that meaningful no what is meaningful is apple's

relative performance which has been oh so good is really starting to break down let's look at some charts. so the first chart is basically a ratio chart. it's just apple divided by the s&p. so it's not about the y axis if the blue line is rising, apple is outperforming the s&p it's declining, it's underperforming. what we know, we have come down to this trend line to the penny. and today we just broke below it now let's look at a longer term chart. and it's the same circumstance same circumstance. let's look this is '02. remember, it looks the same. that was only 5. this is 20 years of outperformance and the whole thing looks like it's going to basically give way here all things that are great come to an end. and it doesn't have to be the end of apple but just remember, cisco is worth more than anyone in the world. where is cisco so was at&t. so is u.s. steel, so was general motors so was exxon

you can be on top a long time, but you can't stay on top. >> what is the next level when we see this break that you're watching >> right so, again, not shown here. this is a relative chart but apple has done 4.5% today. i think it's got another at least 15, 20% to go. >> 15 or 20%, okay guy adami, what do you think down 15 or 20% >> i get you to 125. i can get in that ballpark obviously 20% is lower than that we talked about it in earnings quickly. the stock traded down to this level post earnings. it rallied when amazon had a miserable quarter. it was a flight to equality. this stock traded 158 two days ago. i'm with carter on this one. it's still an expensive stock in this environment. >> if you think the market is going lower. the market doesn't bottom until apple bottoms. the market doesn't hit a bottom when you sell your zoom. it's when everyone on this trading desk or all the holders -- i don't mean all, but the incremental holders sells theirs apple apple is supposed to be a quasi

safe bet in the marketplace. when people sell their apple, that's when you can say the market is bottomed >> why is apple trading at an 80 percentile of its last one-year valuation average? it shouldn't be trading near the top of that. if you look at apple in february of 2020, it was an $80 stock that had just rallied 60% from its lows at 2019 this stock had major momentum going into covid, and since covid it's traded from 80 up to where it is. the valuation is too high, and it's too big of a weight in the market that's another conversation for another day. but this is what we're seeing going on with mega cap tech. it shouldn't be this big of a structural waiting, not only in our market, but in the global economy. >> well, this is one component, carter of your call of s&p 500 to 3100 or so, right what are some of the other generals that we need to so go substantially lower here >> it's under way. we know microsoft is breaking down, google but what's kept the market from taking a down leg is we've got this money flow into things like

mcdonald's, into collar. caterpillar but those things are already exploited. here and now you have a circumstance where money has come out of the heavy big tech news, it's gone into some other quasi safe names but the net of it is now that it's gone into those, those are already extended, and the apples are dead so there is nothing left to play >> on that note. final trades ♪♪

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time for the final trade tim? >> walmart reports in about a week and a half. i tell you, this is the environment where walmart outperformed we've got that inventory warning, and i think you're ready to go. >> carter? >> best to maintain a defensive posture. we've got shorts, good keep a short in the spy. >> steve grasso? >> xle, sell say thank you for the profits. >> you have an entire city that is not happy with you. why is that, guy because last night, what did i ask? i said mel, will the phillies of philadelphia take a commanding lead in the world series tonight? you said absolutely. didn't you say that? >> what does that have to do with anything? >> tim, what happened last night? >> they got no-hit by 15 pitchers

>> there are a lot of people that believe you are the cause i'm going to give you another shot game five tonight. phillies or astros mel? >> phillies. >> wow i'm with you on that one look at amgen. the numbers were fantastic, mel melissa lee. >> thanks for tcngwahi "fast." "mad money" with jim cramer starts right now. right now. 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 try 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 just trying to save you my money. my job not just to entertain but put it in context. call me. 1-800-743-cnbc tweet me @jimcramer. nobody, i mean nobody believes me when i say the fed chief jay powell wants your portfolio to go down. because it's too cruel

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