The fed has made a crucial mistake, and we may never recover. First, we start off with the markets. The dow ending lower by 254 points, the nasdaq in the red. The s p making both the new closing low and a new interday low. Finishing at levels not seen since april of 2014. So, new lows, now what . Guy . As it turns out, the headline comes out just as its making new lows, gets the market up 25 handles before we close at 1829. Now what is this . I wouldnt save tomorrows move. Its either going to be sub1800 or north of 1850. I wouldnt fade either one of them, because people will chase into what will be a long weekend. I still think the bond market is trying to tell you something. I think the headlines in oil were gazy, for lack of a better word. Tomorrow is not a day to fade. Not real. Thank you. Heres the deal. Listen, i said earlier in the week, i really do think were in a market that its one step forward, two steps back. It felt kind of bad, the lows today. It was fairly orderly. You get the Short Covering rally when theres news out of opec. Im of the camp that if we get a supply cut, and thats good for oil, i dont think its particularly great for the economy or our markets right now. I think it will get traded. To guys point, you could have the s p back at 1850, 1870 in one headline. Look, it was just we saw a tremendous round in selling earlier in the week. Today was very muted. We saw lack of buying interest really. Really no buyers inside in the institutional desk. Were coming into a long weekend. I think theres a lot of concern about that. I believe guys 100 right that you dont trade the first move. I think youll see a little bit of change in behavior tomorrow. Did you do anything today . I tell you what, i threw out a gold score which i quickly covered. I think theres a case where obviously we said gold is good. Right now, carters coming up to talk charts in general, but the gold chart is one you dont mess with. What were seeing is, i think re version of the meet, and a number of longterm trends. I would not discount the dollars move here. You want to find some positives. These guys are talking about oil. Whether its a fergazy, it underscores the negative feedback. Treasury yields were the most disturbing thing about it. We had a place here where i think youve got global Central Banks, insurance companies, trusts, anyone who has to invest in fixed income has the ability to invest here. Of course youre going to invest here. Why do you think yields are up 40 , because theres negative yields in a percentage of the worlds oil market. I think you get a whole lot of things with the dollar weaker. We hear this negative feedback a lot. It implies theres some sort of artificial thing going on here. I dont think thats the case. Look what happened in our stock market. Look at the performance. General motors closed down 3 . Toll brothers closed down 4 . Procter gamble closed down 2 . The guidance that most of them just gave today, we had pepsi, somethings going on. I dont know how you want to discount that, if thats what that means. Its very dismissive. No question something is going on. We clearly i dont think ive argued along the road that Global Growth that is slowed down. But to say banks are in trouble, i think banks are in trouble because people think they have enormous exposure to china and the european banks. So far, everyone that ive talked to says, if oil prices are higher, were going to see it speed through the economy. Oil prices didnt help on the way down. Why are they going to hurt at 20 bucks higher. Banks are in the worst case right now with the oil and gas defaults, what have you. I hear you. I hear you, but i dont know whats going on, and you dont know whats going on. Market sentiment. You have massive selling right now. Ill be interested in the world to not cause any panic. Thats whats going on. Im talking to guys in investment financials. When you see u. S. Banks for no reason down 40 in two months, somethings going on. We just dont know what it is. Lets talk about the earnings for the banks. The earnings acts for the banks in this environment is terrible. With yields going negative, they cant earn anything on their portfolios let alone on their deposits. You cant tell me the banks credit position is totally equated with their earnings positions. Their banks, multiples, the stock market is correcting. Multiples didnt make sense three months ago, where do they find the bottom . I dont know. Theres obviously look, blackstone, which we all love correctly into the summer, thats gone from 43 in june or july, it was down 6 today. Top of that, bank of america which we all agree valuationwise in the world we talk about is inexpensive. I dont know if that matters. The stock couldnt even bounce when the Broader Market bounced. Somethings happening in the banks. I dont know what it is. Im not suggesting i do. But clearly theres something the fed fund rate was only pricing 1 . So i dont know whats changed. It really isnt that big of a deal. How about 80 basis points on the tenyear. How about 60 basis points on the twoyear. The smart money was already there. I would rather talk about what guy was talking about which is blackstone. I think thats emblematic of where the market is. They make money through exit of deals. Through issuance of stock. Not them directly. Obviously theyre getting out of companies they bought. Its not in a market where its a premium multiple. Theres no liquidity. Why is blackstone going down . Thats why. Are they going out of business . I dont think so. But they could be holding some bad stuff. Heres my question that other people are probably asking, and that is, okay, lets say tim is right. Lets say there is nothing wrong with the banks right now except theyre in a terrible environment. Why should i still go ahead and buy this . The price action is terrible. Youre a very smart guy. Would you step in right now and buy the banks if you underperformed the market last year . How do you explain that to your investors . Youre not going to do it. Weve got a news alert here on jpmorgan and jamie diamond. Melissa, dow jones according to sources is reporting jpmorgans ceo jamie diamond is buying 500,000 shares, which amounts to roughly 26. 5 million. This, of course, following the dramatic decline in shares of jpmorgan, and other banks this year, jpmorgan down about 20 in 2016. Well keep you uptodate on the story. Thank you, seema modi. Hes putting his money where his mouth is. As he should. Look at what is going on over the last couple of months. Thats a significant thing. He believes in his company. As he absolutely should. What were talking about is something different. Yes, if i was the ceo of jpmorgan, i would feel great about things seeing where the stock traded down to. What dan and i are trying to say is, i dont understand whats happening. Dan is in the same camp. But something is going on. Is it systemic . I dont know. But the bank certainly trades as if it is. Jamie dimon made 27 million last year. Okay . Come on, guys, he owns 6 million shares already. This is out of the playbook. This is what we has to do. Hes going down with that ship one way or another if it ever goes down. Bro jackson, im not doing somersaults here because jamie dimon bought 2 million in stocks. Ceos are taking a look and saying i think my stock is cheap. The same as companies are saying ill buy back my stock here. What i want to respond to, i think its very clear, somethings going on, and i dont understand and im staying away. But that might be systemic, might be some massive credit thing like 2008. What im clearly saying is, i think banks are much less profitable. It doesnt mean im running and buying banks here. Bank of america, citibank and some longterm nonmanaged accounts . I think were speaking the same language. Were talking more fundamentals and valuation. Grab your spam and gold bars and head to the bunkers. You want to listen to our next guest. Heres what was said about Deutsche Bank back in september. Deutsche bank right now is literally on the lows of 2011 when the u. S. Got the debt downgrade. Weve tracked this line. Weve hovered here. To my eye, i think were going to break. It represents the end of the road. Now, going to break out here . Thats not my bet. I think well break down out of that. My bet is, Deutsche Bank breaks. Thats not good for banks, thats not good for equities. Biggest bank in europe, somethings wrong. Wow, was he right. Deutsche bank shares certainly collapsed. Carter, what is it . I want to look at longterm charts. There are certain signals, and history tells us when certain things are working a certain way, gold, treasury bonds, spreads, theyre happening after great periods of advance or strength, ill move quickly through these charts and go back. Look how the first one is utilities. Each chart has the recession of 1990. The recession of 01. And the recession of 08. This chart is identical to this chart which is identical to this chart which is identical to this chart. Lets start at the beginning. The first is, the blue line is s p 500. And when we know this is starting to hook down, and the relative performance of utilities starts to hook up, you typically are foreshadowing, because the market says were not in a recession, we have an earnings recession and industrial recession, but the call is were not in a recession. This is signaling were headed there. Utilities. The same exact setup, relative performance of tenyear bonds. When you start to get this kind of behavior, youre starting to suggest that youre about to get another contraction. Same thing with gold. Again, were starting to see this behavior where this is suggesting that youve got something thats reverting, and finally the spreads with corporates over treasuries. This is not a good setup. Its very hard to reverse it. Ultimately, as a minimum, i think were headed here. Two charts of the s p. That dot, you can draw it that way or that way. A pretty good Reference Point as you fall back to the level from which you broke out. That would simply take us to undo all the qe, and about 1575. That same dot, that Reference Point is exactly the still in the upper quadrant of the entire bull market since reagan took office. We bounced back from the low in the recession, touched it again in the 09 low. Im still talking only in the upper quadrant just to come back here, which would get us to the tops, 1575. I think thats just a question of when. Foregone conclusion, very much my view. Just a question of when. 1575. Carter, thank you. Carter worth of cornerstone macro. I think this side disagrees. I tell you what, i dont necessarily argue with charts that are showing history. And first of all, carters done a fantastic job with a number of different the forecast. Ultimately, im not telling you that i think stocks are going to go a lot higher. I think were in an environment where theres an enormous amount of volatility in the Central Banks. Im not wholesale selling stocks here. I think the world is coming to an end. I think theres a difference. He doesnt know the time horizon, i dont know the time horizon. Theres going to be rallies and big gap downs probably in the next six to nine months. Everything unclear right now. Youre just nodding. I will say this, carter is very handsome, and b, the march 09 low, the recent may high, 1575, 38. 2 . Closed below 1780 a couple of days, we trade there. Wow. Ill say this to be somewhat constructive. I think if we got to 1600, 1575 in the next few months, that is probably the best thing that could happen to m market. Look at valuation again. Look at longerterm prospects. We havent anything more than 10 , 11 in years. I would love it at 1600. You all should love it there. Up next, twitter is tanking. Now its a buy. Whats changed . Global markets get creamed. Get this, positive not just this year, but last year. Moments ago, Hedge Fund Manager john paulson telling cnbc the floor for stocks has not been reached. Well hear just how low he thinks stocks can go, right after this. Property being stolen. L that is cybercrime and it affects each and every one of us. Microsoft created the digital crimes unit to fight cybercrime. We use the microsoft cloud to visualize information so we can track down the criminals. When it comes to the cloud, trust and security are paramount. Were building what we learn back into the cloud to make people and organizations safer. Wont keep you up at night. N know you have insights from professional investment strategists to help set your mind at ease. Know that planning for retirement can be the least of your worries. With the guidance of a pnc investments financial advisor, know you can get help staying on track for the future youve always wanted. Welcome back it fast money. A news alert out of puerto rico. Michelle is this. Hey there, melissa. Were here in puerto rico, because john paulson is a big investor in puerto rico, many hotels here. We sat down with him to talk about his investments in puerto rico, but also to talk about his opinions of the market right now and the volatility. He thinks there is a disconnect between the u. S. Economy and whats happening in the market. That the Portfolio Companies they have are doing well and the stocks are getting hit regardless of the fundamentals. That being said, he also made it clear hes not diving in headfirst when asked if hes trying to seize on any opportunities of cheap stocks here. You know, the markets still falling. So anything you buy goes lower. You know, its getting near the point where theres certainly a lot of value out there. At the same time we wanted to get his opinion on what was happening particularly in relation to the european banking system, which has shown so many signs of distress lately, and whether or not that could feed over in a meaningful way into the u. S. Banking system. He said no. Banks are extraordinarily well capitalized. They have much lower leverage and a lot of liquidity, and a much Higher Quality credit portfolio. So the u. S. Is on pretty solid ground. I think the concerns will not be in the u. S. , but more from china, where theres concerns about their financial system, the at of credit theyve extended and the health of the chinese credit partners. To be clear, john paulson does not actually own puerto rican debt which has been in the news lately, when they had a fight with the bond holders trying to restructure the debt. Great topics. Michelle, hes been a strong investor in the past in the shale. And shale equities as well as pharmaceuticals. Is he still active . Does he see value there . We didnt discuss that. We did discuss gold, which, of course, has been doing well. He said it has been performing well. He didnt want to give a lot of details about actual performance as you can imagine trying to get details out of him, not easy. Right. Michelle, thank you. Michelle carusocabrera for us in puerto rico. I think hes got the sentiment of a lot of investors right now. Thats what we were trying to convey. That message sounded very similar. I heard the word dislocation. That the u. S. Economy is not representative of whats going on in the market. That hes concerned about china. Now, what these guys would say, im going to speak for Bro Jay Simpson and jackson over here, what it means for european banks, is what it would mean for the u. S. Banks. I think its fair the argument these guys are about to give, thats impossible. You cant disconnect china from u. S. Banks. Speak for yourselves now. Hes had horrendous years. In 2014, lost 35 . In 2011 what im saying is, probably off of peak assets, too. This is one of the largest investors in the world. Why do i really care . Because i have to assume that hes very cautiously positioned right now, if those are his concerns. To me, you know, its a lot of saying one thing and doing another. My concern is, when bank of japan went negative Interest Rates, i think that gave didnt speak to china, but to me gave the chinese every possible conceivable reason to devalue their currency. We saw it on august 11th, i believe, when the first selloff started. I think youll see a massive devaluation there. I think its negative for our markets. I still think you have this global race in currencies to zero which are why people are waking up to gold. All right. Still ahead, janet yellen failing to calm the market today with her second day of testimony on capitol hill. Thats got one former fed chair up in arms. He said the fed made a crucial mistake. Hell tell us what that is a little bit later on. Heres what else is coming up on fast. Were going to cut out their living guts and use them to grease the treads of our tanks. Thats what bank of america says is happening to some mega cap tech stocks. It could spell doom for the nasdaq. Plus, you can try, drago, but there are four stocks in the market that have proven to be unbreakable. Well give you the names and tell you if you can still buy them, when fast money returns. In new york state, we believe tomorrow starts today. All across the state the economy is growing, with creative new business incentives, and the lowest taxes in decades, attracting the talent and companies of tomorrow. Like in the hudson valley, with world class biotech. And on long island, where great universities are creating next generation technologies. Let us help grow your companys tomorrow, today at business. Ny. Gov the market may seem like a sea of red, but there are some stocks that have rallied in the recent turmoil. Looking at some of the seemingly unbreakable stocks, a man himself who never breaks. Hi, dom. Melissa, i dont know about unbreakable, but i try not to break. I try to bend a lot, but try not to break. We wanted to look at some of these stocks. What we decided to look at were s p 500 companies that had positive yeartodate returns as well as positive 12month rirns. Only 340 companies passed that test. Here are a handful of them. First off youve got an interesting one here in terms of the one thats actually hit an alltime high in recent trading, tyson food, up about 14 yeartodate. Then youve got mattel on the toy side of things. A laggard for a while, but earlier this year up 10 yeartodate. As for campbells soup, look at this one, up 8 yeartodate. Another part of the consumer theme. Reynolds american, tobacco company, bigger yield, up about 3 over the yeartodate period, 32 over past 12 months. Cam bells, tysons, Reynolds American have held up yeartodate and on a 12month basis. At least for right now, perhaps looking at a little more on the unbreakable side of things. Thank you, dom. Dom chu. Barely bends. We broke poor dom. I would say there is a problem that youre chasing performance at this point. Tyson is a crazy expensive. Surprisingly, approaching 10 . You know, 3 , 4 off the alltime highs. I dont think youre chasing it. I think its clearly telling you that in this environment, stocks that can be around alltime high, something is going on. You find stocks that outperform, and allow these takes. Tyson is one