san francisco. we'll talk about a.i. and more, and this a.i. story is going to continue to be important not just for nvidia, but cross the market, because is the demand durable? it's going to take software and development of new models that companies can actually get productivity out of to prove that one way or the other. we'll see what we get from google next week. that will do it for "overtime". "fast money" starts right now. john, thank you very much. right now on "fast" fed chair powell waxing poetic saying we are navigating by the stars under cloudy skies. there's a metaphor for you. he also said infliation is too high still and prepared to raise interest rates farther. why did stocks finish on a down note? zillow testing medical report ganls with just 1 % down. is this a smart way to help cash

strapped buyers or a disaster in the making? later in our chart of the weak, a shoemaker's epic losing streak and why it could ripple across a host of consumer stocks. good afternoon, everybody. i'm tyler matheson in for melissa lee. that's "fast money" live from the nasdaq market site. on the desk tonight, steve grasso, tim seymour, and tim kaiser citi's head of equity trading. stewart, welcome. we start with the markets and the fed jumping today despite chair powell's warning that more rate hikes could be ahead. how hard a warning was it? or was it a little squishy? treasury yields rising. two-year surging to its highest level since the first week of july. cnn's senior economics reporter is in jackson hole, wyoming, a

beautiful spot, with all the details. >> reporter: thanks a lot. fed chair powell delivering what you could call a moderately hawkish speech. said inflation was still too high, and says his choice seem to be holding rates at a restrictive level or hiking again. >> we are in a position to proceed carefully as we assess the incoming data and evolving outlook and risks. two months of good data are only the beginning of what it would take to build confidence that inf inflation is moving sustainably toward our goal. we can't yet know the extent to which these lower readings will continue or where underlying inflation will settle over coming quarters. >> markets sold off in anticipation of the speech, and in response to stronger economic growth numbers we've gotten some equities were higher and bonds were definitely higher as well. the outlook for fed rate hikes

increased. the probabilities of a november increase passed the 50% mark, stand at 56% now. powell mentioned several factors or scenarios that could lead to additional highs. economic growth running higher than expected. inflation down, and the labor market remaining too tight. three scenarios he suggested could lead to higher rates. powell made clear no decision has been made just yet. there were a few remarks, not many, including that payroll growth lagged and rate hikes could hit the economy. but overall message was a fed chair skeptical that maybe enough had been done to bring down inflation and willing to give the economy some time, but kind of maybe a little if si to hike again if inflation does not cooperate. >> let me start off our q&a segment. what are the data on which the

fed will be most dependent in. >> start with inflation, the pce number, which we're going to get next week i'd be looking at the growth numbers as well, the payroll numbers to see if there's that loosening up. i think it's important to note, tyler, that powell repeated his idea from last year that bringing inflation down was going to require a period of below trend growth, so that kind of tells you, watch gdp. the chair wants gdp running below 2%. that's a place he'd feel confident inflation is being brought down more convincingly. >> steve? >> so, steve, when i heard chairman powell make the comment that the housing sector has picked back up again, there's two elements to the housing sector -- the existing and new home sector. existing has been plummeting and new homes have been rising. why are any so myopic on that when the one that's critical to

rates isn't really rallying? >> it's a good question. i think the way to think about how the fed thinks about housing is through the owner's equivalent to rent. they see that number coming down, inflation over time. but because new rents don't reset and new housing costs don't reset with everybody automatically it's going to take time to work through the index. so what he's saying is essentially we're worried it's picking back up, but we still see it coming back down and lower numbers working through the index over time. he's not going to front-run those numbers coming down, steve. >> tim, let me turn to you. we point out steve leisman is the only man who can stay dry in a rainstorm. >> steve, my question to you is, where do we think there's dissension within this fed? we have had a lo of talk over the last couple days. this seems like a fed that really is doing its best to stay

together as a group and, you know, there's often an undertone at other times with other feds that we never really felt like we knew where they were going. >> tim, i really like your question. i think i know why you're asking it because as an investor you want to understand the parameters of the debate at the fed to understand what the risks are. what i can tell su having talked to three fed officials on the record here, the parameters of the debate are on the hawkish side, because your doves are those who don't want to cut right away. they just don't want a hike. they want to maintain a restrictive level. that's the dovish side. and the hawkish side is one and maybe two more hikes among some of the most hawkish members of the fed. that's the parameter of the debate. i have not heard anybody out there saying either publicly or in the hallway saying, we ought to be cutting right now, the fed is way too tight. that's not part of the discussion. when it comes to hikes, powell didn't mention, although some

dp people did talk about it, it's a next year thing. >> hopefully you can get fishing in. maybe starting right now. if not, over the weekend. >> you know what they say, tyler, they say the fish are already wet. doesn't matter. >> that's right. steve, thank you very much. and the fed okay will be closely watching next week's key economic reports -- jobs, inflation, housing numbers. doesn't get much bigger than that. how could these developments move the needle for the fed? stewart, let's bring you in here. mentioned to steve this feels like a data dependent fed. one of the data, mentioned three -- jobs, inflation, housing numbers. those are real centers of the rodeo. >> i think from our focus the perspective is on the jobs report next week. as steve mentioned, chair powell repeated the message they need to see weakness in the labor market to be convinced there's enough tightening going through the system. >> we've seen none of that. >> consensus is under 170k for

next friday. that will be the lowest positive in print since december 2019 and lowest since in print december 2020. you're starting to get to a point where you're at the lower end of positive pripts. we'll be focused on payrolls as the number one indicator next week. >> how about inflation. where do you think that's moving? >> our view is the next month or two, you can continue to have an easing of inflation similar to what we've seen recently, back-to-back sub 20 basis points. but our economists expect it to turn higher as we get into the end of the year. >> from what? why? >> you have some -- housing. owners equivalent rent has been sticky. looks look it may pick up. air fares were low last month. expect that to consider given the strength in domestic travel. we do think you could get inflation turning higher a bit. seems like the inflation is

turning towards that. within the next month or two, probably not going to be an issue. as you get back into the year it could impact some people's radar. >> steve was asking a question about housing. where do you see that playing in here? you look -- >> two dimensions of it, existing and new. >> existing and new. you've got existing where people are sort of mortgage stock. >> married to the medical report g mortgage. and people are going into the new houses which are selling nicely. >> you've got mortgage rates at a level we haven't seen in 20 years. that's going to be a head wind for both things you described. hard to get out of a lower cost mortgage and makes the cost of buying a new home prohibitive. that type of tightening should be hitting the economy. as steve mentioned that looks like it came in and is back on its way out. i think the question here from my perspective is it really gets back to inflation. >> you're getting out of the

prime home buying and selling season as you move into the fall here, right? >> right, and these are first-time home buyers predominantly, because they don't have anything to sell, so it makes it more reasonable for hem to enter the market, and the reason the housing stocks have done so well is they're buying down those mortgage rates trying to be more competitive. you look at the start of the show and say, why did that market rally? sounded just as hawkish as it's ever been. historically, the market will see the fed level off and six months later they'll do their analysis and historically start cutting rates six months later. if we give them september and even november, then you're looking at that first rate cut maybe in may/june. i think that's where some of the street is right now. if the market could see through the fog of the fed, because he can't see the stars at night, then maybe we'll see the market rally. >> picking up on his lovely metaphor there. tim, i miss you sitting here with me, tim.

>> ty, i appreciate hearing that. >> just not the same, man. >> if i could hug you through the phone lines here, pal. so any way. >> virtual hug, that's fine. >> i guess i listen to all this and what i hear is the fed's not our problem, and the fed hasn't been our problem for three to six months. the problems are the ones that the market was expecting. certainly economists have been expecting. but even the faster money out there, and explains where credit spreads and the consumer -- we heard some of this this week. we'll talk more about this later in the show. that's really what the key system we're at peak inflation, peak fed, peak rates. i think the two-year closing near 508 is a concern for equities but really we have been more fixated on the long end to do our discount rates. bottom line here is i just think what we got out of the way today was at least some concern that the fed could be a bigger problem than they might have been. and they haven't been.

that's why the market rallied. the market sold off 5% into this jackson hole. equity repositioning over the last three to five weeks has been extraordinary. we've gone from where we were in july to a place where it allows this rally. and while i'm not wildly bullish on september, i think the market is going higher. >> tim, thank you very much. if you are long or short the market, you can be either one. the chart master has a way to play it both ways. for more, let's bring in carter worth of worth charting. they tell me to get out of the way and let you go. take it away. >> sounds like a plan. thanks, tyler. great to see you. i thought we would look at the relationship between the qqq and the s.p.y. we're going to look at four identical ratio charts. this is qqq divided by s.p.y. there's no drawings, no lines,

no judgments. let's put some in. what you see in the second it ration is that the relative performance of the qs to the market peaked in september of 2020 following covid. so three years later, there is no outperformance at all on the part of qqq. another way to draw the lines of course would simply be to call attention to those well defined tops. then the final way, and this is really the important one, the uptrend, meaning qs have been outperforming s.p.y. for the better part of ten months, we're now starting to break that trend as seen there in the down arrow. that's a judgment, of course, mine. i think that the underperformance continues. so if one is a pairs trader this is sport qqq, long s.p.y., or long only, continued to reduce exposure to large, supercap, marquee qqq-type names.

>> okay, so there is is trade is to short qqq, go long s.p. idea y., or at the very least to be wary of the supercaps. steve, reaction? >> yeah, so i agree to a certain extent. if you're going to play this to rally, first of all, the top constituents on qqq are going to be am, microsoft, and amazon. you could further that out to nvidia if you're looking at the s.p.y.s. you're going to have to own all of them. it's a pick your poison moment and a binary guess. i think the market is probably going to rally, which favors tech. >> what's your feeling as you look at the themes? individual stocks is a area you're less able to talk about, but the themes that carter and -- >> i think it makes sense. if you saw what happened during earnings, which is stocks that beat the earnings numbers are flat on the day. that just shows you expectations

have gotten quite high, especially in large cap tech. they're sensitive to rates. those two things are what are causing that trade to top out and show some weakness. the you look at how this is going to perform going to year end, effectively what you're arguing for here is a rotationing a rotation out of tech and into more cyclicals. our analysis shows when that happens, three-quarters of the time it happens in a rising market. what you would get is market higher, tech higher, but nontech stocks outperforming on a relative basis, and for me that's a less worrisome trade way the think about the trade. flipside is if you had that happen in a down market, that would be market lower and tech getting liquidated. that's not a base case. that's the negative takeaway from that chart. the positive would be high expectations, the stuff really outperformed. we have had a short period of rates rising, which is a bit of a head wind, but ultimately going into the back half of the

year, should be able to perform well, tech up. potential higher cyclicals could outperform. >> we're going to leave it there. we'll be right back. carter, we'll see you in just a minute. thank you as always. we've got a lot of chafrts to go and a chart of the weak. it's friday. that's right, weak with an a, not ee. we'll find out which stock caught our traders' attention. plus, zillow gone wild. the real estate company has a new strategy to bring in home buyers. you won't believe this one, or maybe u wi.yoll stick around the find out. more "fast money" in two minutes.

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... nasdaq 100 innovations like... wearable training optimization tech. uh, how long are you... i'm done. i'm okay. (fan #1) there ya go! that's what i'm talkin' about! (josh allen) is this your plan to watch the game today? (hero fan) uh, yea. i have to watch my neighbors' nfl sunday ticket. (josh allen) it's not your best plan. but you know what is? myplan from verizon. switch now and they'll give you nfl sunday ticket from youtubetv, on them. (hero fan) this plan is amazing! (josh allen) another amazing plan, backing away from here very slowly. (fan #1) that was josh allen. (fan #2) mmhm. (vo) football season is here. get nfl sunday ticket from youtubetv on us.

a $449 value. plus, get a free samsung galaxy z flip5. only on verizon.

oh, no. welcome back to "fast money." time for our chart of the w-e-a-k. shares of nike not coining it this week. up today, but dropping of% since monday. the biggest dog in the dow. the athletic retailer has been on a slump most of august. an 11-day losing streak. tim, you have beenbearish on the swoosh for a whaile now. has this slide changed fouyour d

at all? >> i think still expensive, but also -- has to come down. it has come down. i just feel like we found a place where the gross margins peak in the short run. that's it. it's a fantastic company. love nike. own it with a lot of accounts. tactically that has been a short that makes me feel better about being short discretionary, which i feel has a way to go lower. >> steve? >> nike started downward trend in november 2021, broke it a year later november 2022. started a new downward trend that's a product of all of retail getting crimped here. until this stock bottoms out, i would not be buying it. that's the obvious as a trader. but i would look for it to hold basically that september low. from 2022, sorry.

>> 2022. nike is in part a china story. >> yeah, i think, look, what steve mention second down mentioned is really important. if you think the fed is going to continue tightening, consumer is at risk. nike's a brand, and china consumes brands and luxury brands. i think there's the potential here that the stock has been under pressure because of weaker china spends, which is impacting european luxury as well. this is a broader story that i think has u.s. consumer takeaways as well as china consumer takeaways. >> thanks, folks. coming up next, mortgage rates on the rise, and zillow with a zealous program to entice home buyers. are they creating the next real estate zombies? a lot of zs. no zs around here. we're wide awake. come on back. you're watching "fast money" live from the nasdaq site.

we're back after this. increase

the first time you connected your godaddy website and your store was also the first time you realized... well, we can do anything. cheesecake cookies? the chookie! manage all your sales from one place with a partner that always puts you first. (we did it) start today at godaddy.com

. welcome back to "fast money." zillow launching a new program to give buyers the option of putting just 1% down on home purchases. the financing option limited to buyers in arizona who still have to meet credit and income requirement, but it comes as the 30-year fixed rate mortgage hovers around 20-year plus highs. if zillow keeps stringent standards is this an okay way to help buyers or a catastrophe in the making? >> they haven't given out specifics on the criteria as far as credit or income, but the numbers thrown out there seem very, very low, so i don't think this is a great idea.

zillow, when they got into flipping houses and lost a ton of money a couple years back, now this seems very promotional, very gimmicky. stated what your corps korch ten si is and you'll and a better stock. i don't like the idea. >> how about you, tim? >> i don't love it. i'm long zillow. been long six months. there's been a lot of uncertainty in the housing market. they were cautious on their 2 g guide. if you look at their ebitda it's under 40%. that's why this is an attractive company. but as steve pointed out, they had some missteps. i don't love this move, but i think you have to be cautious. >> reaction, stuart? >> worried me for two reasons. . confirms the challenge with the economy and housing market. experience told us when you get creative on mortgage and consumer lending tends not the end well.

specific on zillow, just generally speaking this worries me in term os what is this testimony or look through to the housing market? >> when should we go for final trades around the horn? let's go with you, tim. >> let's go to the health-care sector, which i continue to think will be very defensive. pfizer has been punished. trading down. levels even preand post peak. spent a lot of money to develop a pipeline. that's more than covid. got to love pfizer here. >> got to love pfizer. grasso? >> palantir sold off. i'm looking for are retracement. i'm long the name. bought it for a day trade. winding up being a couple day trade. looking for a pop back. >> stuart?

>> you need to be hedging equity exposure. the reason is raeeaction to goo news has been weak. you have had higher rates, a weaker china, and pretty bad technical setup. we think it's time to protect your equity markets. >> stuart, been great to be with you. steve, what did you learn this week in the markets? >> i think the fed's time is done for the moment. it was either nvidia or the fed, and they both had 15 minutes of faith. let's move on next week. >> good to be with you a.ll you guys at home, don't go anywhere, because "options action" is next. ♪ ♪

the biggest ideas inspire new ones. 30 years ago, state street created an etf that inspired the world to invest differently. it still does. what can you do with spy? ♪ ♪ power e*trade's award-winning trading app makes trading easier. with its customizable options chain, easy-to-use tools and paper trading to help sharpen your skills, you can stay on top of the market from wherever you are. e*trade from morgan stanley. businesses need 5g solutions today. that's why they choose t-mobile for business. mlb partners with t-mobile to not only enhance the fan experience, but to advance how the game is played. aaa relies on t-mobile's network to stay connected nationwide, so they can help get their members back on the road. and we're helping pano ai innovate, to stop the spread of wildfires. now's the time to see what america's largest 5g network

can do for your business. polyow's the time to see what america's largest 5g network is back now at lucky! come kick off the season with our shop and score game that'll have you cheering for more! play for a chance at over 25 million in prizes and money saving offers - like this and this, or even this! or try to win $100,000 in guaranteed prize money. shop your favorite brand sporting the monopoly tag for unlimited game tickets and get ready to win at lucky!

right now on o.a., is the glass half full or really half empty? the markets went with full for today, but other signs show more and more cracks in that glass. we are designing an options arc in case there's a small flood. then, one of those cracks is the still burdened consumer william data out next week we will look

at one grocery play that could help clean up on aisle four and finally, swing and