gerard cassidy, you know, those banks kicking off earnings season at such an important time where there are so many questions about the market. appreciate you joining us here on "overtime." >> thank you, jon. >> we get those numbers again tomorrow morning. for now, that's going to do it for "overtime." "fast money" starts right now. live from the nasdaq market site in the heart of new york city's times square, this is "fast money." here's what's on tap tonight. a late-day selloff. major indices breaking their four-day win streak, sliding in the back half of today's six. stocks closing off their lows of the day, but still posting their biggest losses in over a week. what sparked the direction change? and is it a sign of more pain ahead? plus, bank on it? the financials kicking off q-3 earnings season into high gear, starting tomorrow what they could say about interest rates, the consumer, and what's in store for the markets for the rest of the year. and later, delta, attempted rally hitting some turbulence.

engine trouble at ford, and a fast mover. a name we rarely mention on the show. the stories behind three stocks today. we're coming to you live from studio b at the nasdaq. on the desk tonight, we have tim seymour, dan nathan, guy adami and our special guest trader tonight, kristen bitterly. welcome to everyone. we're going to start with the late-day selloff. the dow falling as much as 350 points at its lows. the nasdaq and the s&p down as much as 1.2%. the indices closing off their lows of the day, but all three still snapping a four-day win streak. the pull-back colliding with that 30-year treasury option that showed weaker demand. jumping back to nearly 4.9%. all of this as wall street was digesting the latest cpi data. consumer prices rising 3.7% in september from a year ago, slightly more than the street estimate. energy, used car vehicles, prices falling, but it wasn't enough to offset the gains in

things like food and shelter. so, how should the market be digesting all of these data points, guy? looked like the market was going to be a little bit okay with a firmer cpi. >> first of all, great to have you. >> thank you. love being with you. >> it's serendipitous that you're with us, because i said -- >> the dollar had a five-week jump today? >> think about the move in currency. think about the move in the bond market. a 19-basis point move today from low to high, which is remarkable in the context of everything that's taken place over the last week or so. that's the trade. tim talked about this a lot. i still think yields are going higher. i think yields would be dramatically higher, but for what we've seen ore the last week, so, yields are telling you the story. and the demand for our bonds, the market is demanding a higher yield to buy our debt. that is problematic. >> is it problematic, tim? you are a little more, i don't know -- >> sang win? >> yeah, i mean, maybe act kwee

yes, sir sent to the market that i have. and the qs are close to that, actually, they finished with that. but i hear everybody here, and an 18-point move on that auction was a sign that investors are demanding higher term premium so, you get a pickup of ten bips on the ten-year, 15 bips from 10s to 30s. the curve is steepening. term premium, risk premium, and that's something to think about. the core cpi was hotter than expected. we had a week, you had all kinds of folks from the federal reserve talking about, eh, we probably don't need to go, maybe the long end is doing the work for us, but that core showed shelter and core elements of inflation that are going to be sticky, and it's really that duration of higher for longer. it's not about rate cuts anymore. and i think ultimately -- i do think that's going to be bad for equities, but we had a 4% move in the s&p. let's take a deep breath and

understand that markets are -- are dealing with a lot of factors, and i think that's what today felt like. >> we did see the probability for the next rate hike go up to 40% from 30%? >> yeah. >> that was interpretation of the ininflation report. what do you think? >> yeah, so, i think cpi, a little bit hotter than expected, but when you actually break down the numbers, if we look at core cpi x shelter, you're looking at 2%. so, with shelter and services, if we see a path to that actually coming down, you can see, maybe 2.5% by the end of next year, not quite the 2% target that the fed's looking for. but i think the price action today goes back to that 30-year auction. it was all about the 30-year auction. and this debate that we've had the whole month of september, who are the buyers of the ten-year and the 30-year? and there's pressure that rates could go higher there. >> we've had this debate all year, but it doesn't feel like we've had a lot of weak auctions, so, there's been a lot of discussion about who is a buyer, is there too much supply

coming due, but most of the auctions, especially at the short end of the curve, have been gobbled up. what happened today? >> i don't know jack about auctions. but bringing it back to the stock market, if you think about the things that we value stocks on, right? and so, if we've been really focused on inflation and focused on rates, look what we had in the last week. friday, we had an unemployment report at 3.8%. a cpi reading very near 3.8%, right? if you think about all the seasons that should probably put a build under oil and energy in general going forward and the lack of visibility in and around that situation, i think inflationary inputs are going to be higher. going back to the stock market, a lot of corporates, this is what we're going to hear in q-3 earnings season about q-4 guidance, it's going to be a lack of visibility. and you can say they have a mulligan, if you will. we've gotten our arms around the situation with ukraine as that settled in, but the uncertainty with the middle east is going to be here for awhile, and so, if you think about higher

inflation, you think about rates higher for longer, i don't have to say what guy is saying. i don't have to say i think rates are going higher. all they have to do is hang out around here. you mentioned the dollar. if i think about u.s. multinationals and the inputs and the stress that puts on their earnings at a time when consumer here in the u.s. might be getting strapped, i say to myself, the leadership that tim speaks of, they have lots of exposure overseas. because if enterprise demand for a lot of their services and products starts to wane as we get in the new year, stocks trading, the s&p, i think, trading 18 times or so, which is in line, or a little bit above the ten-year average, with rates here and all this uncertainty, they don't make any sense. that to me in this valuation range. that's my 2 cents there, sorry about your auction here, it's not my jam. >> just to be clear, the market went down 120 basis points -- >> you never want to see a whole market move on a weak auction.

>> totally the auction. >> seismic move. >> so, the concern is now about deficits and debts and so now we're demanding more -- >> yes. >> per yield for the safety of u.s. government debt? >> yes. it comes upon a 75-point basis move up until that. i realize the last few days have given background. i think yields are going to go higher term, and i do think, you know, term premium is a big deal, and i do think positively slope yield curves -- >> can you just explain why that's a big deal, what that means? >> it means that you're demanding more return from the u.s. government for investing longer with them. >> not risk-free. >> and it used to be. and when money is free, you know -- we're talking about the u.s. government, folks, it's clearly the best credit in the world, and it will be, in my lifetime, and, you know, i still think that ultimately this is going to be an opportunity for investors to lock in really attractive yields. this is what kris does all year with her team. but the market took back half of

that loss, and i think had a chance to think about it. >> i think just to put it very simply, if you can get yields on the front end of the curve close to 5.5%, two years north of 5%, going back to this concept, who is the buyer? where is the bid for the ten-year? we saw a bid for the ten-year based on the attacks over the weekend, so, it did function as that flight to quality in an extreme situation, but then quickly the market corrected and said, okay if we get these high yields, anywhere from very short builds out to five years, i'm more comfortable hanging out there instead of this uncertainty around higher for longer and what that means for growth. >> and that is your point, as long as yields continue to -- >> uh-huh. a lot of people say, the economy is solid. so, that's one of the reasons -- >> did you see jobless claims today? 209, there's very little signs -- >> the job market is on fire. >> that's a counterpoint. if you have a goldilocks situation, where inflation comes down and the economy hangs in there. >> is inflation coming down?

>> yeah, it is. >> the rate of growth is slowing. people will say, what are you talking about, guy, inflation is back in spades, we're paying more for things. and yes, in terms of rate of change, it's slowing. prices are still going higher, though. they are just going higher slower. i'm not trying to be nuanced, that's the math. in terms of the market, look, right now, the market seems fine with all of this. at a certain point, the same way we're seeing home builders roll over on the back of higher yields, one has to wonder if the same thing could happen in the broader market. >> what do you think when it comes to the good, soft landing story, still boosting earnings and the market? because that's what the bulls argue. >> i think earnings, especially when we look into the pexations for next year are way too rosy. what is it, 12% earnings growth that we see for 2024? if we're in higher for longer that has that impact of earnings. we still see earnings growth going into next year, but maybe more to the tune of 4%, 5%, not 12%. and we have to be realistic. is it a full-blown recession or

just simply a slowing economic growth backdrop? i think that slowing backdrop in terms of pressure on the consumer, given some of the inflationary concerns, we start to see breaks in employment, they just need to be modest. i think that's going to very quickly change the consumer behavior, flow through to earnings and the slowing economy narrative. >> do you think the relationship between yields and tech is still -- >> well, that's a great question. >> that was kind of not happening this morning. >> a little broken. think about this. in late 2021, when the fed said, to battle inflation they are going to raise interest rates. the first things were hit, companies that did not have earnings, even some of the megacaps, when they joined the party in early 2022, that's when the s&p turned lower, because we know the concentration of the top ten names. they've been the beneficiary, right? like, that's the odd thing, i think, that you're talking about. >> yeah. >> but you know, listen, apple, microsoft, they make up 20% of

the ndx, the nasdaq 100 or so. they are down more than the ndx is from its highs. i mentioned this the other night on the show. if there's any reason to sell those stocks, if correlations go back towards one, like we saw in different periods in 2022, they're going to be the leadership on the downside, too. if you look under the hood, we've been talking about retail, we've been talking about industrials, now home builders down 15%. the list goes on and on about the sub sectors within the s&p that are in correction territory. they are saying something other than let's say 10 or 15 megacap tech stocks. >> don't you think there's an element of the free cash flow generation of these companies, as well? i think the narrative, not all tech is performing the same right now. so, when you look at the magnificent seven, i was one of th those. there's a flight to qualify from a cash flow perspective. that's what we're seeing on -- even this week and days like that. >> google's outperformed them all.

and some of this, i think, google, from a free capital perspective, is right there, but apple generates more, at least aggregate free cash flow than any of them. i think apple has kind of stalled in the mud, but i think we should keep in sight that many stocks areone 5% to 10% of 50-week lows. >> staples have been acting terribly. >> the dollar gens, the dollar trees, target, so -- it's not as if there isn't a lot of carnage out there. but there's no question, what everybody is saying here, equities aren't worth as much in a world when the rates are higher. >> so, what are they encouraging? >> i'm sorry? >> what are the encouraging signs to you? semis? >> semis are being priced as growth. and they are being priced that there's actually a megacap, cap-x cycle that is coming through, and that we're going to continue to see that. and that leadership, because of the technicals of the market and passive investing and all the things we've been following for

the last ten years. it doesn't go on forever. that's what i wash every day. if it breaks down, we should be worried until it doesn't. it doesn't and it goes higher. >> for more on what the numbers could mean, let's bring in bank of america u.s. senior eco economist, it's great to have you here at the nasdaq. do you think this changes anything for the fed, the cpi report. >> yeah, thanks for having me on. our take away from the cpi report was, one, it's a reminder that the flpath back to 2% is going to be difficult, and two, sticky services inflation means sticky policy rates. so, we keep our forecast for one more hike. don't have particularly strong conviction on whether that hike comes in november or december, possibly even later, but even if that hike doesn't get delivered, higher for longer, so, it's going to be difficult for the fed to cut rates, as long as services don't -- >> longer than the market expects at this point? >> quite possibly, yes. the markets are pricing about.

>> the argument to that is, we have seen the big selloff in long-term bond yields and that hurts asset prices. it hurts the economy, and that does the work, essentially, for the fed. >> absolutely. this has been a very interesting past few days, because there was a leaning from several fed speakers that, look, maybe we can go -- we can pause, maybe we can go on hold from now on, because of financial tightening. and then you get this cpi number, and it makes you wonder, how the fed really done enough? do they need to do more? >> long and variable lag effects, which we should start to feel now. i'm surprised it didn't happen sooner, but speak to that because historic amount of hikes in an historic amount of time. >> you see in the selloff in rates, a lot of those rates, it

means financial tightening. and housing, which is tracking the first quarterly increase since the first quarter of 2021, that could go into a double dip. business investment has outperformed this year, but there's a risk that might not last, as well, given where rates are right now and what the senior loan officer survey is telling us about credit. >> i'm reading in your note, you think maybe the 80s is a better analogy based on the pace of inflation. what -- what does that mean for the housing market? if you think this is an '80s backdrop, look, i think real estate is going a lot lower. you can't have free money and expect people who overpaid for houses, i mean, the math is pretty simple. >> right, so, it's not the same scale, but if you think about what happened in the '80s, a lot of inflation and aggressive fed response, a large increase in mortgage rates as a result of that, but then, the other thing that was going on back then is that the largest cohort in the

population, back then, the baby boomers, were coming offage. and they were starting families and that kept a floor under home prices. year on year home prices actually never went negative. and this time around, it's the millennials rather than the baby boomers. and so that's a similar story. >> how do you think about the supply/demand balance? there's just not enough supply. and when you look at the numbers, we are still short 4 to 5 million units, and so yes, we have higher rates, which should, you would think that housing prices would come down, but given the supply/demand imbalance, it's tough. >> right. one of the ironies of what's happened is, one, we have higher rates, and two, a lot of households are locked into very low rate fixed mortgages. so, what's happened is, the lack of supply of existing homes has led to a little bit more construction on the new home side, and that's helped housing activity bounce. >> great to have you here.

thank you very much. we're taking the questions on today's data. dan? >> listen, i go back to the stock market. i'm not an economist -- >> you don't know jack about the economy or bonds? >> i know a little bit. >> jack what? sorry. >> the only thing i'll say, think about the most economically sensitive groups in the stock market. i look at banks, how they've traded all year, home builders have joined the party, right? the consumer-sensitive ones, we just talked about retail, consumer staples, they are kind of falling apart. the market reminds me a great deal of q-42021, where every day on this show, and sarah, you used to pop on every once in awhile, you would say, you are so negative, why are -- >> i did say that. >> but i would say tow, you, l under the hood. there was a lot of stuff that was already selling off, already in bear markets, and coming into october, november, before the fed did their about-face, so, to me, i think we're in a similar period, where there's a lot of

masking of bad activity which could suggest something different in 2024 than we've become used to in 2023, which was, again, back to that buy the dip mentality. >> look under the hood. >> wow. >> i know jack about metaphors. >> looking under the hood? >> any gearhead in you, growing up? >> a little bmx. >> guy, clearly, the camara. >> you're safing that because you're trying to put a wedge between me and sarah. i did not drive a camaro. >> i have no problem with that. >> all right, that's fine. i drove a camaro. when we come back, a surprise move from the uaw, speaking of cars. why the ford plant they are targeting could mean a big hit to the company. we'll have details straight ahead. plus, two words -- eras movie. the pop star's eras top hitting the silver screens with huge expectations for opening weekend. how much she could pull in and how she'll be celebrating in the

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we, in the industry, do see it in certain parts of our

industry, on the lower fare side of the business, but we're a very different carrier than those. we got premium, which is continuing to drive the strength of the business. we've got international, which was gang busters. >> that was delta's ceo on s "squawk box" this morning. delta saying profits rose nearly 60% in the third quarter, but forecast full-year results at the lower end of estimates due to rising fuel costs. shares down over 2% today, have been steadily losing altitude since late june. so, how can delta get its wings back, tim? >> well, boy, there's a few puns in there. >> a lot of great writers on this show. >> i think delta really just needs to hold the line on discipline in terms of capacity and keeping costs in line. ed's done a great job here. he also -- he listens to his employees. he listens to his customers. and i think delta's made some difficult adjustments at times when it seemed the right choice for the business and the corporate culture was something else, but delta should trade at

a premium. it, in fact, relative to some of the big three, if you call it that, it does. it's got the best balance sheet of the bounce and there's pricing power in the front of the bus and transcontinental, and business travel is happening. so, it's a frustrating time for airlines because they're trading correlated to oil prices. i think they are the greatest trading stocks in the world. >> yeah, he did do a mea culpa on the changes in the rewards program. people are very unhappy. >> see if they can pull that chart up again. >> can we pull that chart up again? >> sounds like dan doesn't like the chart. >> this is why the stock market can be really stupid. look at the stock, broke out at 35, right? this was in may, in june, and people were getting all geeked up about the summer season, this and that, and where does it top out? right about what everybody's done with their holiday, this and that whatever, and now it's round trip the whole move. it's been cheap the whole way up and cheap the whole way down and you say this all the time and you do trade them well. they are great trading stock.

really tough place -- >> don't marry them. >> doesn't it just depend on fuel prices. >> well, crude, if they -- >> i don't think they can do this. if they overlay crude, crude was ripping -- >> asking for a lot. >> they're kind of dumb. >> you can look at crude, but you can look at the consumer spending patterns, too. there's that seasonality in the summer, but if we take it back to the cpi print that we got today, like, when you're looking at services and what people are spending on, they're trading down, too. they're not taking big vacations anymore. it's more about restaurants and kind of experiences, but not the big ticket items that are now kind of past us and through the system. >> taylor swift tickets. >> i just think that investors don't trust the airlines. we've had decades to not trust them. so, the biggest issue, and the reason -- when they were rerating in 2015 through 2018, it was because we believed in the capital discipline and we leaved they weren't adding to capacity, growing their routes and ending up with empty planes

and higher costs. that's the story of airlines. if they can show they're running better, that's the story. yes, there's cyclicality in the airline business. we know that. but when they best cycle was moving here, they weren't. >> they think there's a lot of pent up demand from china, the international markets that didn't fully open, that business didn't fully come back. >> i agree with that. sticking with the transports, let's move to ford. shares hitting the brake, today as the uaw expanded its strike to the automaker's largest factory. the union telling 8,700 workers at ford's kentucky struck plant to stop. that's where the f-series pickup is made, and fun-size suvs, dan. this is painful for ford, isn't it? >> yeah, it is. it seems like ford's response, they've gone as far as they could. i think we should be focused on the fact that these could go much longer than we think, at a t time when we're focused on fiscal spending. there's lots of things. you could say last week, up 4%

or this morning, i guess, up 4% from the recent lows, that the market is -- what do you say, guy? >> i've never said it in my life. >> so, we have all the headwinds here and the market is trading better into it. but i just see a lot of potential issues here and bring back these strikes to consumers, it's not good. >> full-size, i said fun-size suvs. >> roberto duran, are you familiar with the boxer? >> no mas. >> thank you. >> great boxer, but only remember one thing. >> no mas. at a certain point, people that have been long ford for 30 years -- >> no mas. >> it's going to man any fest itself in terms of volume. and you're going to see a 350, 400 million share day -- >> sugar ray? >> it was sugar ray leonard. the middleweight class. you remember that. >> i'm all over that. >> a bunch of great guys back then. >> oh, really? >> benitez. >> sure. >> more of a haggler person.

>> good for her. >> someone told me to say that. a lot more to come here on "fast." here's what's coming up next. believe in bio tech? analysts giving amgen a good prognosis. so, could this stock be a shot in the arm for your portfolio? the traders debate, next. plus, it's that time of the quarter. bank earnings kicking off tomorrow. and our next guest says there could be some room to rally. the names he's watching ahead. you're watching "fast money," live from the nasdaq market site in times square. we're back right after this. which have become top targets for ransomware attacks. but there's never been a reported ransomware attack on a chromebook. which is why thousands of schools like the fairfield-suisun unified school district switched to google tools for education. so they can focus on teaching and 22,000 students can focus on learning,

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welcome back to "fast money." wells fargo getting more bullish on amgen, in our call of the day. analysts raising the price target to $320 per share from $265, writing that the company's emerging pipeline gives him more confidence in the bio tech long-term growth. guy, you've been watching this name. >> yeah, steve grasso has been talking about it, as well. and amgen, great pipeline, now seemingly getting into this world of eli lilly and novo nordisk, good for them this $295 level we're fast approaching was a prior high. you have to start talking about a stock with momentum behind it. keep that in mind as we get closer. i do think it goes through. >> the horizon therapeutics deal is closiclosing, and that's the headline. i think there's a lot there. and i think there's a lot there on valuation, and it's also -- i do think investors are looking for those megacap bio tech or pharma names that certainly can

be defensive in an environment where balance sheets might be stressed in other places. they're not here and i think they're probably done on the acquisition side, which also means there's less risk. >> right, so the horizon deal, they can boost their long-term earnings power, and not just the obesity pipeline, but torrent cancer drugs, as well. >> yeah, and they've talked about the importance of oncology. they've talked about -- look, the obesity multiple factor, what this means for where they should trade, i'm surprised is h it hasn't done anything for pfizer, but again, they have the oral therapy which will be a driver. >> kris, how does the sector look to you? >> i think overall, the sector has been crushed this year. and you look at earnings -- >> unless you are in obesity. >> exactly. there's been some events, but overall, you kind of have health care more broadly and bio tech suffering in the broader backdrop, and, you know, it's really interesting. it's the one sector, when you look valuations, it is the one

that's actually trading at a discount to the rest of the world. so, i think, like, looking at some of the m&a activity, could you see some rally into 2024? i think absolutely. >> well, also, if you are cautious on economic outlook, it's usually a -- >> defensive growth, which is why people really like it for this type of environment. >> yeah. not so much these days. when we come back, could banks be about to break out? tomorrow kicks off the big season for the financial sector of earnings. our next guest says there could be a bank bump in store. the names best positioned for that jump. plus, putting the fast in "fast money." shares of fast nall leading the s&p after reporting this morning. more on the numbers that had investors piling in, when "fast money" comes right back. missed a moment of "fast?" catch us any time on the god. follow the "fast money" podcast. oror we're back right after this.

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welcome back to "fast money." stocks snapping a four-day win streak as investors digested the latest bond auction and new inflation data. the dow falling 170 points. s&p and nasdaq both down 0.6% off the lows of the session. shares of birkenstock falling 7% in its second day of trading, adding to its first day

drop. stock trading at $37. that's down 18% from its ipo price. and shares of dollar general jumping afterhours. the company appointing former ceo todd vassos to step back into the role effective today. dollar general lowering its full-year earnings outlook. well, speaking of earnings, third quarter bank earnings kicking off jpmorgan, wells fargo and pnc reporting before the bell. reserve-building is more important for the group than earnings beating for this quarter, with investors worried about credit quality and how banks would fare in a potential recession. chris, you expect banks to put aside more reserves for credit losses? >> i do, sarah. i think that's the right thing for them to do this quarter and i think it's a better part of valor to miss earnings estimates and build reserves in this period. >> is that -- that is good, is that clarity for investors that want to own these stocks for them to do that or not?

>> sure. recognizing credit risk is exactly what banks have to do right now. i think the concern is that banks are not inves vestable bee of credit concerns and worse economic activity next year. the solution, the vaccine, if you will, is building reserves, creating new confidence and reminding investors that banks are going to continue to lend and take deposits as they move through the next couple of quarters. >> what about the banking business this quarter? we saw another quarter of higher interest rates, which should help on some profitability metrics, but there are clearly reasons to be cautious, as well. >> well, the higher interest rates are a double-edged sword. deposit costs continue to reset higher and that's squeezing margins. on the other, you have higher rates on loan yields, which continue to remix and help margins stabilize. probably in the first quarter of next year. higher interest rates are actually very helpful for most banks. we think new loans are going on the books at 8% to 8.5%.

still very materially better than the yields that were around 5%, 5.50% last quarter. that's going to help as we move forward. the challenge is that the fed pause can't happen soon enough for deposit rates. deposit costs will continue to go up in the fourth, but we think it's going to stabilize sooner rather than later, as next year develops. >> chris, thank you for joining us. you talked about pricing in and provisioning and the recession and let's presume that the market has done a decent job of calling a mild recession into banks right here, but then how about banks, money center banks tr trading at 50% of a multiple of the s&p? do you think that's warranted? it's hard to go out and buy banks, i agree, but that seems to be getting pretty compelling. >> i agree with you, it's one of the reasons i think the kre and the other benchmarks can really rally. this next three, four weeks. there's no reason you can't get a 10% move or higher in these stocks. for one thing, i think the

market multiple may actually come down. and the banks relative can go up. i've lived my career where banks were hanging out at 75% to 85% relative multiples, to your point, tim, so, i think that's extremely possible. the question is timing. we still have to consider that credit gets worse as next year plays out. i just think the banks will reserve for it and if they have enough earnings and capital to get things through. >> chris, jpmorgan is going to come out at $100, trading at $150, i can do the math. they trade at a premium to a lot of the other banks. but at a certain point, when some of the banks are trading 65%, 70% of book, how does that reconcile itself? i get they deserve a premium multiple, but does jpmorgan's come down, citi, bank of america, wells go up? >> i think it's more the latter, that the pricing goes up for the others that are too inexpensive. jpm is a great franchise. they have a lot of confidence with investors that they'll be the leader throughout this cycle. the challenge is that the other

stocks should not be ignored in favor of jpm. i think you should do the opposite and bid them up. book value may grow faster next year, as the interest rate mark starts to back away and actually come down. it will be negative on the marks this quarter. but next year could be a different story. the fed doesn't have to cut rates for the rate marks to actually start to help banks. we've got natural payoffs, and then any movement in yields downward and pricing getting stronger on the fixed income world, particularly in the residential mortgage-backed securities could be big. >> is that why you like the regionals best? looks like your best idea is fifth-third, new york community, these are been the most pressured from higher rates and potential pressure on reserves coming out into money market funds. >> that's correct. and each of those companies have the ability and the leadership to actually work additional both reserves higher, but also keep lending money. we think there's a market share movement away from certain banks

to these regionals. i think the regionals have been completely ignored and they should not be. many banks are going to pick up share from each other as you move forward, in fact, i actually think the two big fail banks may see deposit share leave as the next year or two play out. >> all right, chris, thank you for joining us. tim? >> well, so, back to guy's point, chris's point, jpmorgan, 1.5 price. city, 0.5. it's trading as if they have a mexico business like they did years ago that's worth nothing -- >> citi's been cheap before. >> this is as cheap as it gets and i think it's getting kind of silly. the regional bank argument is one -- what's the discount put on the regionals? because we never thought money could leave that fast. we live in a world where capital flight and those dynamics -- look, the mark to market on, you know, held to maturity securities is going to be even uglier this quarter than it was last quarter. think about what interest rates have done. think about the negative yields

on those books. i think people are prepared for that. i think that's what they priced into them, but i like city, i'm long citi. >> we might have a bigger catalyst tomorrow on citi, because james frazier told me two weeks ago, going to announce, put numbers on the restructuring plan in this quarterly update, potential job losses, how much they're looking to cut out of costs in terms of restructuring. i can't ask you about citi, but i can ask you about the banks overall. >> i think what's going to happen in this earnings season is going to be a shift from macro conditions. so, what's priced in -- a lot is priced into the banks, and i think the focus is going to be more on micro. it's going to be on net interest income, it's going to be on credit quality, and it's going to be on the capital base. so, there is where i think we can get some positive or negative surprises. we're also looking for, on the back of bank earnings, the health of the consumer. you get so much data from those earnings reports in terms of whether it's delinquencidelinqu

deterioration of the quality in terms of their loan book, so, i it's a good sign for the broader backdrop going into the end of the year. >> or jamie dimon commentary, just about the environment. >> i think to your point, jamie dimon set the stage, the stocks have massively underperformed, they are some of the cheapest in the entire market, so, not a great press if you are more on a trader on the short side. but coming out of q-2 earnings into late july, the stocks had nice runs. expectations were really low. i think it sets up as a good, i don't know, take profit, resell. i think they're going back to the lows from the march regional banking crisis, and, you know, again, it doesn't seem to be an incremental buyer of these stocks, until there is more clarity about what the economic outlook looks like. >> remember when everyone said -- we just need higher rates for the banks to rally. >> moynihan used to say it a lot. >> everybody. that was the investor mantra. why are banks underperforming, rates are too low. >> the trade, though, is more on the preferred side as opposed to the equity side. when you are making a decision

about the banks, looking at the yields you can get, and given the capitalization of these banks, i think there's a really excellent place in portfolios for that exposure. >> great call. >> don't hear about preferred as an option very much on the show. when we come back, fasten your seat belts for this one. shares of fastenal bouncing higher today. we're going to bring the details and that trade next. stick around. much more "fast money" coming back in two minutes. ...before you even step inside? ♪ discover the magnolia home james hardie collection. available now in siding colors, styles and textures. curated by joanna gaines. don't waste your time trying to analyze market trends. that's what vector vest is for. our market timing indicators let you know when to buy and sell so you can ride the rallies and avoid downturns. vector vest's powerful tools give you the foresight you need to buy low and sell high. and while everyone else is looking at the hot stock of the day,

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welcome back. this next one putting the fast in "fast money." shares of industrial supply company fastenal, ticker fast, topping the tape today. the company saying sales rose 2% in the quarter. posted better than expected operating margins, as well. the stock leading the s&p. dan, you flagged this name. >> this is going back to that theme of sometimes the markets can be kind of stupd, right? this stock is breaking out. talking about all the stocks that you have never heard of that are trading poorly. this is one that i think is interesting, just the end markets they sell into. having some pretty upbeat things to say,and the results were pretty good. they didn't give a whole heck of

a lot of guidance. demand remains sluggish and weakness in manufacturing markets are intensifying. so, like, to me, that's kind of an interesting thing for a stock that's making 52-week highs that trading 30 times this year's earnings, only expected to grow 5% on 5% revenue growth, and only expected to grow mid to high single digits revenue in sales next year. so, like, it doesn't make any sense to me. i guess i'm more focused on what they had to say about the visibility of their clients, and the demand, than what the stock is doing. and i know that might sound coun counter counterintuitive, but earnings season is amazing, because you get to get all these data points, it's a bit of a mosaic -- >> it was the best performer today in the s&p. >> improving margins apart of it. >> controlling costs. >> the market is championing. but real quick, valuation has to get away at some point. 30 times earnings with mid single digits revenue and eps growth. something doesn't equate here. >> well, they just had a third-quarter beat, so, they've reported numbers, their digital business seems to be overcoming

some of the macro headwinds, and i think the customer dynamic and the relationships and the branch model is something that's really working for these guys. i think you stay there. i like it. >> yeah, i mean, it's like polar opposite here on the -- >> that's what we do on this show. >> it's good. >> split them off. >> does it mean anything for the rest of the industrials that are going to report in the coming weeks? >> i think the industrials have some of the same macro headwinds that these guys have to worry about. your dollar. >> my dollar. >> industrials have really underperformed here. let's be clear. and relative to the stuff that is performing and keeping the markets higher, you look at an equal weight s&p and it's down 3%, 4% on the year. and that's where a lot of the stuff lives. i'm not that encouraged. when we come back, lights, camera, taylor. in your wildest dreams, you won't believe the amount of money swift is pulling in from her eras tour movie launch. no tear drops on her guitar. that story next.

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welcome back to "fast money." some major media story lines

today, from a bullish call on spotify to one hollywood strike picketing on, to tay-tay coming to a theater near you. julia boorstin joining us now for much more on this. only one we really care about. >> well, there's a lot of news, and we're going to start off with spotify. shares gained 1% after morgan stanley reiterated its overweight rating on the stock with a $190 price target, writing, rising engagement levels and continues product innovation support further market share gains and pricing power. they did mention taylor swift. meanwhile, media stocks finished lower today after the screen actors guild and hollywood studios suspended negotiations. take a look. warner brothers discovery down 6%. now, just today, netflix's ceo says that sag-aftra demands are, quote, a bridge too far, while the amptp says sag is demanding a viewership bonus that would

cost $800 million per year. sag responding that the studios are overstating the cost of their proposal by 60%, and the guild's chief negotiator tells us that it is the amptp that walked away from negotiations, despite sag-aftra offering what they see as a compromise. this comes as this weekend the box office is expected to get a major boost from the debut of taylor swift's eras tour, the movie version, with $100 million in global presales at amc, breaking its record for singlsin single-day ticket sales revenue. swift will be back at the chiefs game tonight. so, we'll have to see if he draws the same 2 million additional viewers that she brought to the last chiefs game that she attended. >> well, julia, thank you very much. guy, i do have some news on that, apparently espn is reporting that travis's right ankle is well enough for him to play tonight. >> thank goodness gracious. >> which bodes well. >> we have a little time. when sarah hosts, we play taylor

swift in all the breaks, which is -- >> tay-tay. >> at my request. >> at her request. prior to this whole -- did you ever hear of travis kelce. be honest. no is the answer. >> not really. actually, i did. i knew about the two brothers in the super bowl. and so, the mother was very famous from last year. >> how are you feeling now? >> i'm not as mad as i was -- >> neither of them on the bengals and i still knew. >> we're catering to -- >> go brothers. that's a great story. >> maybe it's just about the football game, tim. i don't know what to tell you. spotify real quick. >> do have a problem with taylor swift. >> no, i love her. she's a huge fan of "fast money," she's watching now, ahead of the game. spotify, it's about time they turned profitable. key bank thinks they might do it early next year. that's a big change. so, this price target is not out of the realm of possibility. >> tim? >> you know this is one where multiple, i think, in a handful of these names has gotten a

whole lot better. not really where i'm going. >> yeah, i mean, that's a call, though, on profitability, right, as the companies have been working to do that. what kind of multiple is it at right now? >> well, they -- >> unprofitable company. >> exactly. >> as a multiple of sales a couple times, and i think that's the thing, they become profitable, they improve their margins, netflix has much higher margins, mid 30s, versus their mid 20s. if they can get north of 30, this is a stock that could easily get to that 190, but it's going to take -- >> you are the ultimate -- do you like this stock here? >> well, i like a lot of things that they've been doing, integrating podcasting and other things. and they had to cut costs there and that's been part of it. i think it's fine. look at the way the stock's traded, too. >> it's had a huge runup. >> it's really consolidated. >> we have to go. final trade congp mi unext. 6

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citi bank, too cheap. >> dan? >> yeah, qqq. hit a resistance level. >> guy? >> tay-tay? >> yeah. >> embarrassing. unh after they report tomorrow. >> all right, thank you for watching "fast money." thanks for having me. "mad money" with jim cramer starts right now. me, guys. "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's always a bull market somewhere. and i promise to help you find it. "mad money" starts now. >> hey, i'm cramer. welcome to "mad money." welcome to cramerica. other people want to make friends, i'm just trying to save you some money. my job is not just to entertain but to educate and teach you. call me at 1-800-743-cnbc or tweet me @jimcramer. 'tis the season to get clobbered. i'm talking about earnings season. and this time it already feels like it's going to be a rough