making its way to the long end of the curve, as well, as you say, the sort of idea of heavy supply for -- as far as the eye can see in term of treasury issuance >> mike, we'll see you tomorrow. and viewers, we'll see you tomorrow, as well. all the major averages finished the day lower. that's going to do it for us here at "overtime. "fast money" begins right now. morgan, thank you very much. and live from the nasdaq market site, this is "fast money. and here is what's on tap tonight. stocks stuck in the mud as investors count down to tomorrow's fed decision. chair powell expected to hold the line on rates, but with energy prices surging, housing slumping and the consumer a bit on edge, could rate cuts come sooner rather than later we'll debate that one. plus, deal delivered instacart getting a solid bump in its debut as a public company, but its $14 billion valuation a far cry from its pre-ipo peak of nearly $40

billion. what happened there? we'll dig in on where it could go from here and later, inside rh's distressed stock slide shares of starbucks lower. and the options action for fedex ahead of its earnings report good afternoon, everybody, i'm tyler mathieson in for melissa lee. upstairs -- >> it's so good to have you. >> the light looks great on you. >> what do you think of this >> spaceship >> great light for you >> a lot of empty space here that we're going to fill with quantity con tent. on the desk tonight, tim seymour, you just saw him, karen finerman, guy adami and mike khouw, thank you for joining me. we start with the countdown to tomorrow's fed decision. stocks closing off their lows of the day. however, as investors await the outcome of the central bank's latest meeting markets all but certain we're going to get a pause tomorrow. a skip meeting still, bond traders are looking for more hikes in the month to

come the yield on two-year treasuries posting their highest close since 2007 so, what do these moves tell us as we head into the tail end of the year guy? why don't you go first >> tyler, great to have you. we play this game from time to time if you told me this, what would have happened? t ten-year yields today closed, i would have say, the s&p down 75 handles, easy, given where things are we actually rallied 30 handles off the lows today and closed only down ten points, which i think is remarkable. to me, it's all about yields higher yields are not good, it does not suggest the economy is getting better it suggests there's not demand for our debt and inflation is -- >> that supply of debt that's coming online, that is doing nothing but putting a floor under interest rates, right? you have to bid up the price >> i believe that to be the case i don't think it's particularly equity friendly, either. >> i think the long end has technical dynamics i brought up the bank of japan,

the jgb yields with guy 100% in terms of what the price action was like today. it came on a day, though, you could have also thought maybe there was some downward pressure terrible housing market data i don't know that it moves the bond market dramatically, but housing starts, multifamily, which has been the life blood of the housing market for the past five years, and which make a lot more sense in terms of a zero interest rate environment where projects are profitable, and i just think the housing market is starting to show some cracks it's not a runaway train, but it's something where you have to watch it cpi in canada this morning, to the extent that we love our friends up north and, yes, we look at your cpi sometimes and it remains kind of sticky. so, i thought the response of the equity markets was interesting, as well, especially when you consider where we have seen the correlation to yields and equities and i mean at least over the last few weeks largely, we've had this commentary, we had it last night, our equities whistling

past the grave yard of interest rates and certainly forward pe on the s&p and what not. stocks are resilient here. >> karen, walk us through your fed think right now. if we had this conversation a year ago, there would have been a certain category of individuals who would have said, well, by this time next year, ie right now, 2023, we're going to be looking at the fed cutting interest rates nobody's saying that today >> right i think -- i mean -- >> it's a '24 thing if it's a '24 thing. >> right i think that we're -- so tomorrow is sort of priced in they do nothing, that's most likely, but i don't think it's over i don't think we're at the end, to your point, so, if we're not at the end, then we can't be at the beginning of cutting so, i think we're going to be, you know, in this higher for longer camp, and so i don't think the market is fully repriced that risk equity premium. but on the other hand, some tech stuff hangs in pretty well, right? the big tech names hang in pretty well. so, we've got a lot of cross currents here, the consumer feeling stretched, oil has had this kind of quiet, really big

run. >> $6 a gallon gasoline in california >> i actually say a seven, i was there this weekend seven and change i guess people will pay it, i don't know >> were you filling up gas for your lawn mower? >> no. why? >> see karen mowing the lawn out there -- anyway. no, it's interesting, because i think the gas dynamic is something else along with what's going on with the auto strike and what's going on with student loans. the fed has got a lot of things to contend with here, especially in terms of growth, and it's -- it doesn't make the -- the calculus simple. >> as karen said, a lot of cross currents here. mike co mike khouw, you in the land of $6, $7 gasoline, what are you thinking >> $6.29 a gallon at my closest chevron, i'll just give you that little tidbit, i don't know what it costs everybody where you live, but yeah, we're dealing with some pretty high gas prices high gas prices, high home prices, coupled with high

interest rates -- you obviously have a very pressured consumer here and i think actually those are the two competing forces that help us understand how equities behaved today. the reason we saw us come off of those lows was that that is kind of the behavior you would expect if you're expecting a pause, because you have those two cross currents going on. you have a pressured consumer, which is deflationary, arguably, but you do have higher prices in terms of energy and things like that obviously the housing numbers that tim was just talking about, that's not surprising. we have just in terms of median home prices to income, they're at record highs, and you couple that with higher rates, certainly, than we are used to over the course of the last decade-plus, then you're going to have obviously a very pressured housing market, and i think that's going to persist for some time. >> let's break into this conversation with some breaking news on the clav owe ipo shares pricing at $30 a share. that's above the expected range of $27 to $29.

leslie picker has more hi, leslie >> hey, tyler. that's according to a source, the ipo at $30 that implies a fully diluted valuation of about $9.3 billion. that's about in line with where this company raised two years ago, so -- little change from those levels i'm not sure at this time the actual offering size i haven't been able to confirm they still plan to sell 19.2 million shares as is laid out in the prospectus or if they have any plans to upsize it at this time but they have decided, according to one person familiar with the matter, to price this deal at $30 per share, above the range that they had been marketing, which was boosted yesterday, relative to the initial range that they had been marketing so, above a range that's higher than they initially set out toll raise, tyler >> so, $9.3 billion valuation,

did i hear you correctly on that >> 9.3 >> let's trade it, folks what do by think here of clav owe at $9.3 billion? >> first of all, it came in well above the range. and the price talk was $25 to $27, if you think about the arm ipo, the success of this was racing it successfully what we saw during the go-go days of '21 is that these things were, you know, whether they're priced successfully or not, they went through the roof. this is an interesting dynamic the fact that shop if i owns 11% of clav owe, people are watching for knock-on effects there again, it's been -- it's an exciting story backdrop for what's been going on in the ipo market -- >> the market was closed >> i wouldn't get too worked up. in a case of a couple of the deals, they were highly telegraphed, we were expecting them in the case of arm, very few other guys that could have come to market the way they did >> nasdaq at $51 think about what's going on here over the last couple weeks

nasdaq at $51, given the acquisition they made a few months ago, given all the things that are going on, this stock should be north of $75 it's undervalued, it's been under pressure i think unjustly so. if the calendar starts to open up, nasdaq should win. >> thoughts on clav owe or -- >> you know, we've seen -- so, paid to be in arm first day, paid to be in cart first day i have to assume this will happen, as well. if you look what happened to where arm opened, traded up to and where it is now, you would have lost a fair amount of money. same with cart today so, i don't know, these are high flyers -- great if you can get some and then quickly sell it. >> where are these stocks going to trade six months from now, a year from now, most of them trade lower. most of them trade lower which is -- >> that's why they're coming to market, tyler. the good guys already bought it. >> all right, let's turn back to the market, get more now from mike schumacher, glee ball head of macro strategy at wells fargo security welcome, mike.

>> thank you, tyler. >> what do you think, as we look ahead to the fed tomorrow, any blazing insights there, are you expected to be a skip meeting? >> fed's not going to move tomorrow, but it's challenging for powell, he's got the press conference he wants people to think the door is still open, maybe we'll hike, maybe november, december, you have this government shutdown which is kind of a complication he wants to make people think that's still in play, but not actually hike tomorrow it's really a tough line to walk >> he's got inflation moving in the right direction for the most part over the last year, but what if it doesn't get to that target that they have been so articulate about, 2%, 2%, 2%, but it stays somewhere above that, 3%, 3.2%, 2.8%, something like that. >> that's a really bad scenario for the fed and other central banks, as well tim mentioned an ed canada, infn there. the question becomes, what does the fed do

not tomorrow, maybe in a quarter or go two, if inflation has come down a little bit more, but it is sticking at 2.7, 2.8, does it renew hiking does it try to jawbone it down it's a tough problem i'd say that's the nightmare scenario >> are you in the higher for longer category or not >> at this point, i you this it's less about when the fed actually delivers a rate cut, and more about when it signals that we're done hiking and there are different things for the markets, so, we're verve much in the camp the fed is about done hiking, whether it happened in july or perhaps it's next month or november, rather, who can say, but somewhere in there, it's not so much about the first rate cult. 6 v not necessarily fleeting some of the arguments you hear from folks is lock in some of -- some of that yield, because there's reinvestment risk as the fed falls out of bed >> still true, tim, but last

time i was on the show, a month, month and a half ago, i said, buy short-term, but also longer term bonds, we're sticking with that call. ten-year vtreasury gets down to 3.50, it's looking like a braver and braver position, but we'll stay there and the reason again is once the fed really didn't mate intimats >> 3.5%, i hear what is $4.36 in ten-year yields tell you today >> tells me the market's not looking at my notes. you have to read it more carefully next time around i think the supply issue has been a concern for people. and really, it's the notion that it's not just the fed, but so many central banks are rook looking to move policy at the same time. people in tin vesti the investi they need to see tangible from the central banks. hey, we're just about done the ecb delivered something like

that last week if the fed were to do something like that, not tomorrow, but fairly soon, that would make people more comfortable. >> karen >> the supply thing, though, i think is relevant further out the curve, obviously, but if you look at some of the factors, we were talking about oil since july, oil is up a lot. how can they -- i think it's -- i think our next inflation print is actually going to go the wrong way, which i think would put more pressure on the fed to not be at the end. >> yeah, that's tough, karen it's a good point. when you think about things like oil going up, most important price in the world you can't ignore it. you can't say, well, it's not part of core inflation, that's a little too simple. and your average american says, hey, i eat and i drive my car, those are the things i care about, if i paid 7 bucks a gallon, that's a bad scenario. so, the fed can't dismiss it it's a pretty bad look at the same time, the fed can say, hey, look, labor conditions have softened a little bit the market's not as tight as it

was. that's probably a good thing not saying more people need to lose jobs, but still, you need to have hiring become a little bit easeever and that's probably a more long-term fundamental factor so, again, the fed is really trying to thread the needle here if oil does keep going up, it's going to make it tougher >> where do you think the ten-year yield is six months from now >> again, we're calling 3.50 at the end of the year. i'd say mid threes, not very different from our year-end call but it really hinges on the fed signaling not so much the first rate cut is imminent, because it probably isn't, but we're done with hiking. that nightmare scenario we talked about tyler, inflation gets stuck, then the fed doesn't really have a lot of room and tens are probably higher >> and a lot of central banks that have decisions coming up -- >> this week big week >> it is >> so, you're going to have a lot to process a lot to digest. >> that's right. ton of news, really, over the next two days. you've got the fed, bank of japan, bank of england, various

others a huge amount of news. and if they go the wrong ay, i probably does put upward pressure on bonds. >> mike, thank you let's trade this what are the opportunities here? >> everything i'm hearing from this conversation tells me to be careful about consumer spending. if oil prices stay higher, this was a fascinating day. we talked about the dlaur, which h has been rallying along with oil. this is going to bite into the same consumer that's buckling under student loans and auto loans and some delinquencies, and the oil market, which also has the politics behind it there's a deal today between the u.s. and iran on a prisoner swap, there's some discussion that irani oil is making its way around the world rapidly at 2 million plus barrels a day this is the kind of stuff that's feeding into the geopolitics of these markets right now, which aren't easy, either. but all the things we just discussed are not consumer friendly higher rates, higher gas that's the part of the market

that i think you got to be very careful about. >> mike khouw, what's a smart place to put my money apart from money market funds, which michael schumacher just talked about, being a good place to sort of hang out for awhile? >> well, i think that is a pretty good place to hang out for awhile because, i mean, you're earning a pretty good rate you can get 5% plus, that's actually one of the first times you're going to be earning rates that are higher than sort of the core rate of inflation, at least, and, you know, if we do get into a situation where rates linger at high levels or go higher still, then you have to start questioning equity valuations and if you start seeing some recessionary pressures, as well, on the back of all that, then you could start seeing the earnings dropping a little bit, as well now, we're -- we are still long stocks, but you know, higher oil prices, one other point i would make here is, of course, we think about gas prices, but those higher prices percolate to lnl everything else.

inputs transportation and brake costs, feed stock, so, that has implications, as well. we can't ignore high oil prices and the implications for, you know, prices in general, as we look at them >> it's one of the reasons why i've always had a bone to pick with this idea of core inflation, where you take out the two things that are probably most core and -- >> and most inflationary >> and mike makes a great point, it's not just the price of gasoline or the price of heating oil, it's the price of the feed stock that goes into the plastics that i -- it's the price of transportation that's going up, it's all of the secondary sort of input costs -- >> by the way, if tyler has a bone to pick with someone, i'd be running the other direction he's a bad man >> bad man but a good man >> great man >> final thoughts -- >> people watch business tv and they say, you guys are talking about 3% inflation what are you looking at i mean -- >> it's not me >> it's probably two or three times that for the average

american and it aggravates people and quickly, not that i want to go down the rabbit hole of japan, but there's a problem here, and their currency weakens daily. they're going to do what they can to support it. >> it's not going to work. dollar strengthens against the yen, that's going to have ramifications for us here. >> final thought >> i am concerned about the consumer, however, i'm always long just going to have to ride it through. >> all right, folks, coming up, should instacart be in your cart the grocery delivery company making its nasdaq debut today, and no first day jitters on this one. can it keep up its momentum? we'll get some answers next. plus, we're bringing you the options action on fedex. results due out after the bell tomorrow, so, is this transport trade ready to lelidever? don't go anywhere. "fast money" will be back in two. we're not an airline, but our network connects global businesses across nearly 160 markets.

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welcome back to "fast money," everybody. instacart making its debut today on nasdaq. shares of the grocery deliverer are company closing more than 12% higher than the ipo price of $30 a share. but that was a far cry from the opening trade of $42, so, it came back to earth just a bit, so, what do you make of the seeming loss of momentum here, tim? >> it's, again, it's a concern

we knew there was going to be a lot of hype around this. this is another one of these companies that people had been expecting, and there's a real business there, there's absolutely -- and i think the way they priced the deal was supportive, but you know, the marginal dollar for a company like this at a valuation that's not a giveaway, i think in this tape is challenging. so, there's always excitement around an ipo market and the book runners did great job here, because you can see the pop it had. we'll see what it does tomorrow. that's really going to define this >> prices at 30, opens at 42, goes to $42.95 and ends at $33 is that a good sign? >> no, i think it's not. i mean, it would have been better if it opened at $33 and stayed at $33. >> toss a ball up and you smash it >> right you know, ill guess sort of tells you, you have to be the first one out. same in arm, right very early on, that run at the end of the dashgs y, but early,s one out. guy loves nasdaq --

>> stock should be doing better. at least instacart, tim's right about valuation stuff, but you have make a reasonable case that maybe 3 1/2, 4 times earnings, it's not ridiculous in the environment we're seeing on the flip side, arm, which has done 2.5 to $2.75 billion a year for the last three years, at one point was trading around 25 times revenues it doesn't make any sense. great company, greatest ecosystem of all time, i get that there's a price for that, it ain't 25 times revenue. >> are companies just rushing to market now, mike, because they see the window is opening here a little bit, and it's a little wider than it was, so, they're coming in? what -- how do you analyze what we're seeing >> i think the opportunity for issuance, i mean, look, we haven't had a lot of it, so, there's really been a lot more on the demand side, and so, arguably, there would have been better times to come to market

in the last 18 months or so than today. you know, as far as instacart's valuation is concerned, we're looking at a buck and a half a share, maybe a dollar 80 next year, that's not valuation as an issue. right now, there is an ample supply of stock. a lot of people who hold it are selling. and take a look at how if traded, from about, as soon as you basically started trading today, versus the s&p, you can see they went in opposite directions even as equities were doing okay from 1:00 p.m. into the close, this thing sold and then closed on a dead low, so -- i think that they're probably would be cheaper places to buy it than the -- >> where we are right now. tim? >> i would say, it gets -- as mike is talking about supply and demand of new issues, there are a lot of hedge funds in the business of doing this a lot of investors are excited about new issues the size of the intraday market cap got close to $15 billion you can pick whatever valuation

on a sales multiple you want to put on this and see what holds, 660 million of stock was sold today, which isn't massive, in other words, if you think about the free flow, the size of the economy, it does lead you to believe that there's still a little bit more, i think, not a ton of supply out there in this wurngs and i think that's going to support the all right, a lot more "fast money" to come, here's what's coming up next knock knock. it's an earnings delivery. fedex gearing up to report results. so, how should you trade the transport? the options action in that name next plus, a chip check on intel. the company making some major hardware announcements at its latest innovation event. the semi specifics ahead you're watching "fast money," live from the nasdaq market site in times sar 'rba right after this.

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all right, welcome back to "fast money. fedex gearing up to report earnings after the bell tomorrow that stock up more than 44% this year so far. and options traders are betting that this one keeping on delivering mike khouw has the action. tell it to us, mike. >> yeah, so, fedex traded more than three times its average daily options volume today right now, the options market is implying a move of a little over 5% by the end of the week after they report earnings calls outpacing puts just slightly the busiest contract were the weekly 270 calls we saw over 4,300 of those trade overall. that included a purchase of just over 1,100 of them for 60 cents. the buyer of those calls was betting that the stock is going to pop after earnings. this is a name that we own it is trading at a less than market multiple. it is trading at above average

multiples to itself on a historical basis and we should remember that one year ago, they reported earnings, same quarter a year ago and it was one of the worst they had reported in decades, so -- obviously as a holder, i'm hoping this options trader is right. >> yeah. all right, let's trade this one. karen, take the first whack. >> they'll move together with u.p.s., for sure fedex has had a turnaround they did, you know, fred smith left, they have new ceo, who had been there a long time, so, wasn't a big change, but he did seem to have a sense of urgency and the stock really improved. but i think it's really about the consumer somewhat, huge pandemic beneficiary if that's slowing, i think that won't be great >> quick thought >> i like it they benefitted from u.p.s.'s teamsters issues we talked about the multiple it's not something that scares men. let's just be clear. if the recession that everybody says is coming, fedex tends to

be a leader, and by the way, fedex has been outperforming the market >> fuel prices aren't going to help >> not going to help and that will factor into their margins, which should come in 6%ish or so. stock's had a run. valu valuations never, ever a concern. doesn't seem to matter, though in terms of eps growth, you got it in spades. >> it's about how they operate the runup energy could hurt margins, which i think might hurt the stock >> all right, for more "options action," be sure to tune into the full program, friday, 5:30 p.m. eastern time. i'll be here you don't want to miss that. i'm going to be here for that. i really am. coming up, the future of semiconductors intel holding its annual innovation confess, revealing new processors and chips what the ceo is saying about the company's next move. the details next. and kristina partsinevelos is going to be here, too. and back to basics does knee doubling down on its

parks and cruise businesses, but will the move be enough to turn the magic kingdom around we'll debate the mouse when "fast money" returns missed a moment of "fast?" catch us any time on the go. follow the "fast money" podcast. we're back right after this.

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always a close call here when we're in break. welcome back to "fast money," everybody. stocks closing hower as investors await tomorrow's big fed decision, or not the dow falling 100 points the s&p and nasdaq dropping about 0.2% eli lilly announcing lawsuits. the drug maker accusing businesses of selling products claiming to contain terepatide -- >> sounds good to me >> go with it. >> own it, ty. >> own it. the active ungradient in the diabetes drug mounjaro, which is expected to be approved for weight loss later this year.

eli shares are up 57% this year. mounjaro a big, big reason why meantime, intel shares dropping as its innovation event kicks off. the recently outperforming semiposting its worst day since june the ceo speaking with cnbc about some big hardware announcements. kristina partsinevelos has more on the call and all of it. kristina >> well, he actually started the event with some push-ups on stage and afterwards, he proceeded to give a demonstration on a laptop and create a taylor swift-like song. the point of that is, i know everybody is distracted by the video, but the point of demonstrating with the laptop is that intel wants to bring a.i. to pcs that was the big message with this latest innovation, more of a developer conference, and what he said, the intel core ultra processors, they're going to have a.i. capabilities in pcs, like with dell or hp, as soon as december 14th, with next

generations available in 2024 as well as 2025 so, it seems like they're on track. there's a few other announcements, collaborations with companies, and yet the stock is down. the stock has been lower all day. it actually fell throughout the presentation there's a few reasons. first, a lot of hype around this event, a lot of it was expected. there was no unexpected news you also had the cfo commentary said gross margins will expand, but may not be hundreds of hundreds of basis points next year noting the startup costs are very high, when you're building a foundry in the united states, when you're creating all of these new chips, five in the next four years, and then the other point, too, there was no comments about their potential or upcoming foundry customers, who is going to be using these fabs in the united states? our jon fortt was able to speak to the ceo just about an hour ago, and he talked about those high costs listen in. >> the market has worked through

a lot of inventory issues. those we believe are largely behind us on the client side we said we still have a little bit more work on the networking and the data center side for that but of course, this is an expensive journey. >> an expensive journey, indeed. it's not even clear who is going to be using these fabrication plants >> well, they said that they have already secured a big -- a customer for 18-a nodes, but no details. that was some of the expectation, that we were going to get more details on who the customers were going to be intel wants to ks to compete wi- >> yeah, who -- >> that's why intel has been doing well, because of esca escalations with china maybe if apple, if china goes to b ban apple or something similar, you would have to recruit the

supply chain back to the united states and a company like intel could benefit. >> let's trade this one. what do you think? >> well, i'm long the stock. it's only intel could trade down when talking about a.i it really does seem to be a disappointing dynamic. they are -- the fact that they are getting stuff out there for the holidays, i mean, whatever that means, it's not like you're looking for one of these under the tree there are corporates that are out there that are saying they're actually using the new intel chips if their large language models, like alibaba, that was making these comments at the event if you think about the things that are going on in this country, including strikes and what not, and you think about this administration's build at home or near shoring dynamics, this is a reason to be supportive of intel. the amount of government support for a lot of the cap x they will need, we heard all about it. we knew intel was going to be spending this kind of money. i'm surprised at this reaction the amount of cap x they've talked about is something that shouldn't surprise people. >> karen >> well, i mean, if you look at

what the semiconductor index has done versus the stock, the stock has done well. it has to be because of their u.s.-ness, but -- i don't know, i just feel like the stock is cheap, but it has been cheap for awhile i think i would rather buy it higher after they've sort of proven they've gotten their mojo back to me, it's not -- the business isn't the same -- >> sort of a show me mode. from missouri there. >> apparently, yes >> mike khouw? >> yeah, so we don't happen to own intel, but i will say, kind of to tim's point, i mean, this is a company that was on the wrong track and they're on the right one now. pat gelsinger is a second nothingist, he is an electrical engineer the company started to fall back relative to its peers, no offense to bob swan, necessarily, but you have to innovate continue sli, and that's, i think, what they're trying to do right now, and i think, you know, as far as the relative performance versus the semiconductors, we would expect it to start seeing a little bit

of outperformance, because it underperformed for a long time we do own micron, which is more memory than this space, but i think this is a company that's on the right track, though maybe it isn't the time to buy it just yet. >> push-ups on stage why would you do that? >> why have you never done that? >> because he can't. >> just dropped and done a couple >> she said that out loud. she thought it and it -- >> unbelievable. >> not much here, the distance is short. >> are those even push-ups are you watching this? >> let's see -- i missed it. >> i'm sure he's a lovely guy, but i have to tell you, that's a bit of a johnson move. >> i'm joking, by the way. i'm sorry. >> i know. kristina months ago pointed out, intel's positioned themselves as a homeland security play and the move we saw today, you've seen three moves of the same magnitude since february. $25 stock, a selloff happened in april, again in june, and again in august.

and we're seeing it now. it's lower left, upper right, valuation reasonable, they figured it out and if you give them a higher multiple based on the fact it this is homeland security thing, stock should go higher from here >> now drop and give me five >> yeah. >> that's a demand by the way, you see this thing in inthe middle >> don't -- don't get the camera -- i don't want people to see that >> it's a caldron. >> kristina, thank you. coming up, disney doubles down why the entertainment giant is betting big-time on theme parks and cruise lines. and later, starbucks shares on ice. one wall street firm downgrading the coffee giant and sending shares dropping, as you see there. we'll bring you the details and the trade ahead. c nbc is celebrating hispani heritage here's the founder of all mines count. >> i find that many latin x grow up in america trying to fit in,

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welcome back to "fast money," everybody. has the magic left the magic kingdom? disney shares dropping as the company announces to nearly double its planned investment in parks and cruises. those businesses double to roughly $60 billion in cap x the division has been one of the bright spots for disney, which has struggled with its streaming and media businesses, but domestic parks have seen a slowdown in attendance, as well. mike khouw, what do you make of today's announcement >> well, you know, i mean, if we're talking about discretionary spending and that's what essentially you're relying on in that part of the business, i'm a little bit concerned, i have to say, because i think consumers are

under some pressure. we did see them sort of step back a little bit from some ticket price increases that were not that well-received so, i think that, you know, you're making an investment in an area where your ability to increase prices is limited, and that just reflects on the consumer's ability to spend additionally you know, years ago, the reason to buy disney is it always had this money printing press of espn running in the background, and that represented 40% of the value of the shares when you looked at it but that isn't the case. we're seeing a lot of competition, especially in sports programming you know, you take a look at youtube's participation with the nfl sunday ticket thing. i feel like they're getting pressure on all fronts. >> karen >> well, they are getting pressured on all fronts. this is $60 billion, it is over ten years. their last -- i think it was $4.9 billion of parks cap x, that's a big percentage jump, but -- >> not all that much >> not all that much >> a billion one on their run

rate of revenue. >> but the parks are doing well and have done well, and, you know, for them to think ten years out, that makes sense. you have to think when you do the kind of projects they do what of course comes up is, wow, they're spending a ton of money. they want to buy hulu, that's going to be another $10 billion, they have a lot of debt from fox. i don't know what they'll get -- >> what they're going to get for abc, who knows >> i don't know, the balance sheet is a bit stretched i took a foray into disney after the last earnings call lost money, i'm out. >> i -- i just -- seems like the comments they're making are really working against them. and i realize this is a regulatory filing, it's not like they're out there, having a big conversation with markets. i agree with karen, i think parks, which were $32 billion of operating income deserve it. this is 60% of ebitda, and this is, i think, highlighting just how valuable this part of the franchise is it does seem like disney is, in terms of their negotiations, if you're a company that's out

there and has to buy something when you talk about, you know, this kind of a cap x spend, or the places where they're actually selling assets and linear tv and it seems like they're talking down the value of the assets doesn't make a lot of sense a guy that is long disney stock, i feel like the black bear on the loose today was maybe the bigger deal. >> was that the country bear jamboree >> your favorite ride? >> third favorite. mr. toad's wild ride and hall of presidents >> pirates of the caribbean is good >> you like that >> more your speed >> absolutely. >> the hall of presidents, you can be there alone >> i wait on line over and over again to go there. >> there's no line >> there's no line >> all righty, coming up, everybody, pumpkin spice problems starbucks shares dipping lower here stick around for that trade and more when "fast money" returns

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welcome back to "fast money. a bitter day for starbucks, sharing dropping a percent and a half after td cowen downgraded to a market perform from outperform the slowdown in china could have venti-sized implications for the stock.

oh, that's nice writing right there. our kate rogers has the details. hey, kate. >> how many puns can you fit in there, tyler hi starbucks lower today on this downgrade from td cowen from outperform to market perform about its business in china. analysts say, we like the long-term story, but move to the sidelines as we monitor china dynamics, pointing to the pressures there. it says it was pleased with the company's performance in china in june, but has concerns that the headwinds are set to increase, rather than ease up. last quarter, same-store sales in china increased 46%, as the company lapped some major covid lockdown us. this downgrade comes as starbucks announced the opening of a china innovation coffee park an hour from shanghai it is a global first for the company and its largest investment in a manufacturing and distribution center outside of the u.s. at $220 million. the center will support the company's goal to reach 9,000

locations in china by 2025 it has about 6,500 today back to you. >> and what is the total store count, do you know, globally >> off the top of my head, i want to say it's over 30,000 >> i read it was -- that's just amazing to me. >> yeah, might be 36k, yeah. >> let me just point out that one of the great people in the world is guy adam mip, because he brings me, when i come here, a venti vanilla iced latte decaf. he texes me before i come in and asks me what i -- this is -- >> this is the kind of guy he is >> tim's been on top of this i'm say a couple things. a high price start on the street of $150. that's ridiculous. the downgrade took the target down to $107 still expensive. the average price target is $113 $95 is a line in the sand in terms of technicals. if there's a slowdown in china, it does not deserve a premium valuation to the broader market. i think the stock continues to go down. >> tim, quick thought?

>> i think guy got me a venti this afternoon and milk in mine, but i tell you, i -- the chart's going to $85 and i will be adding more. china is 16% of ebit i think their bigger issue is u.s. is. >> 85 will get you a couple of ventis >> they ain't cheap. >> no, that's the problem. >> meantime, retail stocks in the red again today. dollar tree, dollar general, macy's, etsy touching multi-year lows while the xrt retail eft closed just barely in negative territory. down nearly 10% in the last two months with the holiday shopping season just around the corner, can you believe it, what does the weakness mean for retail karen, take it away. >> well, talking about the consumer being stretched all along. but i think some of them might have bounced today target bounced, etsy bounced well off the lows. it is very asset-light

i kind of like that. i'm optimistic macy's, i believe, is low single digit multiple of earnings -- earnings, not -- i mean -- and it's not distressed. >> no. i hear you on that, though macy's has proven they can trade in a mid-single dingit multiple that used to be when we're very worried about the balance sheet. i have no position there it's interesting but what i heard on the delinquencies doesn't make me feel great and this holiday season is going to be uninspiring. >> uninspiring mike, are you inspired by any of the retailers, including macy's? >> well, i mean, it's trading -- as they just pointed out, single digit multipulls, but maybe not this low i've been negative on the consumer, and they are stretched, we are seeing rising delinquencies, we can see that in auto loan rejections and a lot of other places, but it

seems like consumers tend to reach into their pockets around the holidays, so, i think if we're going to get a surprise, that -- that could be it, actually, so -- i have a feeling it might be a better buyer than a seller here. >> all right, mike, thank you. up next, we're going to bring you some final trades. ♪♪ we're not writers, but we help you shape your financial story. ♪♪ we're not an airline, but our network connects global businesses across nearly 160 markets. ♪♪ we're not a startup, but our innovation labs use new technologies to help keep your information secure. ♪♪ we're not architects, but we help build stronger communities. ♪♪ we're not just any bank. we are citi. ♪♪

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all right, time for our final trades let's go around the horn, beginning with mike. mike >> yeah, fedex we own it going into earnings. revenues are the things you have to keep an eye on, though. >> tim, how about you? >> first of all, thank you for being here >> hey, i'llsee you later in the week >> great show. appreciate it. >> thank you >> guy, good look at the house of presidents. because i realize that -- the cap x here, this is an overreaction disney has other issues. this is not their issue. you buy that weakness. >> all right, karen? >> yeah, i'm always long, i have some hedges, but i have one other asset, which is one-year treasuries i think the risk/reward is compelling >> we began the program. all right, guy -- >> i'm sure -- i've never met pat, i'm sure he's lovely. two push-ups on stage, sort of embarrassing you would have rattled off 50.

because i know that's who you are. >> that's right. >> one arm, no less. >> sllone. i mean, stallone, tyler. oracle, old tech back to you. >> old tech. all right. thank you for watching "fast money," everybody. you know what's coming up next that would be jim cramer and "mad money," it starts 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 help you find it. "mad money" starts now hey, i'm cramer. welcome to "mad money. welcome to cramerica my job is to entertain, but to educate and teach you, s call me at 1-800-743-cnbc. or tweet me @jimcramer. you see gloo