>> and also in the morning, i'm going to have on the other hand on "squawk box," and race-based preferences in college admissions i want to get away from controversy. >> i mean, you just -- run right away from it with that one all right, that's going to do it for us here. all the major averages except the transports ending higher >> "fast money" starts now. right now on "fast," threading the needle a sign investors believe the fed has foamed the runway for the soft landing we'll debate that. plus, the fbi director warning that american companies in china are now being forced to let teams of chinese communist party operatives set up shop in their businesses to maintain party disciplines. how big a deal is this let's go live to washington straight ahead. and later a stock that's moving on up well, we will break down a left for dead company that's out of the dog house, heading back towards the penthouse, up nearly

750% since the start of the year the big reveal in the options action behind that coming up i'm melissa lee, this is "fast money," we're live from the nasdaq market site we start off with some breaking news out of disney shares right now are up in the afterhours let's get straight to david faber in sun valley, idaho, for all the details. david? >> reporter: yeah, melissa, tomorrow morning, we sit down with bob iger, of course, the ceo of disney. and the news right now is that he will be ceo of the company for a bit longer than had been anticipated. of course, our viewers may recall mr. iger returned to disney late last year as its ceo of a 15-year stint in that job out about 11 months. returned with an end date of the end of 2024. the board of directors has requested and he has accepted an extension of his contract through the end of 2026. perhaps a reflection of the challenging times that disney

finds itself in. perhaps, as well, that he wants to accomplish certain things and didn't have enough time in which to do it also puts off, of course, the search for a successor i'm told that senior management was involved in the decision and was encouraging of mr. iger remaining at the company, so, the second stint for bob iger would appear to extend for what would be a total of roughly four y years, instead of the two that originally has been agreed to, melissa. that's going to be the subject of an interview we conduct tomorrow morning on "squawk box. in addition to so many other issues involving the company, whether it's direct to consumer, the future of espn, and on and on but certainly important news for the market to digest afterhours. bob iger staying with disney for an additional two years beyond the expiration of his current contract, which was set to expire at the end of 2024. >> not too much reaction in the

stock afterhours on this news, david. there have been recent reports that there has been difficulty finding a successor. do you know who might have been on that short list just curious if there was anybody from within who might now be leaving the company because they weren't tapped on the shoulder and he's staying longer >> reporter: no, i don't think that really is going to be the case here. the sense is, they did a reorganization after soon taking over yet again with certain division heads, and i think the expectation within the company is that is where the key race is, but i don't believe that there's any expectation that any of those people, in fact, will be leaving in any way, melissa, or that there's anyone particularly disappointed at this point of course, his extension does come with the recent departure of longtime cfo christine mccarthy, but as for that search, it really hadn't begun in earnest, from what i understand, and will be conducted by the board of directors. and now it gives iger more time

to follow through on the strategic initiatives he's already put in place we know part of them involving cutting $5.5 billion worth of costs. we know there have been 7,000 job cuts along with that and getting the direct to consumer business on a path to, if not to profitability, as they've been saying at least so far, they expect it to be break even by the end of '24, so, that's sort of the task ahead for him. and again tomorrow morning, we're going to have an opportunity to speak to him at length about exactly why he chose to stay, what was behind that decision, and how he's thinking strategically about the next three years >> david, thank you. david faber joining us tonight from sun valley, idaho and do not miss that interview, the exclusive interview with bob iger tomorrow at 8:00 a.m. eastern time on "squawk box," without commercial interruption. do bonawyn, does this make you feel better as a shareholder >> i think in the short-term, it does, but in the long-term, it's some real concern. as we mentioned, what's the succession plan here and is the reason -- the reason

he was brought back was kind of right the ship and to me, it says that the ship hasn't been righted now. rather than him transitioning out, i'm happy to see him staying along and kind of stewarding this to where it needs to go. it does raise concern over the long-term, are they able to kind of put the succession plan in place necessary to continue kind of the pillars that he's setting up for >> just to underscore that, i mean, when he signed the contract, it was a two-year contract, was there a belief that two years would be the time frame that investors would have to wait to see the company be righted? and is now the timeline much longer, double that? >> i think the timeline is longer, exactly the way you said nice to have him at the helm, but wow the waters are choppier than we thought. and, you know, in the end of iger's era, it was about building up businesses, right? and obviously disney+ was everything, and now it's going to be more about the balance sheet, i think, as that becomes more of a burden, and your question was exactly what i was

wondering. does this mean they couldn't find anyone? i wouldn't have been shocked if there had been some sort of co-president or some kind of -- somebody elevated to maybe a future role -- >> right >> maybe not to the outside world, maybe to the inside world only, i'm not sure but it makes me wonder if they're back to the drawing board on this. >> did we chart where it was when he came back? the price is actually lower than when he came back, or in the same ballpark by a couple of percent? is that where it was so, to both of their point, he was seen as the knight in shining armor, including myself, i owned the stock back then. i thought it was going to rip higher it did, and then came right back in if you look at the pandemic low, it was in the 80s. this is not -- you know, pandemic low, no one was going to be going to the parks ever again. >> right >> and that's a huge number they do at the parks. so, this has become more of a political football with the state of florida, with governor

desantis, there's so much that overhangs that you can't really put a dollar amount on and a performance level on the stock that's what we're seeing, and we don't have anyone to fill his shoes, which is very concerning for shareholders >> maybe the political issue is impacting disney, maybe, maybe not, but what we do see and what was reported by "the journal" just this week is that it's the best time to go to disney world, because there are no lines and what does that tell you? >> sounds like yogi berra. >> nobody is going right now, fewer people, or people had gone right after the pandemic, they've all gone, and you're not going to go back for another year or two. tim seymour. there are problems, there are issues here, tim, with disney. >> yeah, i feel like we have priced a lot of that in, again, if anything, the updates we've had recently, you guys have addressed this, domestic and international theme park segment is very strong

and the problem has been the growth or lack in the dtc ecosystem. it not even that it's slowing, it's that you's pulling down net income so, i think you take it right to a valuation, for a stock that's at a five-year low, you put a three or four-times revenue on the dtc business, half of what it was when the stock was soaring, and you put a 12 tims on parks i don't love this news, i don't hate this news it's not a surprise, as everyone has said there's not an easy solution here, but gets back to a company that has priced a lot of bad news is. we know what's going on at linear networks, we know the profitability at dtc is seemingly not even close but the rest of it more than pays for itself. i'm not selling it now >> we've had a lot of conversations about how netflix is winning in the streaming

wars, because everybody else is concerned about turning a profit and getting to profitability and that's putting additional pressure, you know, on themselves, in light of netflix's ability to just be and be the king in this sandbox. so, given that, i'm just curious. given that, plus the possibility that consumers might be headed into a recession, might be -- they may not have completely pulled back their spending yet, maybe the worst is still to come have we priced that in >> you know, i think tim touched on it, steve mentioned it, as well, looking back at those pandemic lows does give you some type of way to look at the stock here and being that we're within striking distance of that level does give me some comfort, because that gives you an idea of what it looked like -- maybe people had the money to spend, but could not go for vaccine or pandemic reasons or whatever essentially, the turnstiles were not being run like they're being run now. so, that gives me some pause and

i'm saying, like tim, i'm not willing to dump the stock here as it pertains to the question about netflix, this sheds some light on the fact that maybe this thing does continue to squeeze higher, because part of the attractive thing about disney is that they have hulu and the other aspects, they do have the parks and dtc, which we thought were linchpins of that business and could withstand, you know, headwinds in other areas so, i just think it kind of shifts the way through which you're kind of looking at it to kind of wrap this thing up, looking at disney, where the stock price is now, it lets you know that, you know what, probably a lot of this bad news is priced in if you were expecting the catchup trade, we talked about that between disney and netflix previously, you are probably going to have to stay in that longer than you expected >> let's get to the markets right now, and the question we asked, right in the open of the show, has the fed been able to successfully engineer a soft landing? inflation is cooling, the s&p is

at a 15-month high, and there are surprising areas of strength in the market. banks, big tech, energy up today. so, does this market action suggest the fed has actually threaded the needle in the slowing economy? the reaction to cpi was everything is up >> yes i mean, i think it's still too early for them to say, you know, we did it, because the one thing i've been somewhat skeptical of, i understand, there's a lot of people that think the lag has still not been seen yet and we could still be, you know, awaiting a recession as some of the mortgages roll oaver. but i think they're doing a good job. if you had looked at when they started this, right, and when inflation was -- we were getting the higher and higher prints and we would have said, the market's here, the economy's here, where it is now, and now inflation is here is would you think the fed would have been able to do that? i would have been skeptical. >> they're not done.

i think we're a little presu presumptuous >> agree we're not there. >> we're assuming that they're going to take the lead and say is hey, we're done, that's it you we're going to go one more, maybe possibly two but they could overreach, which is what they typically do. so, it's a little presumption to say they've done the soft landing yet. the data's backing that up, but we don't know if they're done. >> right and all the fed speak that we've gotten indicate that, you know, they believe that there is more work to be done. roger ferguson, the former vice chair of the fed this morning on "squawk box" said september is still a live meeting nobody is really -- nobody's pricing anything in, but he thinks it's still live, because the fed wants to make sure that inflation is dead, bonawyn >> yeah, you know, i think we should -- they need to take a slight step back here, right i think the peak inflation story has definitely kind of fallen through, and this is what we see. and that's kind of what's setting up the goldilocks situation. to karen's point earlier, if you looked back, if this was the path to getting here, would we end up here?

i certainly didn't so, i think the fed has done their job. but to your last point, they are going to make sure, and the base effect is going to get harder and harder as inflation gets lower and lower, for us to continue to have that continued slowing. so, i do think the fed will likely err on the side of hawkishness, and it's going to take some very compelling data set up over several months to get them to slow down. the last thing is, i don't necessarily think that them not continuing to raise rates is now the new story. now, it is higher for long er ad what affects that has on the economy, and i think that needs to be the next thing that we look at. but in this vacuum that we're in right now, until we see something, whether it be consumer credit or defaults or commercial real estate or earnings, until we see something that kind of shifts this narrative away from peak inflation, people are going to continue to want to own risk assets the real question is, what amount of money do you need to be paid over treasuries to be

taking on that risk? >> right tim? >> well, i think we need to just not be as bulled up about today's cpi number i understand it's a third of what it was at its peak, everyone knows that, but the core -- and was better, but still, at 4.8%, and, you know, although at 4.1 over the last few months and 4.6 over the last six months, fed likely is not seeing this as underlying inflation is its friend here and i guess we expected cpi inflation to come down to this point driven by lower energy prices, and less from the easing of underlying inflation. i think some of the pressures are still there. having said that, you know, yet another acronym for markets here, i was tweeting this out, rino, recession in name only, is that term you hear going around again. now, after the kind of growth that we've seen over the last couple weeks, both in the labor market and even if it's slowing, and where the inflation is

coming down and the fed is kind of, as we know, one or two hikes away from being done a question of how long they stay there. i just think that between the seasonals, between the positioning, between the scramble and the fomo for a lot of people that have missed this rally, because people have been overly bearish, i think the market can run at least until the next fed meeting not forever, and so, this is more, you know, call it a s slightly tactical view, but i still think that today's cpi number was a very good number, and at least gives the market room to rally, but it's not the answer for the fed >> and certainly gives tech room to rally that pull-back in the ten-year, it wasn't that long ago we were looking at above 4% and here we are, bonawyn is this sort of the free pass, at least for now, for tech stocks to continue higher? >> i think that's part of the equation i think the other thing is, tim mentioned it, a lot of people have missed the rally. i've missed decent part of this rally. there's certain pockets of stocks that have done well but i think there's still those

handful of names and a lot of them are in tech, you buy them, you say to yourself, okay. the fundamentals behind these companies are still set up such that if i'm wrong, i feel good about being in these names, and now the narrative, whether it be a.i., but let's take that example, now there's also a growth narrative around that so, you know, you see other pockets where people are kind of chasing, there's an article out about people chasing meme stocks and redeploying in the speculative pockets. those five to seven names still make you feel good about owning them and being that if you own them, you are likely going to play along with the market, you don't have to worry about so much basis risk. i think that's another reason you can see them kind of outperform >> one of wells fargo's top analysts saw the number as good news mike schumacher is with us great to see you >> thank you, melissa. great to be here >> and you yourself were flagging that big move that we've seen, we just talked about the big move particularly in the

ten-year what does this mean to you connect the dots in terms of that big treasury trade. >> yeah, it's interesting. i think people are getting onboard the idea the fed is done a bit too soon i agree with the comments your colleagues made. a really good day for the fed. if you look at core inflation, still running pretty hot, 4.1% annual lized over the last quarter. so, people tend to get really bulled up. it's an interesting pattern. when the fed is done, the fed will announce it, obviously, but the market gets ahead of it, you see the enormous move in treasuries we saw a bit of that today i think it's a little early, frankly. >> i think i asked everybody this question when i get a chance to interview, you know, strategists like yourself, michael. do you think the fed sees this reaction in the markets and think, you know, this market needs a talking to and when they have that press conference, you know, in a couple weeks, they're going to be extra hawkish to convey to the markets that every meeting is, in fact, live, and you cannot assume that the door is closed at this point because the markets are acting like the door is closed, they're done

>> markets are acting like it's 5:00 somewhere, for sure they're having a good old time and i think for the fed, the real challenge has been, the fed can talk about a rate hike or two, and people sort of get that, but where it's really failed to convince the market is, hey, we're going to be, once we get the policy rate where we want it, we'll keep it there for a long time. year, year and a half. powell talked about two years. the market does not believe it i'll give you some numbers if you look at the rate cuts priced by the market for 2024, right now, it's about 125 basis points one week ago, it was 80. 8-0. so, the market said, oh, if the fed's about done, it must mean a rate cut is around the corner, that's good news the fed wants to try to walk that back. >> michael, how much of this is nuance versus science? do you think if the market gives them, you know, a little more room to raise rates a little bit further, will they take it and it has nothing to do with their game plan?

>> perhaps i mean, i've never bought that argument entirely, but if the fed's leads were a rate hike, which it seems to be doing, and the market is priced for 85%, something like that, let's say on the morning of the meeting, yeah, it probably takes it but does it necessarily want to push more onto the market if it's not really ready. i don't think so so, it's not to much the market giving the fed permission, but if they both line up, makes the fed a little bit more comfortable. >> it's karen, thank you for being on what do you think is going to happen to the shape of the yield curve? this inversion is quite pronounced, and it's been that way for a long time. >> yeah, it's interesting, karen. i was in asia a couple weeks ago, and that was the question we got from every client when is the curve going to steepen, it's hurting my business, et cetera. when you look at the historical data, and i think this applies to this case, as well, what typically happens when the fed is done hiking, this enormous move down in yields, but it

takes awhile for the curve to steepen. and i think you will not get a positively sloped curve, let's say two-year versus ten-year treasury, until the fed actually cuts so, could be quite a ways off. so, perhaps a little bit of steepening, less inverted, but positive slope we think that's a ways out. >> and you think yields are going to go lower? you're saying to buy treasuries at this point and that will be more pressure on the dollar? >> almost there, melissa i think for us, we'll probably wait another few weeks, a month or so, but we're just about at that point it's clear the market is amped up to buy. i think it's overshot in the last couple days, but if the fed goes once more on the 26th of july, we think it's probably a pretty good sign to hop in we're just about that point. >> are you going to release the kind of trade that's, like, buy five minutes before and sell 14 minutes after? >> exactly right. wait for the announcement, 27 1/2 minutes later, not a

second more, that's the kind of trade we love to do. >> all right, i'll get the egg timer out. michael, thank you, good to see you. bonawyn, what do you think that yields will go lower? >> i think it depends where in the curve. i think the intermediate to longer term, because i want to say long-term is technically 30 years. for that five to ten-year period is probably where you want to look some of the free money on the front end of the curve might be coming to an end >> yeah. >> yeah, i feel like i want to make a little more front end bets, just because -- it's almost been a year since i started, so, it does a rolling over, and -- >> right first ever treasury. >> yes, my first ever. and now i have a few of those. and i feel like that's still -- particularly as the market has had such a nice run, now that f5% plus, risk/reward seems compelling. coming up, a talk about a

duel mower to. one an lis getting bullish on gm, looking for the stock to double the driving force behind that call next. plus, linkedin and inflection cofounder reid hoffman joins us to talk about investing the a.i. space don't go anywhere. more "fast money" in two qualify sometimes you need a second opinion. [coughs] good to go. yeah, i think i'll get a second opinion. all these walls gotta go! ah ah ah! i'd love a second opinion. no. i'm going to get a second opinion. with innovation refunds, there's no upfront cost to find out. so why not check like i did for my small business? take the first step to see if your small business qualifies for the erc.

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welcome back to "fast money. ample upside ahead for gm. that's the call of the day from analysts at citi the firm says strong pricing in north america could help the company beat eps estimates for the year and sees positive catalyst from its ev and cruise businesses raising their price target to $89. and that is 120% high er from today's close. tim seymour -- >> ha-ha >> you can see that path to 89 >> you can't see me right now, but i'm not sure i can see the path to 89, either the path has been 30% up since june 1st for the stock, a few dynamics just industries we talked about that last night. they report on the 25th.

if you look across the street and you look at citi, they're at the upper end of the range on eps, on 2023, they're calling $7.75 a share, i believe most of the street is only, you know, 5% to 10% low er, and they're somewhere around $40 to $45 a share, so -- look, i -- i believe more in citi's view than i do a lot of the street, a lot of the street is also pretty bullish here the valuation is compelling, at 5.5 consensus pe, and continues to show that they are growing free cash flow, that they are certainly the most efficient of the big two left in detroit, and i think you stay long here i'm not sure you're getting 89 >> the excitement is not around ford and gm. ford and gm are value stocks, if you will the graphic that we just showed with tesla up 120% year to date,

gm has trailed even ford, ford's up 30% it's been lackluster the excitement is around evs, whether it's rivian or tesla that's where the growth seems to be coming from, not these old automakers >> yeah, rivian is up 85% in just the past month. bonawyn, where do you stand here >> yeah, i think the lack of excitement is exactly why you want to be buying the names. i think steve's point is right on clearly the stock performance alone will tell you what you're excited about. but by the time that wave of excitement hits the stock, it will be too late for you to have any chance of getting that 120% kicker that they're calling for. so, you know, for me, the fact that they were still able to grow, i believe they grew 18%, 19% over q-1, and still talking about combustible names. i have confidence they are going to be able to right size any production issues they have, and find their proper seat at the table as it pertains to ev

capabilities, so, i think that if they do get that piece of the puzzle right, and it's a large piece of the puzzle, you're able to get a company at six times ford, or seven times ford, and pay -- and buy a value name for something that does have the upside of an ev, and that's kind of the way i like to look through it. all right, a lot more "fast money" to come, here's what's coming up next the sun never sets on sun valley top execs laying out the future for media, entertainment, and more and the founder of linkedin is placing his bets on a.i. where you can find opportunity in the space, next plus, chinese cells in the american board room? why the fbi is flagging how u.s. companies do business in china and, how the country could have more sway than you think you're watching "fast money," live from the nasdaq market site in times square. we're back right after this.

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welcome back to "fast money. we're headed back to sun valley, idaho, where julia boorstin is sitting down with a special guest. julia? >> thank you so much, melissa. i'm joined now by reid hoffman, co-founder of linkedin many years ago, body member at microsoft, a founding partner at gray lock, and among many other things, a cofunder of inflection.ai, a big new startup in that space, in the a.i. space. i want to start off with a conversation here in sun valley. i've talked to so many ceos who say a.i. is at the center of every single conversation, but the future of their businesses my question for you is, is there a lot of fear about a.i.

eliminating jobs or about driving efficiency what role do you see a.i. as playing in this new comeconomy? >> so, the way i frame a.i. is to think about it as the new industrial revolution. the cognitive industrial revolution the steam engines of the mind. and that by the way is both glorious and concerning. glorious, because all the productivity we have, the industrial revolution, the wealth, the prosperity, all the institutions, construction, transport, et cetera, all comes from that. same thing we're going to see in cognitive. now, that will lead to a lot of job changes over time. almost every job will be to touched, anything from being a cashier or a bank teller, all the way to be a radiologist or a lawyer or coder, all of those things will have an a.i. personal assistant for doing it, and that will change things. change industries and everything else the good news is, is that a.i. can be part of the solution. so, you say, well, okay, so,

truck drivers, maybe that will eventually -- we have a shortage right now, maybe that will all be autonomous vehicles as ways of doing this, and you say, okay, what happens to truck drivers? well, we create a.i. assistants that help those people like, say, hey, what else is possible for you how do you learn that job? how do you get that job, how do you do that job? and the thing that we should be wanting as a society is a.i. to help everybody in whatever they're doing, not just the, you know, wealthy people or anything else >> to augment capabilities so, tell us a little bit about inflection.ai. you raised $1.3 billion, you are a cofounder of this company, as well as your role as an investor, and its valuation is $4 billion, partnerships with nvidia and microsoft how is it differentiated and what do you see its role as being, especially when you think about your role as a microsoft board member >> the idea behind inflection is

that every human being will eventually have an artificial intelligence personal assistant. a pie of personal intelligence, to navigate your challenges. i've got these things in the refrigerator, what should i make for dinner my blender broke and how do i fix it, or, i have this challenging conversation with a coworker, and how do i help have a better conversation, or, i have this friend that i feel like i'm growing alien nated from, how do i talk to them? it's the whole thing and that's the idea behind inflection, and so, it's trained to be good on not just iq, but eq being kind, compassion gate. it's trying to help you interface with people. as a way of doing it microsoft side, well, that's fairly simple. inflection is kind of a live personal assistant microsoft is, hey, how do we make organizations and individuals more productive, there's a natural clap ration. >> i want to understand your perspective on the tech titans

yes, you are on the board of microsoft, you sold linkedin to my have to koft and you are working on this a.i. company that is also aligned with microsoft. there's this question of which of these tech titans will be the most successful in this a.i. race, and also a question of whether startups really have a shot at succeeding when they are competing against the googles and microsofts of the world. who is going to win this a.i. race >> so, i think it's a huge tidal wave that's going to benefit lots and lots of players, both large and small players. so, it will be great for microsoft, great for google, but that's a reason why i invested and cofounded inflection pie is this amazing agent. i recommend you try it try it, right? adept, snorkel, all of these different things, coda, all of these different things artificial intelligence amplified, and part of the amplification of humanity. >> i have to squeeze in a last final question on threads,

because you were an early investor in facebook what do you think of this new app? >> it's a great app. it's a great product launch. amazing. i love to see where it goes. >> we'll be watching reid, thank you for joining us here in sun valley melissa, back to you >> all right, julia, thank you and thanks to reid hoffman, as well we were just talking the other day about the ftc's effort to block microsoft from buying activision and the court ruled on the side of microsoft and how it opens the gates, and karen, you're saying, for companies like this, like reid hoffman's startup, wow >> look at the investments and there's many others that are doing all these kinds of -- it used to be pre this ftc or in the last couple ftcs that you could just have the path of, we're going to create a great product and we're going to sell. and then that seemed to be off the table. i think it might be back on the table. >> yeah. tim? >> well, i think it's exciting day for the world of innovation

and entrepreneur sship, becausee talked at length why knocking down that merger made no sense so, when it comes to a.i., and we talk about the hyper scalers, we talk about the microsofts reid just talked about the tidal wave right now, there's no question, they have a head start, because their front line on applications, where we're using a.i. every day, and i go to meta, where -- i just -- i lolook edded a their core business right now and i think a.i.'s been a big part of their business and now gives them the aggressive scale and threads and reels and parts of their business that right now, i think it's really making a difference and i think they get bigger. all right, coming up, the key stock level that was crossed today and where it could go next. plus, what the fbi is saying about u.s. companies doing business in china, and how the country could be steering operations from the inside

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welcome back to "fast money. stocks rallying after this morning's cooler than expected cpi inflation report

the do jumping a quarter of a percent. nvidia shares rising more than 3% on reports the company is in talks to be an anchor investor in chip maker arms ipo regulators forced nvidia to stop its acquisition of arm last year shares of footlocker getting kicked after analysts lowered the price target on the name the stock dropping 3%. you are still giving mary dillon the benefit of the doubt at this point? >> yeah, i think she needs more time that last quarter was really, really terrible, clearly hopefully she set the bar very low. but she's got a lot -- i feel like, you know, you have to give her a chance to see whether this transformation, spending more to build a different kind of store base, getting rid of inventory, helping fix their loyalty program, she's great at loyalty and dtc, so, give her a chance and it's, i mean, on metrics

beside this next quarter, i think it's ridiculously cheap. coming up, a crazy ride. this stock surging yet again as shares continue to skyrocket this year, and karen is eyes the company for a hit of whe iret could be heading next. don't go anywhere. "fast money" is back in two.me t it's your business. it's your verizon. a third kid. what if she likes playing golf? it's expensive. we're outlawing golf. wait. can i still play? since we work with emower, we don't have to worry about planning for a third kid. you can still play golf... sometimes. take control of your financial future to empower what's next.

welcome back to "fast money. fbi director christopher wray condemning new stipulations on american companies operating in china, including ones requiring foreign-owned firms to establish so-called communist cells internally to enforce the country's political order. wray's remarks before the house judiciary committee described the requirements as a comprehensive threat to u.s. security eamon javers has the latest in washington this is really troubling >> reporter: melissa, it is. chris wray said in public today something that he's said to me in person. he's concerned about american companies in china being forced to allow chinese communist party cells to operate inside their companies. now, that's mandatory under chinese law and has been for a long time, but it's been loosely enforced in the past recently, though, authorities have been ramping up pressure on firms to comply. >> any company of any size in china is required, required, by

chinese law, to have what they quaintly call a committee, which is essentially a cell inside the company, whose sole function is to ensure that company's compliant with chinese communist party orthodoxy. >> reporter: i've been talking to experts about this, and they say the cells have long been viewed by corporate executives as more or less benign the cells use computers, printers, conference rooms, for their meetings, but there's been a shift since xi jinping's third term began, and some companies, not all, that have business licenses enjoying venture agreements coming up for negotiation are being told that the cells inside their company will now have approval authority over some corporate activities, including things like hiring or investment, and that's what's raising some alarm bells among experts here in washington who think companies are being forced to cede some degree of control

of their own activities. and i can tell you that wall street is not immune to this i spoke to a large wall street bank yesterday where a source familiar with the situation confirmed to me that they do allow communist cells inside their bank in china. this person said that so far, at least, the cell doesn't have any authority over the bank's business operations, but the bank is in compliance with chinese law on this, melissa >> whether or not they have any sort of outward influence on operations, eamon, that seems to me less troubling than the fact they're using company equipment like computers, printers, and fax machines it doesn't take much to plant something so that you know everything that is being faxed or sent from that machine. >> reporter: sure. >> and to plant spywear into a company's system, to have it lurking around in that system for a later date we talk about cybersecurity all the time, and yet, we're giving the keys to the kingdom to these cells. >> reporter: yeah, and to be clear, these are employees of

the company in china, right? so, they are chinese nationals in china who are already working for whatever the big bank is, buzz they also are members of the chinese communist party and under the law, they are allowed to conduct their party activities inside the big bank, inside their offices, use the facilities and things to have meetings and in the past, they've done things like sort of book clubs where they read xi jinping's speeches and these were viewed as relatively, sort of annoying that you have to agree to this, but it's the cost of doing business in china, it's a cultural thing now, though, there's a new concern that these cells are asking for and demanding in contractual language operational authority, approving hiring decisions, for example, or approving investments or where you're going to open a new plant or branch. that's the kind of thing that really scares american capitalists, right because they don't want the chinese communist party having operational control over their capitalist operations, even in china.

so, and the question is, if you can't decide who you are hiring or where you invest your money, do you really control your own company at some point? where is the line? it gets very blurry there. >> a lot of troubling things emerging from that eamon, thank you we've talked a long time about the cost of doing business in china. you know, joint ventures with state-owned companies, tim, but this seems to be one step beyond how do you start thinking -- if this is really going to be enforced, how do you start thinking about u.s. companies investing or -- with a presence in china >> well, the bright light that's on u.s./china geo-politics, why we're focused on this now, and i agree, it's scary, it's not new. and this is the problem with technology it's the great kind of leveller. on some level, it allows everyone to compete on a similar playing field, especially with the same technology, or when technology is pirated, stolen, and what not so, i think we've talked about the impact of chinese pressure

on american firms, and those firms that won't play ball it's already been, you know, front and center in the tech sector, if we're talking about a nike or a starbucks or an apple is where we have to wonder these companies have assimilated and have done a lot within china, and that's part of why they have their success and i think they're playing ball. coming up, driving higher. what stock is speeding like it's on the auto ban this year. we'll reveal the name and the icarndnext stk ou for "fast money" in two.

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time for us to highlight a stock that's moving on up. we wanted to play the theme song from "the jeffersons," you know how it goes, but we weren't allowed. didn't get clearance, so -- here it is. carvana's a stock that's been on a rocket ride higher, up over 700% this year just a few months ago, we were talking about the company being wiped out entirely of course, it is still 90% off its all-time high, but how do you make sense of this move? i mean, it seems like based on, i don't know what -- >> i don't know. another kind of magic pixie dust, i guess. i'm shocked. one thing, if anybody knows the

answer to this, i would love to hear it, do they have a registration statement that they're allowed to sell stock at the money, you know, at the money stock sale from time to time, and we would see that next quarter, if they have done that. if they're not all over this, trying to monetize this stock run, i mean -- it's crazy, because you have -- let's look at their bonds, which months ago said this is telling you they're going bankrupt, so, clearly that wasn't right we have the bonds of 2025, i don't know if you can see the low there, there we go, and now look what's happened 13% wiyield, which is a big yie, but relative to a company about to go bankrupt this story has changed dramatically and that maybe, if they can sell enough stock, they can live to fight another day and then find another way out of it i'm shocked. i mean, nothing about the metrics of the underlying business has made me -- >> short interest? >> short interest, thank you gigantic, and i asked, though,

today, could i borrow? how much, 25,000 shares to borrow, i thought they would say some e nor moss number no, you're good to go. 2.7% i didn't do it, because it's crazy, because who knows where it could go. it could have lost $50,000 just waiting for them to get back to me it's insane. >> yeah, i mean, i'm with you, but the bond run, to me, makes more sense than the stock run does you have this mechanic essentially called cheapest to deliver, and you're going to go out and you're going to get cds or something, you know, against the bonds, and you have to deliver something into that. so, the technicality, the america anymores behind that make sense the short interest, to me, doesn't explain the run gup in h stock. i think this is meme mania at its finest >> yeah, yeah. >> meme mania at its finest. >> you look for a high, short interest -- >> you look -- >> it doesn't explain, but it's, like, chicken or the egg on this thing. look for the high short interest

stocks that they can squeeze and then the rest falls in line. >> this would be the mother of all short squeezes, so many more waiting in amc let's get to the options activity brian sullivan has that. >> yeah, it feels like the short squeeze. people just panicking to the upside then we saw a very quick reversal, but before that reversal into the close happened, we saw about roughly 3,000 calls being bought that expire in two days, the $46 strike th paid about $1.70 obviously massive short covering using calls to the upside. >> brian, thank you. full show, options action, friday, 5:30 p.m. eastern time up next, final trades. you ok, man? the internet is telling me a million different ways i should be trading. look! what's up my trade dogs? you should be listening to me.

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76% of 23andme health customers surveyed reported taking healthier actions. for everyone who lives here. because they know health isn't just a future state. health happens now. start your dna-powered health journey today with personalized insights from 23andme. time for the final trade tim? >> yeah, i thought our fake jeffersons music wasn't that good i was going to sing it, but i won't do that, instead, i'll sing the praises of disney dis. i think you buy it here. >> karen >> yeah, we talked about it, i feel like the risk/reward in the six-month treasuries is pretty good that's my final trade. >> bonawyn >> i'm going where the excitement is not yet priced in, gm i think they will eventually get there. >> grasso? >> do you think any of the viewers remember the jeffersons?

>> yeah. >> really? >> probably not. >> tweet at us clear secure tell think bounce off the recent low. >> they do skew young. that's true. thank you for watching "fast money. "mad money" with jim cramer starts right now 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 other people want to make friends. i'm just trying to make a little money. my job is not just to entertain, but to educate and teach so call me at 1-800-743-cnbc or tweet me @jimcramer. going in the right direction i heard it all day the consumer price index is no longer red-hot, and it looks like t