Expect from cocacola when it reports tomorrow but we begin tonights show with bonds, treasure bonds because Something Big is shaking and stirring the market. If you havent been paying attention. Bonds staged reversal. Sending yields back to the highest levels in month. Is this the official ends of the. I love the booed bootleg bond music. We cant use the real one. This is a real song. I dont know but its not bond music. I hear the lyrics there is a man leading a life of danger thats tim seermt. I did ride my citi bank to the studio. Johnny rivers why you looking at my quizzically. Im asking you is this the end of the bond or bull market. I dont think it is, mel. I can be proven wrong as i tip cheh am on any given night bond yields go higher because economies improve. Maybe there is somewhat improvement. Were in the beginning of a turn i think you see it in manufacturing. I think youll see it here in terms of earnings when a lot of the industrials report although the bond market had a big move from a 10year from 147 to 178. Where we are now. I think as long as the tlt stays above 135. 19. 5 now i think the bond move is intact. Some of the scary stuff has awaited. China trade looks less bad brexit less bad. Now chatter the fed will pause the sort of i dont want to say cycle of adjustments but it could be a midcycle pause. I would take it further bond yeemds recently becoming more immune to bad news as well. October 1st we print a 47 on pmi. Bond yields trade back down to 150. Yesterday miss retail sales today Housing Starts bond yields back above 175 there is a message there of some immunity to bad news breaking news here on the United Auto Workers strike jane wells has the latest. Jane reporter guys just a minute ive been trying to im going off camera a second. Hold on peek around the corner to see if they are academic up they are not but at any moment the uaw leadership and president s will hold a News Conference someone inside the meeting came pout and told us that the Union Leadership has convinced the 200 local chapter president s to ratify the vote and ratify the contract and send to rank and file for vote. But here is what we also herron learn. The nbc affiliate in detroit, the 200 chapter president s decided that workers will not come back to work until the ratification vote is completed and that the deadline according to the local affiliate is a woke from tomorrow. That means very bold move by the leadership that they would be out of work yet another week its been over four weeks theyve been out of work one of the hold ups. They were in there for over six hours today. We thought whats going on one of the hold ups may be there is a second strike at gm with the maintainens workers. The uaw didnt want to cross that line. They are reporting a tents active agreement with the janitors that hurdle has been crossed i think one of the biggest issues still facing the vote, despite all the 11,000 ratification bonus and very, very great low health care costs, the lordstown plant in ohio will be closed. And for some members here today that will be a deal breaker when it goes to the rank and file we have to see. Jane wells, thank you with the latest on the uaw strike the problem here is that the cost, the estimated cost which is now at about 2 billion to gm for the strike will continue ticking higher as long as the workers remain off the job. Although, the reason they remain off the job is because there is a deal not cut that gm wants to hold certainly their line of negotiation. I think first of all it was deal day, right we had gm, brexit, turkey, a lot of big news. To the extent this is a this doesnt change i dont think any of the deals as we talk about in the next segment for gm is not about the strike the story is really people trying to view where the the profitable model north america suv markets, where we are in the auto global cycle. Strike workers getting more pay. The union is robust and full and able to hold out for a better deal if you trade gm stock right now this is not an sbaker of something to trade on. Yeah, i agree we talked about it last night. Remember i said what year is it you looked at me like whats your problem as its your wouldnt to do. I often do that. Gm was 36. 5 and thats where it is now. If gm cant rally over the last five years when the stock market has gone nothing but higher in the environment where the car industry has been the best its been in history. Then when does it rally. My answer is its not. What does the chart. Chart has been dead money a long time. But whats interesting if you get something to go right here you have seen competitors break out. Volkswagen breaking out. Toyota breaking out. Maybe there is pent up demand for auto stocks but it has to be resolved lets get back to the bond discussion here. Talking about whether or not the great bond bull market was in fact over. Dan i feel like youre going to sayits not. Its not. I mean i dont say definitively because i dont know chris. If you take a chart of the 50er treasury dwreeld the last 12, 30 years. Its the well defineddown friend and the last 20 years. The high in late 1999 close to what almost 7. 5 or maybe higher what came after that was a 50 drop in the s p 500. And then we had this move back up in rates to 2007 in november. And it topped out again somewhere above 5 en and then what have we been doing, 2012 we had another s p cut in half right after that and then we had a 145 print in the summer of 2015 on the 10year backup 2016 a retest of that and then we have almost had that again here triple bottom. I dont think there is anything i dont think there are triple bottoms and the more times you test that low after such a sustained period of weakness, id say theyre going lower. And then take it one step further, stocks are back in again at alltime highs. Where do you think thats going . If yields go lower here. Dan, im glad you brought up the dates. If you look at the 10year yield on rate of change basis, the year over year change in 10year down 50 yields cut in half over the last year two other times happening in history. January, february of 09 and summer of 12. And they also put in good tradeable advances in stocks and injury when you look at the character of the equity market its cyclical. Trucks acting better semis accurating better. Rest of world better if a tradeable low is in put in wonder yields also know german yield bond bottomed six weeks japanese yields turned i think there is an option to be a trader here with the bond market. I dont think so. Low yields have not been good for equities in the last three to six months. Low yields have been fear. People concerned about groebl growth reminded me of q 192016 got you to the low that you talked about, dan i agree if you look at the 10year chart back 30 years, 12, 16 and 19 its the place where we stopped and bounced the question is really in a world where Central Banks during the time that ehave thrown money on the problem i think we have a Global Deflation problem, no matter what you say we are fighting deplacing aba credit bubble the biggest problem of the aftermath the credit bubble its a cancer that needs to be carved out while it was carved out of the private sector and Housing Market it was transferred to the public secretary are that concerns me snl Central Banks reel in the enormous the slatting of liquidity we still have this is financial oppress pressing for most people terrible for savers its not working for asset prices it was transferred to other places wework is exhibit amount p we work wouldnt have been a 47 billiondollar valuation if rates werent as low as they were for as long and if there werent the unfunded pensions looking for returns they cant get anymore because of the situation that weve been in with the rapts where they are so i mean it is cyclical and it doesnt end well. And my only point is it probably ends with rates lower than here. We soo that goebelly because Central Banks had no choice almost everywhere else other than here to take their you know, their yields negative. The three of you guys think that we havent hit bottom necessarily or that right i mean, tim is that i would also always like the chance to put a caveat on this or put context on it. Okay sfla i think over what we have seen the last three to six months, by the way, by any measure a historic move in bond yields as chris pointed out. But i would say that in the so because of that i actually think bond yields were overbought yields too low too fast. If you look at the context of the three to five years next right now its tough to stop where we are let me make two points. When you look at positioning right here be mindful of how crowded the long side of the bond market is tp flows into the tlt at record high right now a lot has to go right from here for the bond bull story to keep working. Because everyone is already there. I think the second thing, the bond yields today i think are reflecting or the data today reflects what bond yields have been telling you two years we not economy slowed i think the question is after two years of lower bond yields is that getting stim la active for the economy here you already have a german pmi at 41 whats the worst it goes from here maybe 38. Is that already discounted in stuff like autos and housing and semis, these leading groups . Germany is as big of a reason why we are at 1. 44 on lows the other issue for the bond bears, meaning yields go high are. Thats what happens yields go up when bonds sell off is the treasury has to refund enormous amount of u. S. Treasury. There are taqle reasons eeshlg on the long end of the curve when you look at u. S. Government needs to finance in terms of deficit and the Balance Sheet and the technicals say that bond yields are going higher. And the question is ultimately, what does that mean for that triple b tranche of credit out there that right now is trading at 1. 75 over and that is something the minute is widens its having huge ramifications sending bond yields lower. Basically you are worried about the fallen angels effect. Absolutely. Right absolutely. Slowing down. What are the implications i know you dont think about the or you dont think the bond bull market is over. No. What is the implication for the safety trades in the markets that have gotten so much love. Safety trades like utilities for example, listen, i think they go high are we had a guest on. Even from the environment. Dan suzuki one of the long tradesy utilitypy i understand valuation is a stretch adding a caveat to tims i think there is more next week when caterpillar reports wednesday and names like robber and triple m report thursday the deepic sole names see what they say i dont think its gad and if its not yields go lower. The defensive groups are remarkably crowded here. If they continue to work things really have nog that direction when you look at cyclical green schutts starting to show up with deere breaking out we talked about that this week with you see with semis outperforming software thats a change in the character of the market see it with the Chinese Consumer names acting better. If there are cyclical green chutes i would be careful in the long side of the bond market. Its crowd you had as well. Watch copper. Process you look at a chart of copper hg 1 its trailed sorry been totally correlated possibly even led. 10year but i want to see how we trade across europe. Base because the bund curve is important. The brexit deal may put dollar pull bulls on the back foot if you think about the dixie basket its 60 youre owe. And you have a structure the europe, the euro should be rallying here. Way we havent touched op the yield curving is steepening. Getting so much attention when if inverted i dont recall attention when its uninverted threemonth seer is theed widest 2s appear 10s with comfortably process positive that is that another sign of the cyclical green shoot going. The safety trades, state your name staples be proctor and gamble trading a this is the steepest break outout this stock had and been a ramp. Whats it done the last couple years as yields come back . Its rolling over and its blow that up trend in place i dont think you want to be long proctor and gamble above 120 trade oil at 116 right now trading at 25 times expect the midto high Single DigitsEarnings Growth for that dividend just because you think its defensive that goes for utilities and might go for reits netflix losing team after the earning rally are Stranger Things in store for the streaming giant we weigh in. And the bombshell report all wall street. The market moving remarks of President Trump. Vanity fair correspondent behind the big story. Joins us ve flirom new york city times square, much in more fast money right after this. And you should be mad at simple things that are unnecessarily complicated. But youre not mad, because youre trading with e trade, which isnt complicated. Their app makes trading quick and simple so you can strike when the time is right. Dont get mad, get e trade and start trading today. High protein. Low sugar. Tastes great high protein. Low sugar. So good high protein. Low sugar. Mmmm, birthday cake pure protein. The best combination for every fitness routine. Through the at t network, edgetoedge intelligence gives you the power to see every corner of your growing business. From finding out whats selling best. To managing your fleet. To collaborating remotely with your teams. Giving you a nice big edge over your competition. Thats the power of edgetoedge intelligence. Welcome back to fast money. Netflix surging after the close yesterday on an earnings bet but the stock lost a lot of gains today after analysts had more time to digest the skrurk miss saying it would weigh on the company. Hit getting hit by analysts at mcacquire. They say competition is skomg and the company doesnt look cheap compared do streaming peers. Does the sputtering after the surge mean the Netflix Binge is over we were skeptical of the quarter and the stock reaction. I think we have done a decent job on netflix might trade up to 317. 15 retracement alltime high, the after market thats exactly where it went last night today it traded i think almost five times normal volume gave up most of the gains. Again if you go back and look at giepdens it wasnt particularly strong i know their International Subs beat significantly but then you heard for the next quarter. Its not you a inspiring i will like netflix again. But i think it told you everything you need to know in terms of price action. Up more than 8 yesterday after the bell. Remember we did the the chart they did that. The sentiment for. You it will me what it means. One going this way. The other one going the other way. What im saying obviously we had kinz be comcast, at t all the ones vertically integrated going berserk over the better of the year and since july, netflix has been going the other way. Sentiment got weak and the guidance in july was bad when you digest this last night with the stock trading up 8 you say to yourself wow the north american subs werent great. Two quarters in a row. Right. I dont think international it was a great it was a relief. Sentiment was really bad and short squeeze. This is a horrible close for the stock. Horrible trading today. It got back to the 285 level before the earnings yesterday. Intraday today, reed hayesings letter assurance to the world abshareholders sharmds, whoever it was wasnt reassuring. His point was look there is a lot of competition but addressable markets is growing Everybody Knows people are streaming. Everybody knows i just i we rewarded netflix in 150u7 2017 and 18 for raising provides and pass them through to consumers do you think theyll be able to do that . I dont think so and i think the stocks performance was absolutely a short cover of epic proportions. I agree when you look at the picture this is a chart peaking in relative terms 18 months ago the relative money in the stock was made in the spring of 2018 not in 2019. And then when you look at the action today, dan, youre right. It was awful price action today. On top of that you think okay what are the competitors doing disney up today sharply charter traded well. Comcast trading weapon this seems to be a netflix problem. In the chart for 18 months you sell rally until it changes. Head to the website cnbc. Com we have more fast money straighted ahead here is whats coming up next. Announcer a bombshell report thats got all wall street talking today. Were futures traders reaping billions of dollars by front running the president s market moving remarks well talk with vanity fairs William Cohan whether the appropriating holds water. And later how options trader bet on cocacola earnings out tomorrow morning well break it down when fast money returns but in my mind im still 25. Thats why i take osteo biflex, to keep me moving the way i was made to. It nourishes and strengthens my joints for the long term. Osteo biflex now in triple strength plus magnesium. We believe in education built for all people. , [woman] snhu was the best experience of my life. [man] without snhu, i wouldnt be the leader i am today. [woman] i graduated high school 19 years ago. I still finished. [man] in the military, you feel that sense of accomplishment. Thats what snhu is. You will march from this arena and say to the world. I did it. [woman] you did it. I love you. [graduate] i love you too. We have a news alert on at t lets get to Julia Boorstin with the details. Melissa, Elliott Management sent its letter to the board of directors of at t outlining what it calls a compelling Value Creation opportunity for at t. The letter address ds to the Company Board says the opportunity could lead at t to at 60 pluses dollar per share value by the enof 2021, representing a 65 upside. Todays share price. And the letter says that elliott made the investment in at t among the largest ever because it says at t exhibits a unique existential of historical underperformance and depressioned well valuation, well positioned assets and clear path to generate extraordinary values for shareholders and other stakeholders the letter we are looking at right now outlines in time of the fact sort of how they have seen longterm underperformance appear what they would like to do to fix it. You see the at t shares up less than a in after hours trading thank you, julia, from los angeles. This is a farrell. If they resolve this it was a Short Campaign f