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tv   Fast Money  CNBC  January 12, 2016 5:00pm-6:01pm EST

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"fast money" starts right now. overlooking times square, i'm melissa lee. our traders are tim, david, karen and guy adami. tonight on "fast," could big oil be facing big dividend cuts. we'll tell you the name of the smart money companies cutting dividends later this year. plus the street has gotten negative on earnings. but that could be a good thing. a special report that could be a ray of sunshine for your portfolio. and later, it is the one thing that has traders petrified. and get this. it is not oil. we'll explain. but first we start off with what was the unthinkable. oil briefly breaking below $30 a
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barrel for the first time since december of 2003. the last time it was this low the dow was above 10,000 and the-year-old was 4.2% and gold was at $422 an ounce and the number one movie was "lord of the rings" but energy stocks in particular still managed to finish the day higher. so are stocks at this point pricing in a bottom for crude. guy, what do you say? >> i think the bottom is not here yet. i still think the commodity has more to go. look at the lvx. north of 65. and no bounce in the underlying commodities today. but what you did have today is the reversal in the big cap names. exxon-mobil had an interesting day yesterday and a pretty good day today. so we had -- i think christine on yesterday talked about potential for an earnings surprise. exxon was one of the names she mentioned. the way it traded today, leads me to believe you could see the
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bounce back to the $78, $80 level. >> karen? >> maybe we had a bottom, but i think in the short-term we had a market bottom. i don't like the futures up higher. i would rather see us rally, which we did this afternoon. we're so oversold now. but in the short-term, remember energy stocks and don't need to and correlate a bottom at the same time so maybe that is what is happening here. >> we did see a turn around when it comes to the financials. goldman sachs touched a new low. and a return of the momentum stocks. the fang stocks were higher today. >> i think the stocks got back to normalcy. and the correlation to high momentum and fang stocks to lower volatility and the vix was down 9%. and we talk about the ovx. well the vix is giving the market for more sanity. and all of that might go out of the window, because china tonight, at 9:00, import and export data in china, expect it to be minus eight and 11. people have been using this as a
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proxy to dictate the next day's trading action and something to think about. with regard to oil, technically oversold. clearly in a place where people are looking at all of the negative fundamentals building up but energy stocks, as we know, many good balances out there. we'll talk about that in a bit. but there is good stuff to buy. >> jeff dunn lock said this should be a short-term low for today. >> in the short-term. but we need to see the bankruptcies and the equities to jump back into equity. when that occurs, you will have a chance to jump in and buy the stocks. wait for the highly leveraged names to announce they go bankrupt or have a purge, if you will, then it is okay. >> why wouldn't you buy great balance sheets now? when in fact -- >> there is better places to put money. i look at it and say i could wait for another six months sitting in higher quality energy names and take the risk of the commodity going lower and dragging the names down -- >> so you are you saying -- what is high quality energy. >> not necessarily high quality
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energy, but higher quality names within the over all market. >> i want to get on with what we did today because we're going to talk oil later. what did you do today and what would you do in preparation for tomorrow or later this week? >> i bought some s&p puts -- i'm sorry, calls today. we covered some shorts on friday. we're always hedged. and bought some retail stuff today. i bought more kors and macy's. i think they are the beneficiary of the lower oil and we get so caught up in the global picture. and these are very u.s.-centric stories. >> and gee? >> you do have two encouraging days in a row. we didn't trade down to 1900. the 1864 level in the s&p was an august 24th low. again today, had every reason to do it once again and didn't do it. it rallied. and again i think the next move in the s&p broadly speaking suppose to 1970.
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we'll see what happens when we get there. the strength in the bond market suggests there might be more pain on the downside. >> you are talking about 2%. >> big open interest. and at 190 in the spdr. 1900 in the s&p. big open at $30 in crude. there is stability there. we broke through 30 and then popped back up tluf. and if we trade significantly through that it could be hard for crude. >> what did you do today? >> and high quality names are the things that stay -- and i mean high quality in consumer and low volatility names. i talked about kimberly clark and other names that continue to show global growth. what we need to see from earnings season, that is what we'll put in bigger for. guys talking about a 2% rally in the s&p, which i get. i think people are looking for outside of comfort out of the financials, you need to see a place where balance sheets are not in the same kind of pain people think they are.
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will you anything anybody is talking about is a 2% or 3% rally and throw the shorts out. and until proven other wise, that is where the market is going. >> it is good for the consumer but causing chaos for energy companies and the credit markets in particular. so which stock does a bond market see having severe trouble going forward. let's bring in larry mcdonald. a fixed income specialist as well. so larry, we wanted to pose the questions to you, dead or alive, when it comes to certain oil stocks. so let's start off with a large -- >> it is a great bon jovi song by the way. >> we're aware of that. bp. what do you see? >> i think for people sitting at home right now, you get one of these -- what i call the other side of the mountain scenarios, like technology in 1999, 2000, 2001. and energy is in that space. the other side of the mountain. a busted secular change. and so when you are looking at these names, you have to look at the debt profile as well as the equity. because many of the companies are vastly leveraged.
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bp has a very strong balance sheet from a debt perspective. you are talking about 70 to 80% equity in only 20% to 30% debt, in that range. that is a much stronger balance sheet than some of the others out there. >> and some of the others might include trans ocean. the stock reflects the difference in terms of the market cap versus the equity. or the debt, sorry. >> if you listen to twitter or follow chat rooms, people are buying these out there. i'm not going to single out transocean. when you get to a point where 70% of the entire pie or the enterprise value of the company is in debt, that is the kind of -- the area that you really should be aware of. so in the case of transocean, you are 70% to 80% debt and only 20% to 30% equity. so a much smaller -- so your equity has a smaller seat at the table. they have a lot of bonds sitting in front of them. as karen you could tell you. the pecking order of a capital structure. you have a lot of people in
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front of you. if things get bad, the equity gets in a much worse situation. >> you are out of luck, basically. freeport-mcmoran, is the picture even worse? >> it is the most levered company of all -- a lot of the big profile napemes. you are talking about a company a year ago had a 50%, 60% equity and 40% doubt and now talking about 80% debt and only 20% equity. and another fascinating thing about freeport and i think this is a key risk indicator to everybody when you are looking at some of the names is the near-term debt maturity, the one-year or two-year, they are yielding more than the four or the five. >> there might not be a four or five is the thinking in the marks. >> yeah. it has a lot to do with the dollar price. but people are worried about the short-term maturities because the bond is trading in the 90s. if something bad happens they will trade in the 40s. there is more risk in the short-term maturity. >> in your experience, because
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you've been around the block a few times when it comes to this stuff, what happens to a company with such high debt levels in a market like this, where commodities don't seem to -- they may not have found a bottom and they certainly don't look like they are going to sky rocket higher? >> it goes from cfos and treasurers and others driving a bus to investors. so people like carl icahn and others come in and force asset sales. they have a lot of debt but they might be sitting on billions of dollars of assets. so it creates more asset sales. >> but who is the buyer. >> who is the buyer of those assets. >> larry, we'll leave it there. thank you for coming by. interesting stuff. around the horn. dead or alive. do you agree with freeport-mcmoran. >> it is the most controversial. so i will say alive. i'm probably the only one out there saying that. >> you are. >> and the reason for that is because the equity has gone down. people are going after the stock. it is about the free cash flow. and if you look at forward curve
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and their guidance, it is what they say. copper at 208, oil at $44 which is high and gold at 1043 an ounce, this company is mildly free cash flow by 2017. they could get to that point. so will they sell off assets and not look the same? yes. they are not the same company in three years. but down, you look at the phenomenal assets. copper is not the oil market. it is for more imbalanced. and if you look at gold, people are thinking 1043 is a good place. i don't. freeport-mcmoran lives but doesn't stay the same. >> you have to be a buyer of the debt. >> i thought you were going to say a buyer of the equity. >> but i agree. and they could raise equity, and they could raise debt against the collateral of the forward book. and this is something that rig could do as well. but i think the debt side is a better place to play it than the equities side. >> personally i wouldn't play freeport right now.
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i don't believe in the story. >> do you think they are dead? >> i believe they are dead. >> could be we clear, too. >> this is a horrible investment. i believe that. >> i don't want you to -- to cut ow of. this is are they dead or alive. not what would you do. >> i think they are dead. bp went on a campaign last year talking about the fact they could fund their dividend at $60 oil. they confused people on that. dividend will get cut in bp. there is no doubt about it. is the stock dead? they are not dead. they will ride this out. i won't touch it, however. >> karen, how do you break these down. >> freeport, i think dead. and carl filed that d., maybe about a billion dollars worth of stock. we haven't seen him buy any more. which tells me he is not selling it, right. and i think, very likely, if he still wants to be in the name, he is out there in the debt. and he'll look to restructure it like he did in federal mogul.
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he restructured it in a bankruptcy. so to me, i think dead. bp, alive. they could issue equity and they have a lot to do. rig, i think life support, maybe they could restructure debt somehow. the companies need time. if they have some time, good things could happen. >> i think bp is alive. i don't think it is an issue. i think freeport-mcmoran, butt for carl icahn could be dead. i think it comes back and restructured in some form. i don't know what happens to the absolute equity. i still think it goes lower. >> but they don't have a debt that will kill them in the next six to nine months. people are looking at the stock price going down because speculators are saying smig and they won't be able to pay free cash flow. >> and you need somebody to buy yourself. and they top tick dodge and others and they are in trouble. there is no bounce in the things they need to bounce. trouble. i think life support is right.
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gun to my head, i say dead. >> coming up, do you know any bill oil stocks? you could be facing a big problem. some savvy trader could see a dividend cut on one widely held name. and starbucks making a push into china but what the ceo just said moments ago on "closing bell" that has traders excited. and later, could earnings revisions be so bad they are good news for the market. why a relief rally could be in store and how you could get in. much more "fast money" after this.
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. we have a news alert on yum brands moving higher in the after-hours session. seema mody has details. >> yum shares up about 3% after hours. the company's china same store sales increasing slightly by 1% in december helped by the kfc operations, sales jumping 5% and 11% drop at pizza hut. this is the final monthly sales in china before the business is spinoff which is expected to be completed by the end of 2016. melissa. >> thank you, seema mody. in terms of yum, the spinoff, is it worth the buy ahead of the spinoff at this point? >> for the stock, yeah, it has been beaten up enough. first of all, risk, reward, down
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around $63 is a level i would own back to 2013. that was the break-out levels. i think there is good support here. and the valuation based on the china sales we know about, the most recent sales and trends, this stock is cheap to the recent history. >> let's broaden out this discussion here. speaking about china. talk about starbucks. the ceo howard schultz smoke moments being on "closing bell" about his big expansion plans in china. >> on the ground here, what you see is a very dynamic city, a consumer-based economy in an upbeat market. >> so we played that because this plus the yum news, does this mean that perhaps china is better than we all think. guy? >> i'm not questioning whether the consumers are alive or dead in china. that has nothing to do with it. and my concern with china, and maybe tim and i will disagree with this, i think they have lost control over some of their markets, currency. which leads to dangerous things. starbucks has been very
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aspirational as have nike and other brands. so i wouldn't make the lea of faith saying consumers are in great health because they are buying coffee. same thing here in the united states. but the inability to control the markets and the health of the consumer to me are mutually exclusive. you stay long starbucks and at tim's point, you stay long yum. >> is it inexperience? they have the capital and the intent to support the markets. but they are lacking experience in that front. and i look at it and say they are going to make mistakes in this process. so, look, you have to give them a little bit of a pass for that. and i do give them a pass for that to some extent. but i look at the forwards up in nike, up and the consumer is on fire over there. we are seeing it across the board. you see the reaction to starbucks announcing 3200 stores in china, the stock reacts because people and investors understand this china thing is really overblown. >> people need to realize also
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that the chinese stock market is not the chinese economy. and the shift to a consumption economy, about a decade ago and maybe it is 44% now. it has a long way to go. starbucks, the same-store sales 6% lower than the global comps. i think the bar is lower in china. listen to this -- how different is what howard schultz is what you are saying today an most of the ceos that walk the ground over there and talk about their business. they say it is nowhere near as bad as everybody is making it out to be and those are guys motivated on consumption. >> and if you look at retail or discretionary, does china concern you? would you say we don't know what is going on, i'm not sure so maybe it is time to step aside? >> for the super-luxury high-end. like prada had trouble in china. but for a name that is u.s.-centric, i think times are good here. i think -- and we get stuck in
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this idea that everything is bad all over the world. they are good here for the consumer. so i'm not worried. so a name like footlocker, they do have european exposure but they are primarily u.s. based. i look them. >> twitter lost half of the value but they just did something that could change their fortune. we'll tell you what that is right after this. i'm melissa lee and you're watching "fast money" on cnbc, first in business worldwide. here is what else is coming up on "fast." you are talking oil, who knows. but some traders think big dividend cuts are in store for big oil. we'll name names. plus -- >> the state of the union is not good. >> and neither is the market. and we'll tell you the one thing that has investors most scared. and it is not oil. we'll explain when "fast money" returns.
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welcome back to "fast money." i'm aim on javerss in washington, where officials are saying ten u.s. navy sailors are being held by the iranian government at this hour. according to officials that includes nine men and one woman who were on two small riverine
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boats. u.s. officials are saying they experienced mechanical difficulties and drifted into iranian waters. the officials say that secretary of state john kerry has been on the phone with officials in tehran in an effort to resolve this situation. it is a very sensitive situation. at any point made more sensitive today given that it comes a few hours before president obama's final state of the union address this evening. so what we know as of right now, ten u.s. navy sailors are being held. those are nine men and one woman and u.s. officials are in contact now with officials in tehran, trying to come up with some resolution to this situation as quickly as they could, melissa. >> thank you, and i think the timing with the state of the union is important. but what does this do for the price of oil? we've seen conflicts in the middle east. it does nothing to oil. is there such thing as a risk premium to a barrel of oil at this point. >> i've tried to -- geopolitical risk, we associate with the
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price of the commodity going higher. i would submit it is alive and well and driving the price down. the saudis have every reason to want the price to go down and that is continuing to be the case. it bee hohoves them to drop the price down. >> you are right except that was saudi-iran. and this is iran-u.s. and if this is a big raul between us and iran, and this shouldn't be the reason there is one, between you and me, but that is a reason for a spike. it is not saudi-iran. >> because they could reverse the sanctions, the lifting of the sanctions? >> yes. >> twitter rolling out live broadcast directly into tweets through periscope, but is it enough to save the stock. julia boorstin is in l.a. with the story. >> in march of last year, twitter bought periscope and it is now finally integrated the
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live video feeds into the news feed. starting today twitter ios users will find periscope in their feet. they could click to expand the video and see hearts and comments on the videos. but users could not live broadcast within twitter, nor will they be able to comment on a feed. they would need to download that periscope app separately. with twitter stock down by about half over the past 12 months, this helps twitter tap into the growing popularity of mobile video. it also should help boost periscope viewers. analysts put a buy rating on this stock writing in a note this is a step in the right direction that could potentially drive user engagement by growth. mezuo saying it sees increasing signs of brands putting in creative effort and money into producing prime content on the periscope platform. but this move comes a month
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after facebook rolled out the live feature back in august to all of the verified users and bran brands. and facebook users could broadcast and interact within the facebook app and facebook automatically archives the videos. twitter wants to be the destination for live events so we could expect it to continue to put periscope at the forefront. we'll have to see if that helps add more users. back over to you. >> julia, thank you. will this help, seaberg, in your view, with twitter stock? >> the question is will it help? it won't help them under current management? could it help? it is a great product. if they could figure out how to monetize it and grow the user base, it could be a home run. i look at it from an earnings call, they had an earnings call on it. it is a great tool. but the problem is they can't figure out how to manage. >> are you saying that the management is incompetent. >> they can't manage the core business, how could they implement this business. this is a great product. they are not managing the company correctly.
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and that is why the stock will go down. i've said it before, it is a $15 stock. >> it is a great call. they are monetizing. >> nobody is going to pay for that. >> i'm in the name. i'm neutral the stock. i'm not interested in putting in more money in it. they have to grow the user base. this won't do. it it is ultimately a base -- the nonlogged in user. broader viewership into twitter is what needs to raise the growth which they haven't had. >> there is no engagement. you have one follower, you are not that engaged. what do you have, 200,000 or something? >> you have no idea. >> forget about my vest. >> and it is about the current subscribers on the platform more engaged and getting them a following base that they could be relevant to. that brings engagement up. they can't figure that out. >> gee? >> david has been spot-on here, 100%. so i think google doesn't talk about maus at all. why do i mention google?
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because twitter shouldn't talk about it. it is too valuable of property to talk about monthly average users. they should look at it through a different prism. i think a couple of analysts have made that point. >> what is it, though? >> to me, this is a -- this is learning about what is going on in the world. it is a news service. for people in our industry, that is how we get news. for people in the other parts of the economy, it is a way for them to get ne. to me, it is too valuable of a property to be discounted the way the stock is being discounted now. >> what does this mean for google, if anything? >> the cheaper it gets, the better for google, if they are ever inclined to do anything. >> should google buy them? it sounds like you think they shed. >> i did. but with dorsey in the ceo, i think that window has closed. up next, could lower estimates for earnings be a good thing for the market. one analyst says yes and what has him so excited. and the state of the union might be hours away but what
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about the state of the markets. as the president polishes up his speech, two traders are going head to head on the bull versus bear and whether the economy is in a better stage than you think it is. it is a seaberg versus tim battle. they have been warming up. this one is for the history books. stay tuned.
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so are you going to leanne miller's birthday part? >> 100%. how old is she today? >> 20-something. >> a lot younger than us. >> i hear it will be the hottest party in lower manhattan today.
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welcome back to "fast money." today was the best day for stocks so far this year. the dow ending up triple digits. and the nads was the day's best performer, up threein disys breaking the eight-session losing streak. but the big story was oil, dipping below $30 a barrel since 2003. crude is down 17% for the start of 2016. coming up in the second half of "fast money." worried about oil. one of the traders said there is a much bigger concern hanging over stocks. we'll tell you what that is and what it could mean for your money. plus are dividend cuts coming to
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big oil stocks? we'll tell you what the traders are betting on later in hour. meantime, we're watching csx, falling in the after hour sessions on earnings. mary has the details. >> the fourth quarter profits declining, still beating estimates by 2 cents a share. the top line suffered from lower volumes. all segments, merchandise, intermodal and coal posting lower than expected revenue. the decline in coal off 32%. domestically, demand was down as utilities are opting to use natural gas to power operations instead of coal. and the firm said demand for metal and thermal coal was weak because of global over supply and the strong dollar. the picture, it is not expected to get better in 2016. the company forecasting profits below the $2 a share earned in 2015 because of continued low commodities prices, a strong u.s. dollar and upheaval in the market. analysts had estimated a 2%
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increase. back to you. >> thank you. and for transports and oil. it is interesting that oil is not a help for transports. they are acting terribly, whether it be the rail or the airline stocks. even with the decline. >> you throw what is throw wt is going on in the coal world on this and then a stock trading around a five or six-year low. i think it made another new low today. probable in the after market. people have tried to buy it for the last seven or eight months. you are looking at it wrong. the core business needed to change and this tells you they are not any time soon. and speaking of earnings, analyst sentiment is terrible. but they say it might be good for the market. paul hicky joins us at the nasdaq. good to see you. it is all about expectations and so what are you noticing in terms of how bearish analysts are getting? >> well, this has been the scene for the last six quarters. and for several quarters beyond that. but the last six quarters going into earnings season, we've sen
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negative analyst sentiment and more negative than positive revisions and there hasn't been a single day since the third quarter of 2014 where we've had -- trailing a 14 week period more positive than negative revisions. but analysts are negative. but we are seeing the expectations bar, like you said, melissa, is set low. and when you have this situation during earnings season, you get a tradeable rally there, a short-term bounce in the market. >> and you are seeing that happen in three sectors specifically? >> yes. so energy is one of the big culprits. materials is a big culprit and industries. and more than two-thirds of companies have seen revenues cut in the last four weeks on a net basis. and if you go back to when more than 60% of the companies have negative revisions into earnings season, you see the sector has averaged a 3.5% gain during earnings season with positive returns every time. there is five other quarters where it has been that way.
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and gains each time. materials, similar situation. six quarters where it is at about minus 56%. minus 40% or more, there is six quarters. and the average gain during earnings season has been about 6.5%. similar situation for the industrial sector. so when the bar is set low, you get companies exceeding or exceeding that lower guidance and the bar is set low and the stocks react positively. >> is this different from the previous quarter or two quarters ago or three quarters ago or could you have come on set and said, the bar is set so low for energy stocks they are going to beat the earnings expectations and here we are. have you bought those stocks thinking you would be if a hole right now? >> last quarter, about three months ago, we came on and did a very similar segment and mentioned the energy sector and it was up since last quarter. so it is a six-week period between alcoa and walmart approximately. >> so only during that period. >> yeah. >> would this sway you? >> i think a lot of that was
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hedge fund positioning. you have short coming on the earnings results and position as head of the earnings that were primarily really short with the hedge funds. so the cover trade really came on in a fierce way to really put you up. >> don't get me wrong. >> and if that occurs -- >> these results will not be good. especially in the energy sector. but look at what happened in the sector so far this year. we are not -- investors aren't anticipating good news here. >> paul, great to see you. thank you. >> good to be here. >> any of those sector sectors a -- sector as peel to you because the opinion is so bad. >> i think we're in a different environment where people are looking to even fade the bounces. i would watch health care and the things -- utilities. the places where people think are defensive. earnings revision ratios in those sectors are going down and that is something you have to be careful about. >> which sectors are watching most closely and what are you expecting? >> well like tim said, i'm watching health care. anthem put up decent numbers.
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a lot of stuff out of the jp morgan conference. i like industrials. i like the counter intuitiveness and i think the sentiment is awful. >> which are you in? >> uri, which is a terrible place to be. but i'm optimistic, it is overdone. >> you are holding it still. >> paul hicky and ken show should have lunch together. it is like the same person. maybe paul hicky is ken show. >> or vice versa. >> oh. >> just thinking. >> ibb, held 285. it is a level tim pointed out months ago. very interesting. >> and bulls are running scar scared. what has our traders worried after the break. and a battle happening in the nfl. which team will make it to l.a. first. a special "fast money" report coming up. much more "fast money" still ahead.
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quick question, what are voya retirement squirrels doing in my house? we're putting away acorns. you know, to show the importance of saving for the future. so you're sort of like a spokes person? no, i'm more like a metaphor. okay, a spokes-metaphor. no, i'm... you're a spokes-metaphor. yeah. ok. see how voya can help you get organized at welcome back to "fast money." you are taking a look at the live shot at the white house where the president is getting ready to make his way over to the capital building to deliver the final state of the union to congress. that got us thinking, about what about the state of the market. so we'll have a debate here. tim versus seaberg. >> who is the judge on this,
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that is what i want to know? >> the jury of the people. from twitter and these two characters. >> and the market will be the judge. >> so seaberg, with the bull case, we start with you. >> so look, to be clear, i've said it all along i think the s&p is flattish at the end of 2016. so from where we are now, i'm very bullish. i think there is a tremendous amount of opportunity here. and i'll tell you the china news, they hit the tape, i've been reading stuff across the board saying china is like 2008. that couldn't be further from the truth. and i think people at home sit there and read headlines and get completely confused. they get confused over the fact that the china stock market is in turmoil. the stock market is a completely different market than the u.s. stock market. so the confusion around that is completely overblown in my opinion. we are seeing job growth and lower oil prices. lower oil prices in general are going to keep this economy and bring us out of a period where -- i'll tell you, people are overconcerned, over blown in
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my opinion for the wrong reasons. >> i'm definitely not one to say the sky is falling and i don't think it is either. but the manifestation for markets are earnings. and the macro we are talking about, we are at a place, we talked about it in the last block, earnings are going down. and we probably had peak earnings about a year ago. so not only are we seeing earnings revision ratio but gross margin are at their peak. they have no place but to go down. they are being boosted by buybacks and m&a activity attributed to the bottom line. you have to see pmi in the u.s. and china stabilize. because right now we are in an earnings recession we are in an industrial recession. and as much as the world isn't collapsing, i need that. but you talked about the fed policy, i agree. it is clumsy. but china policy and fed policy is injecting so much volatility the correlation in the markets
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for the next three months are held hostage by the policy and risk of policy failure which i don't think we have. add that up though, expensive markets, policy failure. >> over sold market. >> over towards here. that would be it. >> could you run over. >> very debonair of us. >> kick it off. >> i think david is right in the short-term. over the next few days. i think the market will rally. but my allegiance is with tim on this one. because clumsy central bank policy at this stage in the game could be very dangerous central bank policy. one misstep in the world we live in today could be, for lack of a better word, cataclysmic for markets around the world. >> karen? >> i agree with david. it is overblown. it is not about earnings, but it is about expectations which i think are low. >> so they are split. >> it is a split. >> you are not going to see bankruptcies occur in china.
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>> this is tough for me. i'm not saying sell everything. on friday, i was saying don't sell everything. but markets have headwinds that won't lift for three months. >> but they are a catastrophe. they are headwinds and pricing in a worst case scenario. that is what happens when people compare 2008 to the current times. they overshoot. they've overshot where they should be trading. 15.5 times next year's earnings. >> i would like to make one point. and that is that both of you could be right. >> oh, wow! >> no, i do not believe. but the way guy framed it, in the short-term versus the long-term. >> markets are oversold. but the conversation about where the markets are going, not where they are going tomorrow. and probably not where they are going in two years. to me it is an objective of what are the headwinds for the market. we have many. >> if china had headwinds -- no
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question. i've been hearing that since i started in the business in 1993. >> that china would come out and take our head off. it hasn't happened. i've been saying for months that -- >> but think about -- tonight we get trade data that is painful. what will the market do tomorrow. i'm not saying it is right. >> that is a good buzzer sound. >> we'll see. >> love you, bud. >> you could kiss during the break. still ahead, oil could face big cuts. which names traders are betting will slash their dividends. that is next. and is the nfl hollywood bound. to the face-off between three major teams staking their claim in the city of angels. you're watching cnbc, first in business worldwide.
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here at td ameritrade, they work hard.
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wow, that was random. random? no. it's all about understanding patterns. like the mail guy at 3:12pm every day or jerry getting dumped every third tuesday. jerry: every third tuesday. we have pattern recognition technology on any chart plus over 300 customizable studies to help you anticipate potential price movement. there's no way to predict that. td ameritrade. welcome back to "fast money." in houston, nfl owner as rivaling for a meeting to decide the future of football in los angeles as fans of the rams, raiders and chargers hold their breath, jane wells is on the ground with the very latest. jane? >> melissa, lot of moving parts right now. we're told reportedly the owners as we speak are voting on either the rams and another team in
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englewood, so not themselves or the chargers and raiders. talk about powerball. billionaires deciding the fate of four city. >> will l.a. finally get a team? >> we'll find out. >> that is steve tisch of the giants here. paul allen of the seahawks. dan rooney of the steelers. they should be focusing on the playoffs, all here to vote on l.a. the relocation committee today recommended the bob iger-led pitch to bring the chargers and raiders to a stadium. and he said the time to act is now since the teams have made it clear they want out of whenever they are from and want to come to l.a. >> once that position is taken, and essentially affirmed by the league, then going back gets harder. and at some point, there is a no-go date as the teams have to figure out where they are playing next season. >> all right. you are looking at rams and
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owner hunkering with roger goodell. he is pitching a fancier and bigger stadium in englewood. and said st. louis doesn't have the economy to support his team. then the third option from cowboys head jerry jones wanting to pair the chargers with the rams and shut out the raiders. what do fans of oakland, st. louis and san diego have to say? >> raid-ers. whoa! >> outside of the hotel, there were eight raiders fans, two guys supporting the rams and one guy made the trip from san diego. the problem is, for them, they are probably all going home, or two of them going home empty-handed. any team that moves to l.a. will double in value because the clippers and the dodgers sold for over $2 billion. but you need 20 votes, 24 out of 32. it is kind of like voting for the pope, guys. >> jane wells, thank you, in los angeles.
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i go to l.a., karen, because it is your home town. and you know a thing or two about football? >> i love football. i don't know. i just -- i would be very curious to be a fly on the wall during that meeting. i can't imagine all of the back room dealing that goes on there. i don't know. >> i'm glad guy adami wasn't there. >> i think he was the guy standing outside. >> l.a. is a great sports town when the games are at night. it is a fugazi football town. because they are hanging out there, surfing. st. louis is a great sports town that should not lose their franchise. i'm with the people in st. louis. >> what does that -- >> let me tell you something. on sunday afternoon, when they play in the national football league, you might -- they ain't going to the games. >> the fans aren't going to the games. >> that is not fair. the question is the value of the franchises is determined by the tv rights and this whole thing is changing. and if i look at the media networks trading right now,
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including msg, based on the underlying value of franchise, i think sports franchise may have top-tipped. and you are in a -- because of the changing media landscape. >> ticket prices will get a premium in l.a. >> the collapse in crude prices have put pressure on dividends of many bill oil stocks. options traders are expecting decreases in the next year. mike is in austin with the action. hey, mc. >> so we are looking sat the bigger integrated oil names here in the u.s. and if you take a look at exxon, the largest, that is the one in the most stable condition. but still the options market out to 2017, showing a potential cut in the dividend of around 30%. chevron, which is probably the number two integrated name, showing a cut potentially of as much as 45% over the same time frame. but conoco-phillips is the weakest of the three. and the options market there are forecasting a potential dividend cut by mid 2017 with as much as
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50%. >> thanks for that. check out "options action" at 5:30 on friday. on oil dividends, i imagine they would fight tooth and nail to keep it at one penny to still remain -- >> but the still ones could cut the dividend by half, as he was saying. and i think they should. they are not getting paid for it now. the yield is telling you they don't expect it to continue that waxt it is a rainy day. they have to save the money. there is going to be opportunities for them to use that cash. i think they should do it. >> they don't warn you when they cut. they just cut. so everybody thinks there is going to be an obvious or a transition period. bp is cutting. and david said this. but because they've already cut. so people are protecting an untarnished dividend history. they have a tarnished dividend history and it is easy to cut again. up next, the traders tell you what they are watching tomorrow after this break. stay tuned. i think it landed last tuesday.
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one second it's there. then, woosh, it's gone. i swear i saw it swallow seven people. seven. i just wish one of those people could have been mrs. johnson. [dog bark] trust me, we're dealing with a higher intelligence here. ♪ the all-new audi q7 is here. ♪
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and finally, "fast" but not least, but no lucky winners over the weekend, the largest ever powerball swelled. to a whopping $1.5 billion.
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which got us thinking what companies you could buy if you hit the jackpot. so we did the math based on current market caps. you could buy hovnanian, etsy, finish line, sun he had isson and pep boys. >> it could be cool just for that. >> get some tickets. i see you 18.5 and give you 20. >> time for the final trade. around the horn. tim. >> it is time to go with defensive earnings,ality rhea is the name. i stay in the name. >> seaberg? >> listen, fitbit. i've been negative on the stock but for a trade here, for a trade below $20, it is absolutely worth a buy into earnings on february 2nd. i think it will be a good number. could trade at $25. >> chairwoman. >> ralph lauren seems so overside. doesn't trade at this price very often. r.l. >> gee? >> congratulations to crimson tide. roll tide. look at you. >> i watched the game.
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>> kicked harvard's -- this year. >> a family show. >> ibb gets you done. >> i'm melissa lee. see you back here tomorrow at 5:00 for more . . . z. >> 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. i promise to help you find it. "mad money" starts now. hey, i'm cramer. welcome to "mad money." welcome to cramerica. i am trying to make you some money. my job is not just to entertain but educate and put it in context. all me or tweet me @jimcramer. one story on everyone's lips. how in the heck is it possible that our stock market isn't soaring every day on the news at


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