Transcripts For CNBC Fast Money 20160615 : vimarsana.com

First, we start with the fed officially standing pat, so we asked the question, steve liesman, is the fed on hold forever . What do you think . I dont think its on hold forever, but i can understand why you would ask that question. I think the story here is that the fed probably not going to move in july. I saw a ubs headline saying, take the summer off. We are. When it comes to at least whats going to happen to fed policy. Janet yellen and the fed keeping the rates on hold today, and not suggesting any big hurry in terms of hiking Interest Rates. But the big story today is what they did to a their outlook for rates over the next several years. And they brought them down quite substantially. We suggested all day, including yesterday, that that was probably what the fed would do today. I have to say, i was somewhat surprised. When you look at the chart of what the fed now says its going to do with Interest Rates, look at the last five meetings. Now at just 2. 4 for 2018, that had been above 3 . 2017, 1. 6 . Again, that has been around 3 . Left at unchanged for 2016, but the importance of that perhaps is that before this meeting, only one fed official said one hike this year, now theres six. Theres some debate whether or not the fed does one or two. I think the fed still wants to raise rates but its going to wait until it sees the whites of the eyes of the better economic growth. I asked janet yellen, why did you bring rates down so much from your outlook. She talked about the neutral rate and suggested that some of the things that are headwinds today could be permanent. I think what you see is a downward shift in that assessment over time, the sense that maybe more of whats causing this neutral rate to be low, are factors that are not going to be rapidly disappearing but part of the new normal. Thats a pretty big shift for the Federal Reserve to say some of the things that have held us back are going to be around for quite a while. You notice what it did is it lowered those rates, 2. 4 in 2018. But didnt give you any more growth. The forecast for growth is still 2 . That tells you that the fed rate is lower than it was before, melissa. Steve, just the other day you were giving us results of the survey, and brexit wasnt important to most economists. Do you think i mean, did she say anything specifically about the brexit and what the impact would be . By flagging it, it suggests this could be an impact here that other economists are not saying. So just to be clear, brexit itself was not in the statement. They talked about monitoring Global Economic and financial developments. Brexit did make an appearance in the press conference where she was asked about that. And she said, yeah, it was one of the reasons we held fast today because of the uncertainty surrounding brexit. I still dont see the fed saying its a very big deal. I think its a potential tell risk to the u. S. Economy, but even if the uk were to leave the european union, their base forecast would be a very, very negative effect on the u. S. Perhaps a slight negative. But when you look at the total trade between the u. S. And the uk, you dont see a really big number there. All right. Thank you very much, steve liesman, joining us from washington, d. C. Now it looks like the fed is on pause for a while, what does it mean for the u. S. Markets . Interesting we saw late day selloff after the press conference. What does it mean for the broader markets . I think the longer they wait, the more people say what do they know that the rest of us dont know, that the rest of us might not be looking at . Listen, i think if they raise rates, in my opinion, it would have given them maybe a shortterm gain in the market. But a credibility they dont have. I think pete was in agreement with me, the last couple of months all kinds of fed officials saying, getting us ready for raising in june. The only thing that changed, in my opinion, was the lousy job number. Unemployment rate actually went down. All the things they say, the benchmarks are improving. How do you gain credibility by hiking into an economy that cant support it. I hear what youre saying. Youre frustrated that maybe three weeks ago we had this barrage of fed officials setting you up for a june hike. Thats fair, except for the fact they didnt have the payroll number. And the fed to me that is going because they have to go, is irresponsible as opposed to one on hold. If the fed told me today they think the u. S. Economy is in such good shape and theyre not worried about brexit, i mean, why would they go ahead of brexit t. Makes no sense. This is not a it didnt just happen overnight. This is nothing they talked about two months ago but the polls are well, okay. If thats what theyre focused on, the poll, they knew this would be a potential to happen, three months when they started hiking in june. They never mentioned it once. Okay. So basically today, what we saw was sor of a rorschach test for the markets. Rorschach . Thats completely different. You could either read it as the fed is basically confessing that the growth is not there, or that, you know what, these conditions that have led to markets going to near alltime highs will be in place one market. The s p 500. And i think thats really important to isolate that market. We look at equity markets all over the world. Theyre actually performing very poorly. Especially the ones where Interest Rates have gone negative. Thats an important chart. In my mind it sets up disastrously, almost similar to last summer. Look at the three consolidations over the last year and a half or so, how did they give way. They gave way lower, in sharp spikes, down about 10 . When you think about it, the path of least resistance when were consolidating back to the higher is not higher. It takes something external to kind of send this lower. I think miss yellens acknowledgement today of lower growth here is the very thing that could drag Global Growth lower. The s p is a crowded trade, not where you want to be. We have one other chart thats really important to me. What happened in february, i know a lot of you want to take victory laps because you got the huge move back, look at that low in february. That was below the uptrend that had been in place since 2009. It was the first lower low in the entire 200plus percent rally. Thats where i believe were going back to this summer. Ill tell you something very important, and different than what happened in february. She talked about all the uncertainties. We get 15 times she used the word uncertainty. She used it again today when she talked about brexit. Add the fed with brexit, we watched from thursday, volatility go from 14, where its been low forever it seems like, ever since we finally came out of the difficulties in february, suddenly youve got a low volatility environment, we spiked to 22 yesterday. We actually closed back towards 20, a little bit below. Here we are once again above 20. The 20 to 25 area in volatility, thats always brought up. That is a difficult investing time for anybody. I agree with them. Does that mean that in this environment, now that weve heard what janet yellen has to say, it is not an environment that favors the favored safety trades that had helped us move higher. Utilities okay, stick with the trades . First of all, youre saying nothing else other than the s p is but youve been saying the s p is going to be going down for the last three months. Youre talking about the s p but it doesnt go anywhere higher. Im telling you it doesnt have to exist. Markets are not correlated, the reverse in the mean trades that are three, four, five years in the making. So emerging is underperformed the developed markets for the last five years. They outperformed them this year. Commodities are outperforming. Outperforming after a crash, brother. What are you talking about . When im looking at the s p, im not short the s p. Im looking at some of the weaker sisters like the russell 2000. When you look at the s p as this crowded trade, as a safety trade, im telling you, its not safe. Its made two lower lows since last may or two lower highs, excuse me, since last may. February low is very important. I think from a technical standpoint. I think the conditions that the bull market in the s p, i think the safety in the s p is the fact that its been rotational. If it was just any one factor, one segment that was driving it, even if it was just the financials driving it, i would be concerned. But its not. Its tech, its financials you lost the biggest leader in the whole bull market. Youve lost goldman sachs. The list goes on. Nike. Disney, goldman sachs, starbucks, youre right. Even last year since the highs a little bit of facebook recently. People talked about bank stocks driving this thing. We were just bumping up against the highs of the s p, right . The rotational aspect of what weve been seeing i think is very healthy for the marketplace, that its not just one stock or the rotation is breadth. Your point about technicals on the s p is fair. Youre saying lower lows. The reality is there is a ton of cash on the sidelines. Weve been bumping up against you know all the stats and bank of america guys do great work on this, but you get to a place where its over 300 days where youve had the 52week high. Technicals tell me its going to go a lot higher. You continue to talk about the s p, but it continues to grind in this sideways action. I dont see that changing. Its not sideways. Energy, materials, all this stuff, that crashed, theyre actually broken. Its hovering around 2100, not the leadership thats going to make a meaningful breakout to new highs. The russell is turning over. The iwm seems to be headed back in a downtrend since may of last year. The transports which led us up to the upside back in january, they seem to be rolling over as well. So the two of the major components of the market rolled. The s p is at a whisper of an alltime high. Two things that make it up seem to be rolling over to the down side. Take a look at the tenyear yield hitting multiyear lows today. How much lower can it go. Mike from bank of America Merrill lynch is here. Great to see you. Great to be here. How low can it go, and what was your interpretation of what yellen said today . A lot of things that we can talk about. I actually agree with pieces of what everybodys said up here today. Very diplomatic. Volatility is key. Im a big believer in looking at volatility. Implied volatility is one of the best things to look at in terms of what happens and where the markets go in terms of direction, right . In my world, in the Corporate Bond world, you want the certainty of coupon of principle. Rates could go lower. You have 10 trillion of negative yield assets globally. Treasuries, u. S. Investment grade, and u. S. High yield are virtually some of the only Assets Available right now with a positive yield. Theres going to be a very strong sec nick al, i think, despite the fact that technicals very week. Fundamentals are week, right . Lets call it what it is. We have a peter pan economy. A peter pan economy is an economy that just doesnt want to grow up. If you think about it, yellens job is to spur inflation and growth. Its the baby the economies forward. Its just not happening, though. What i worry about is fundamental earnings are weak. Look at the s p, russell, look at high yield, look at investment grade, earnings are weak. Were at, what, 20 or so, in terms of pe on the s p 500. You look at debt to high yield, alltime highs. How are you going to grow into your capital structure . How are you going to increase equity multiples . There are two ways to do that. Either you cut costs, cut cap x, or fire your unproductive labor force. At least stop hiring. I think were starting to see a slowing in the labor force, because frankly, weve got a tight labor market. That sounds like a stagnant picture in terms of corporate america. What sort of environment is this in terms of default . Is it just a stagnant environment or does it actually get worse to the point where it affects your world and you see sort of different sorts of default across sectors . This is what pete was talking about earlier. I call it a rolling blackout. Coal, metals, mining, energy, pieces of retail, theyre realizing their blackout moments, moment of distress. It might be a period of time where the next sector realizes its blackout moment. Maybe its health care because of regulation. Maybe its telecom because why do i need to be an overlevered Telecom Player when netflix, amazon and google can come in with all the cash available to them and price me out of the market. I think it could be six, nine, 12 months. One of the things weve seen is a lot of the resource companies, the em, the worst credits out there have not only been coming to market, but able to refi debt at significantly lower rates. Thats what this is supposed to do. Sure. The rolling blackout period means a lot of these industries have gone through painful restructuring, no bad projects, and forces them ultimately to be better stewards of capital. Im not saying this is ultimately good. But i look at resources, and again, okay, big move down, okay. The reality is, whats the trade for tomorrow . A lot of these guys have Balance Sheets where theres a significant environment for them to refi debt at rates they could only dream about last year. I think thats a hundred percent right. Thats still very rare cases. Look at high yield, only 11 have tapped Capital Market in the last 12 months. Thats a very anemic number. Even in 09 you had one off ccc debt pricing. If youre not lets be honest, if youre not coming to market today, youre foolish as a cfo. You should be coming to market today, because markets are open, too. And thats at the Higher Quality of portions of the market. The one after cccs are going to happen, but theyre not going to be that frequent. Michael, weve got to leave it there. Always great to see you. Thank you. Lets trade this. Its interesting. We have a sort of a divide on the desk. Pete, what do you do here . I think to michaels point how hes looking at the volatility, when i look at it trading a little above 20, and until we get back below the 200day moving average for a substantial number of days, maybe longer than that, i think its a very difficult investing environment. I think if you are, and you want to be involved, there are names that are getting hit to the down side. If you want to choose to get in them, use that volatility at a higher level. Youll get paid more premium against those names. What did you trade today . Today i didnt do as much as i did yesterday. Yesterday i was very active. Actually, quite a few Different Energy names. Because we continue to see unusual activity there. I bought into something in the solar space, first solar yesterday. Bought some first solar. Ill hold on for a short time. Eem, bought some eem. I didnt realize yellen would be as dovish as she sounded. Im looking at my chart, its down. Im not making a call except i am making a statement that i think eem was oversold on dollar perception and we have a place where things have gotten significantly different there. One staple stock is plunging. One of the worse performers on the s p 500 today. The name and whether theres more pain ahead. The former ceo of viacom, tom freston will join us for a rare and exclusive interview. Who he says is to blame on what went wrong behind the scenes. Approaching medicare eligibility . Dont put off checking out your Medicare Options until 65. Now is a good time to get the ball rolling. Medicare only covers about eighty percent of part b medical costs. The rest is up to you. Thats where aarp Medicare Supplement insurance plans insured by Unitedhealthcare Insurance Company come in. Like all standardized Medicare Supplement insurance plans, they could help save you in outofpocket medical costs. Taking informed steps really makes a difference later. Thats what it means to go long™. Call now and request this free decision guide and explore the range of aarp Medicare Supplement plans. All plans like these let you choose any doctor or hospital that accepts medicare patients. These are the only Medicare Supplement insurance plans endorsed by aarp. Call now and request your free decision guide. And start gathering the information you need to help you go long™. Another tough day for whole foods. Falling 4. 5 after getting slapped with a warning letter from the fda earlier this month. Today whole foods getting downgraded by north Coast Research to sell from new tal on the back of that warning. You read some of the letter, its food exposed to dripping condensati condensation, listeria found on equipment stop. Problems with the handwashing procedure. You need to excuse yourself right now . Sounds like chipotle. Its one facility. And i think you have to think about the chipotle thing. That was only a few stores. Their earnings went from 15 to 4. 5. I wont say that will happen here at whole foods. I know some of the results recently were okay. The stock got above 35 for the first time in a while. Its since given all of that back here. If you want to take a shot down towards 30, use 28 1 2 low, that is really this triple bottom thats been banging around for the last eight months here. But be careful of this one. Weve seen what happened to chipotle. It kept making lower lows. The news got incrementally worse, but there wasnt a heck of a lot of new news either. Trades like where kroegers is trading like a couple of years ago. Just a different day for whole foods. The valuation has come down considerably. The competition is still the same. Valuation has come back down. Oracle gearing up for tomorrow. Betting on more than a 4 move in the stock. Heres what else ais coming up n fast. England as fears of a brexit heats up, four stocks could be uniquely vulnerable. Well give you the names. I want my mtv the man behind the mtv networks and ceo tom freston speaks out in an exclusive interview. What went wrong in his former company. Whos to blame. And would he return as ceo. Tom freston reveals all when fast money returns. Its a gret the right the one for her . Is this really any better than the one you got last year . If we consolidate suppliers whats the savings there . So should we go with the 467 horsepower . Or is a 423 enough . Good question. You ask a lot of good questions. I think we should move you into our new fund. Ok. Sure. But are you asking enough about how your wealth is managed . Wealth management, at charles schwab. Before a bunch of dreamers land said, why not . And Interest Rates<\/a>. But the big story today is what they did to a their outlook for rates over the next several years. And they brought them down quite substantially. We suggested all day, including yesterday, that that was probably what the fed would do today. I have to say, i was somewhat surprised. When you look at the chart of what the fed now says its going to do with Interest Rates<\/a>, look at the last five meetings. Now at just 2. 4 for 2018, that had been above 3 . 2017, 1. 6 . Again, that has been around 3 . Left at unchanged for 2016, but the importance of that perhaps is that before this meeting, only one fed official said one hike this year, now theres six. Theres some debate whether or not the fed does one or two. I think the fed still wants to raise rates but its going to wait until it sees the whites of the eyes of the better economic growth. I asked janet yellen, why did you bring rates down so much from your outlook. She talked about the neutral rate and suggested that some of the things that are headwinds today could be permanent. I think what you see is a downward shift in that assessment over time, the sense that maybe more of whats causing this neutral rate to be low, are factors that are not going to be rapidly disappearing but part of the new normal. Thats a pretty big shift for the Federal Reserve<\/a> to say some of the things that have held us back are going to be around for quite a while. You notice what it did is it lowered those rates, 2. 4 in 2018. But didnt give you any more growth. The forecast for growth is still 2 . That tells you that the fed rate is lower than it was before, melissa. Steve, just the other day you were giving us results of the survey, and brexit wasnt important to most economists. Do you think i mean, did she say anything specifically about the brexit and what the impact would be . By flagging it, it suggests this could be an impact here that other economists are not saying. So just to be clear, brexit itself was not in the statement. They talked about monitoring Global Economic<\/a> and financial developments. Brexit did make an appearance in the press conference where she was asked about that. And she said, yeah, it was one of the reasons we held fast today because of the uncertainty surrounding brexit. I still dont see the fed saying its a very big deal. I think its a potential tell risk to the u. S. Economy, but even if the uk were to leave the european union, their base forecast would be a very, very negative effect on the u. S. Perhaps a slight negative. But when you look at the total trade between the u. S. And the uk, you dont see a really big number there. All right. Thank you very much, steve liesman, joining us from washington, d. C. Now it looks like the fed is on pause for a while, what does it mean for the u. S. Markets . Interesting we saw late day selloff after the press conference. What does it mean for the broader markets . I think the longer they wait, the more people say what do they know that the rest of us dont know, that the rest of us might not be looking at . Listen, i think if they raise rates, in my opinion, it would have given them maybe a shortterm gain in the market. But a credibility they dont have. I think pete was in agreement with me, the last couple of months all kinds of fed officials saying, getting us ready for raising in june. The only thing that changed, in my opinion, was the lousy job number. Unemployment rate actually went down. All the things they say, the benchmarks are improving. How do you gain credibility by hiking into an economy that cant support it. I hear what youre saying. Youre frustrated that maybe three weeks ago we had this barrage of fed officials setting you up for a june hike. Thats fair, except for the fact they didnt have the payroll number. And the fed to me that is going because they have to go, is irresponsible as opposed to one on hold. If the fed told me today they think the u. S. Economy is in such good shape and theyre not worried about brexit, i mean, why would they go ahead of brexit t. Makes no sense. This is not a it didnt just happen overnight. This is nothing they talked about two months ago but the polls are well, okay. If thats what theyre focused on, the poll, they knew this would be a potential to happen, three months when they started hiking in june. They never mentioned it once. Okay. So basically today, what we saw was sor of a rorschach test for the markets. Rorschach . Thats completely different. You could either read it as the fed is basically confessing that the growth is not there, or that, you know what, these conditions that have led to markets going to near alltime highs will be in place one market. The s p 500. And i think thats really important to isolate that market. We look at equity markets all over the world. Theyre actually performing very poorly. Especially the ones where Interest Rates<\/a> have gone negative. Thats an important chart. In my mind it sets up disastrously, almost similar to last summer. Look at the three consolidations over the last year and a half or so, how did they give way. They gave way lower, in sharp spikes, down about 10 . When you think about it, the path of least resistance when were consolidating back to the higher is not higher. It takes something external to kind of send this lower. I think miss yellens acknowledgement today of lower growth here is the very thing that could drag Global Growth<\/a> lower. The s p is a crowded trade, not where you want to be. We have one other chart thats really important to me. What happened in february, i know a lot of you want to take victory laps because you got the huge move back, look at that low in february. That was below the uptrend that had been in place since 2009. It was the first lower low in the entire 200plus percent rally. Thats where i believe were going back to this summer. Ill tell you something very important, and different than what happened in february. She talked about all the uncertainties. We get 15 times she used the word uncertainty. She used it again today when she talked about brexit. Add the fed with brexit, we watched from thursday, volatility go from 14, where its been low forever it seems like, ever since we finally came out of the difficulties in february, suddenly youve got a low volatility environment, we spiked to 22 yesterday. We actually closed back towards 20, a little bit below. Here we are once again above 20. The 20 to 25 area in volatility, thats always brought up. That is a difficult investing time for anybody. I agree with them. Does that mean that in this environment, now that weve heard what janet yellen has to say, it is not an environment that favors the favored safety trades that had helped us move higher. Utilities okay, stick with the trades . First of all, youre saying nothing else other than the s p is but youve been saying the s p is going to be going down for the last three months. Youre talking about the s p but it doesnt go anywhere higher. Im telling you it doesnt have to exist. Markets are not correlated, the reverse in the mean trades that are three, four, five years in the making. So emerging is underperformed the developed markets for the last five years. They outperformed them this year. Commodities are outperforming. Outperforming after a crash, brother. What are you talking about . When im looking at the s p, im not short the s p. Im looking at some of the weaker sisters like the russell 2000. When you look at the s p as this crowded trade, as a safety trade, im telling you, its not safe. Its made two lower lows since last may or two lower highs, excuse me, since last may. February low is very important. I think from a technical standpoint. I think the conditions that the bull market in the s p, i think the safety in the s p is the fact that its been rotational. If it was just any one factor, one segment that was driving it, even if it was just the financials driving it, i would be concerned. But its not. Its tech, its financials you lost the biggest leader in the whole bull market. Youve lost goldman sachs. The list goes on. Nike. Disney, goldman sachs, starbucks, youre right. Even last year since the highs a little bit of facebook recently. People talked about bank stocks driving this thing. We were just bumping up against the highs of the s p, right . The rotational aspect of what weve been seeing i think is very healthy for the marketplace, that its not just one stock or the rotation is breadth. Your point about technicals on the s p is fair. Youre saying lower lows. The reality is there is a ton of cash on the sidelines. Weve been bumping up against you know all the stats and bank of america guys do great work on this, but you get to a place where its over 300 days where youve had the 52week high. Technicals tell me its going to go a lot higher. You continue to talk about the s p, but it continues to grind in this sideways action. I dont see that changing. Its not sideways. Energy, materials, all this stuff, that crashed, theyre actually broken. Its hovering around 2100, not the leadership thats going to make a meaningful breakout to new highs. The russell is turning over. The iwm seems to be headed back in a downtrend since may of last year. The transports which led us up to the upside back in january, they seem to be rolling over as well. So the two of the major components of the market rolled. The s p is at a whisper of an alltime high. Two things that make it up seem to be rolling over to the down side. Take a look at the tenyear yield hitting multiyear lows today. How much lower can it go. Mike from bank of America Merrill<\/a> lynch is here. Great to see you. Great to be here. How low can it go, and what was your interpretation of what yellen said today . A lot of things that we can talk about. I actually agree with pieces of what everybodys said up here today. Very diplomatic. Volatility is key. Im a big believer in looking at volatility. Implied volatility is one of the best things to look at in terms of what happens and where the markets go in terms of direction, right . In my world, in the Corporate Bond<\/a> world, you want the certainty of coupon of principle. Rates could go lower. You have 10 trillion of negative yield assets globally. Treasuries, u. S. Investment grade, and u. S. High yield are virtually some of the only Assets Available<\/a> right now with a positive yield. Theres going to be a very strong sec nick al, i think, despite the fact that technicals very week. Fundamentals are week, right . Lets call it what it is. We have a peter pan economy. A peter pan economy is an economy that just doesnt want to grow up. If you think about it, yellens job is to spur inflation and growth. Its the baby the economies forward. Its just not happening, though. What i worry about is fundamental earnings are weak. Look at the s p, russell, look at high yield, look at investment grade, earnings are weak. Were at, what, 20 or so, in terms of pe on the s p 500. You look at debt to high yield, alltime highs. How are you going to grow into your capital structure . How are you going to increase equity multiples . There are two ways to do that. Either you cut costs, cut cap x, or fire your unproductive labor force. At least stop hiring. I think were starting to see a slowing in the labor force, because frankly, weve got a tight labor market. That sounds like a stagnant picture in terms of corporate america. What sort of environment is this in terms of default . Is it just a stagnant environment or does it actually get worse to the point where it affects your world and you see sort of different sorts of default across sectors . This is what pete was talking about earlier. I call it a rolling blackout. Coal, metals, mining, energy, pieces of retail, theyre realizing their blackout moments, moment of distress. It might be a period of time where the next sector realizes its blackout moment. Maybe its health care because of regulation. Maybe its telecom because why do i need to be an overlevered Telecom Player<\/a> when netflix, amazon and google can come in with all the cash available to them and price me out of the market. I think it could be six, nine, 12 months. One of the things weve seen is a lot of the resource companies, the em, the worst credits out there have not only been coming to market, but able to refi debt at significantly lower rates. Thats what this is supposed to do. Sure. The rolling blackout period means a lot of these industries have gone through painful restructuring, no bad projects, and forces them ultimately to be better stewards of capital. Im not saying this is ultimately good. But i look at resources, and again, okay, big move down, okay. The reality is, whats the trade for tomorrow . A lot of these guys have Balance Sheets<\/a> where theres a significant environment for them to refi debt at rates they could only dream about last year. I think thats a hundred percent right. Thats still very rare cases. Look at high yield, only 11 have tapped Capital Market<\/a> in the last 12 months. Thats a very anemic number. Even in 09 you had one off ccc debt pricing. If youre not lets be honest, if youre not coming to market today, youre foolish as a cfo. You should be coming to market today, because markets are open, too. And thats at the Higher Quality<\/a> of portions of the market. The one after cccs are going to happen, but theyre not going to be that frequent. Michael, weve got to leave it there. Always great to see you. Thank you. Lets trade this. Its interesting. We have a sort of a divide on the desk. Pete, what do you do here . I think to michaels point how hes looking at the volatility, when i look at it trading a little above 20, and until we get back below the 200day moving average for a substantial number of days, maybe longer than that, i think its a very difficult investing environment. I think if you are, and you want to be involved, there are names that are getting hit to the down side. If you want to choose to get in them, use that volatility at a higher level. Youll get paid more premium against those names. What did you trade today . Today i didnt do as much as i did yesterday. Yesterday i was very active. Actually, quite a few Different Energy<\/a> names. Because we continue to see unusual activity there. I bought into something in the solar space, first solar yesterday. Bought some first solar. Ill hold on for a short time. Eem, bought some eem. I didnt realize yellen would be as dovish as she sounded. Im looking at my chart, its down. Im not making a call except i am making a statement that i think eem was oversold on dollar perception and we have a place where things have gotten significantly different there. One staple stock is plunging. One of the worse performers on the s p 500 today. The name and whether theres more pain ahead. The former ceo of viacom, tom freston will join us for a rare and exclusive interview. Who he says is to blame on what went wrong behind the scenes. Approaching medicare eligibility . Dont put off checking out your Medicare Options<\/a> until 65. Now is a good time to get the ball rolling. Medicare only covers about eighty percent of part b medical costs. The rest is up to you. Thats where aarp Medicare Supplement<\/a> insurance plans insured by Unitedhealthcare Insurance Company<\/a> come in. Like all standardized Medicare Supplement<\/a> insurance plans, they could help save you in outofpocket medical costs. Taking informed steps really makes a difference later. Thats what it means to go long\u2122. Call now and request this free decision guide and explore the range of aarp Medicare Supplement<\/a> plans. All plans like these let you choose any doctor or hospital that accepts medicare patients. These are the only Medicare Supplement<\/a> insurance plans endorsed by aarp. Call now and request your free decision guide. And start gathering the information you need to help you go long\u2122. Another tough day for whole foods. Falling 4. 5 after getting slapped with a warning letter from the fda earlier this month. Today whole foods getting downgraded by north Coast Research<\/a> to sell from new tal on the back of that warning. You read some of the letter, its food exposed to dripping condensati condensation, listeria found on equipment stop. Problems with the handwashing procedure. You need to excuse yourself right now . Sounds like chipotle. Its one facility. And i think you have to think about the chipotle thing. That was only a few stores. Their earnings went from 15 to 4. 5. I wont say that will happen here at whole foods. I know some of the results recently were okay. The stock got above 35 for the first time in a while. Its since given all of that back here. If you want to take a shot down towards 30, use 28 1 2 low, that is really this triple bottom thats been banging around for the last eight months here. But be careful of this one. Weve seen what happened to chipotle. It kept making lower lows. The news got incrementally worse, but there wasnt a heck of a lot of new news either. Trades like where kroegers is trading like a couple of years ago. Just a different day for whole foods. The valuation has come down considerably. The competition is still the same. Valuation has come back down. Oracle gearing up for tomorrow. Betting on more than a 4 move in the stock. Heres what else ais coming up n fast. England as fears of a brexit heats up, four stocks could be uniquely vulnerable. Well give you the names. I want my mtv the man behind the mtv networks and ceo tom freston speaks out in an exclusive interview. What went wrong in his former company. Whos to blame. And would he return as ceo. Tom freston reveals all when fast money returns. Its a gret the right the one for her . Is this really any better than the one you got last year . If we consolidate suppliers whats the savings there . So should we go with the 467 horsepower . Or is a 423 enough . Good question. You ask a lot of good questions. I think we should move you into our new fund. Ok. Sure. But are you asking enough about how your wealth is managed . Wealth management, at charles schwab. Before a bunch of dreamers land said, why not . And Collaboration Tools<\/a> from intel made Rocket Science<\/a> simple for actual rocket scientists. And the launch crew met for a moment of reflection. Before any of this, cdw orchestrated a collaboration solution using pcs with intel 6th gen core vpro processors. Collaboration by intel. Orchestration by cdw. Welcome back to fast money. The race to the breks ilt is on with just eight days until the big vote. What are some u. S. Stocks that could run into trouble if they do leave the european union. Hey, dom. Were just over a week away, melissa, and thats when all that brexit talk comes to a head. In anticipation of the big day, we wanted to take a look at some of the u. S. Companies that have the most exposure to business around europe, and specifically the united kingdom. According to data from fact set, it turns out there are just a handful of companies in the s p 500 that have at least 10 of total revenues from both europe and specifically the united kingdom. Just around 29 of them. Among the notable names on the list, how about a reit to king things off. Were talking Computer Data<\/a> company, properties all over the world. 37 of revenues come from europe. 17 of revenues from the uk specifically. Ebay gets around 38 of sales from europe, 16 from the uk. Insurance anyone, anyone . Xl group gets 44 from europe, half of that amount is from the uk. Its definitely 5 00 somewhere, especially times square, so who couldnt use a beer. Molson coors gets a third from the uk. Its not to say any of these revenues are in serious danger, but something traders are keeping an eye on. Back over to you guys. Thank you very much, dom chu. Is this in fact a tradeable event in a stockspecific way . I think it is. You have to look at a number of names. Maybe even from the uk side. Stocks that have more exposure to north america. Carnival cruises. Either way, europe is a three standard deviation oversold u. S. Stocks right now. Thats the opportunity. Heres the opportunity to stay away from the banks in general. I think if youre worried that a lot of the reason european banks are selling off, or u. S. Banks that have exposure in europe, it doesnt matter. If we get to the brexit thing and they vote to stay, i think the european banks continue to go lower. I think you avoid that, if thats what you believe theyre going down for. Viacom, tom freston in the building for a rare and exclusive interview. Who does he think is to blame at viacom . So many questions, one big interview for you right after this break. Every year, the amount of data your enterprise uses goes up. Smart devices are up. Cloud is up. Analytics is up. Seems like everything is up except your budget. Introducing comcast Business Enterprise<\/a> solutions. With a different kind of network that delivers the bandwidth you need without the high cost. Because you cant build the business of tomorrow on the network of yesterday. Shoshow me more like this. E. The business of tomorrow show me previously watched. Whats recommended for me. X1 makes it easy to find what you love. Call or go online and switch to x1. Only with xfinity. Welcome back to fast money. Janet yellen signaled we may only see one hike this year. The dow and s p now in the middle of the worst losing streak in four months. Heres whats coming up in the second half of the show. The one stock that some traders see surging near multiyear highs by the end of this week. Well tell you what it is and how you can get in. Were moments away from our exclusive interview with former viacom ceo tom freston. Julia boorstin is in los angeles with the latest. Sources at viacom say the morale is, quote, terrible, as theres more news of executive departures. The latest is head of reality tv at mtv, following the president of nickelodeon earlier this month. Last month, Comedy Central<\/a>s president. This is viacoms networks suffering rating declines. Paramount suffered from a string of disappointments. Viacom has had really too much rotation on executive ranks, including people running the networks and the creative side. I think you really need continuity. I think the human relationships, both with people running the networks themselves, the creative talent on the air are very important for a Media Company<\/a>. Predicting that dauman could be out of a job in as little as six months, with a ruling pending on a lawsuit challenging his removal from redstones trust. The battle over viacoms Strategic Direction<\/a> continues chst just last night viacoms p sall sallerno saying it is alarming. Now, in the spotlight is the future of paramount in particular. Advocating for selling a stake in the studio, that redstone opposes. One question that the industry watchers are asking is whether it makes sense to recombine viacom with cbs and whether it would make sense to have the ceo of cbs run the company. As the season opera unfolds, were joined in the exclusive interview with tom freston, launching mtv, and Comedy Central<\/a> and vh1. Good to get your perspective here. Theres the courtroom battle that is going on. All the elements, frankly, of a reality tv show, which ironically mtv helped to pioneer. What do you make of the situation of the decline the company has been in . The whole season opera of the redstone versus all these lawsuits has really been a side show compared to the real story, which has been the fall of viacom from grace over the last several years. That have been really one of the leading Television Networking<\/a> companies in the business. And now its fallen to a level below any of its peers on any metric plagued by all kinds of problems, including creative departure that you ran the story on. Its a company where jon stewart and Stephen Colbert<\/a> left within months of each other which has everyone scratching their head. Who is to blame . How did viacom get here . Get here from from the grace period when you were there. I think that, you know, ive got to say ive been gone for a while. A lot of my passion for the company has left. So im not really an insider. But you really have to be from another planet not to know some things. I think viacom got quite a bit more corporate. The culture that had been at the company, that had been so vibrant and profited was worn down gradually over time. I mean, litigation became a key tool at the top of that list would be a lawsuit that viacom launched famously against youtube for a billion dollars. A billion dollars, it turned heads everywhere in the Digital World<\/a>, at a time when viacoms competitors were learning. It froze viacom for years on the sidelines, unable to really make any digital moves. They suffered hugely in terms of their reputation. And at the end of the day, it was a total joke because they didnt get a nickel out of this. And probably spend tens and tens of millions of dollars over the folly for several years. You point out a lot of things that happened under dauman. Is he to blame . I dont think hes been the optimal leader for the company, no, i dont. Should he be fired . Well, thats really not for me to say. I do think that is he the right guy for the job right now . I would say no. I would say the right guy for a job like that, with young audiences, the person who holds that chair should be somebody who is turned on, attracted to, and somewhat knowledgeable about the creative community. And the Popular Culture<\/a> and whats going on there. And able to be able to telegraph that and inspire the employees of the Company Behind<\/a> that vision. You cant run an Entertainment Company<\/a> through lawsuits, through litigation. Top down, in that business, particularly in that company, its sort of a bottom up. Thats where ideas come from. And i think it requires more management than theyve had in the past. Some have described him an arrogant elitist. Would you agree with those words . Totally. Totally . Yes. Has a reputation of not being a great listener. How much interaction have you had, and some people who might be in daumans corner would say that he actually inherited a number of problems from you. Well, thats probably true. Anybody who steps into a job, theres always problems to pass on. And im sure i created a few that he had to deal with, yes. What is his number one misstep in your view . You mentioned the departure of talent. Theres also a Paramount Pictures<\/a> letting go Steven Spielberg<\/a> and david guess. What is the number one thing . I think besides being a real visionary that a company can rally behind, the idea that they move from the center of the Popular Culture<\/a> to the sidelines. They spent 18 billion, that is a ton of money, on stock buybacks in a period of time the whole world was changing, and they could have bought any number of things like time warner, disney, and nbc. But they use all that money to sort of prop up the stock price. Which was a trend when you look through what happened there. Selling their libraries off to netflix. Its not just dauman that has been there. Sumner redstone is on the board, runs, essentially, the company above dauman. There is the board as well. What role do they play . Is it really is it dauman . No, i think the boards complicit in the inactivity of viacom. And approving various things that probably havent advanced the company in a proper way. I dont know that the board is a board thats really in touch that the viacom viewers live in. The whole move to digital is where people go increasingly. Theyve been very, very paralyzed. Theres no one that board who is really a digital person, for example. So in terms of dauman, what his future should be, how do you think he got into this position where he could stay in the position if what you say is true in terms of his missteps . Do you see a future for him . Thats at the heart of the season opera right now. Sure. I dont really know. For me, when the redstones dont want you, when wall street doesnt seem to want you, and from what you can hear, theres not a huge amount of support for him in the company, youve got to wonder whats the game hes playing. Whats the point. You talked to sherri redstone. Whats her take on this . Shes not a fan. She fully understands what has happened, what has transpired. She has been really the lone voice of dissent on that board. Is there any sort of relationship beyond just being friends in that in speaking with sherri . Is there any sort of quid pro quo, there may be a board seat for you . She doesnt even know im on tv. Ive never done this before. I talk to her occasionally. Ive talked to her over the years, shes always very friendly to me. She has a lot of friends within the company still. But i dont really have any ongoing backandforth with sherri. But im really rooting for her in this battle. Why are you speaking out now . Its been a long time since youve been at viacom. Why now . It just seems theres a lot of people speaking out. I just am speaking my feelings. I worked for the company for 25 years. Its a shame to see something fall from grace in such a way. Hang on, our exclusive interview with tom freston will continue in just a few moments. Well find out if hes been asked to resume his role as head of the media giant. Stay tuned. Mary buys a little lamb. One of millions of orders on this companys servers. Accessible by thousands of suppliers and employees globally. But with Cyber Threats<\/a> on the rise, marys data could be under attack. With the help of at t, and security that senses and mitigates Cyber Threats<\/a>, their Critical Data<\/a> is safer than ever. Giving them the agility to be open secure. Because no one knows like at t. Approaching medicare eligibility . You may think you can put off checking out your Medicare Options<\/a> until youre sixtyfive, but now is a good time to get the ball rolling. Keep in mind, medicare only covers about eighty percent of part b medical costs. The rest is up to you. Thats where aarp Medicare Supplement<\/a> insurance plans insured by Unitedhealthcare Insurance Company<\/a> come in. Like all standardized Medicare Supplement<\/a> insurance plans, they could help pay some of what medicare doesnt, saving you in outofpocket medical costs. Youve learned that taking informed steps along the way really makes a difference later. Thats what it means to go long\u2122. Call now and request this free decision guide. Its full of information on medicare and the range of aarp Medicare Supplement<\/a> plans to choose from based on your needs and budget. All plans like these let you choose any doctor or hospital that accepts medicare patients, and there are no network restrictions. Unitedhealthcare Insurance Company<\/a> has over thirty Years Experience<\/a> and the commitment to roll along with you, keeping you on course. So call now and discover how an aarp Medicare Supplement<\/a> plan could go long\u2122 for you. These are the only Medicare Supplement<\/a> insurance plans endorsed by aarp, an Organization Serving<\/a> the needs of people 50 and over for generations. Plus, nine out of ten plan members surveyed say they would recommend their plan to a friend. Remember, medicare doesnt cover everything. The rest is up to you. Call now, request your free decision guide and start gathering the information you need to help you keep rolling with confidence. Go long\u2122. Welcome back to fast mon money. Tom, thanks for sticking with us. We ended the last segment talking about your conversation with sherri redstone. Im sure a lot of people wonder if you would take the job as ceo of viacom if asked. No. Absolutely no . No, listen, ive sort of moved on in my life. And things are good. Its hard to go back again. Despite the affection i have for the place, i think they can find somebody else that can do that job with a little more passion than i could at this point in time. Have you been asked . Has sherri floated that idea . Floated the idea to be ceo of viacom . No. Absolutely not . You just want to see the best for the company. At this point can viacom be fixed in your view . Sure. How . Well, theres a lot of good people still there. Im looking at it right now, right across the street. I think for them to fix it, they need to have a change of administration. I think top management really needs to go. Number one dauman is out . Is that number one . Duman and some of the Management Group<\/a> around him. And to install somebody who could be a good inspirational leader who understands business. Who on the team . Would it be a cleaning of the house sort of purge . You know, i havent been that close. But i would imagine that theres some folks there that you know, they kind of came in as a team, they can go out as a team, assuming that happens. Then the board needs to be repopulated. So you bring the age down. Get people from the Digital World<\/a>, other people from other forms of the entertainment business, people who have some kind of connections to the Popular Culture<\/a> who could really add something, understands the business a bit more. And i think its going to be difficult for them to just organically grow out of this. Theyre going to need to make some acquisitions or do more strategic partnerships, plenty of which would be available to them. Nickelodeon, mtv, Comedy Central<\/a>, theyre all good brands. By no means have they reached the point of no return. America loves a second act. You mentioned acquisitions. When you were there, you actually talked to facebook at a time when they were not public. What was the offer that you gave them . We made an offer to facebook in 2005, this is a joke right now, for 750 million, with an earnout, if you can believe it, to mark zuckerberg. At that point in time their revenue was about 25 million. They turned us down. They turned down later yahoo was in for 10 billion. Microsoft was in for more than that. Its now worth 300 some odd billion dollars. Lets not question Mark Zuckerbergs<\/a> decision powers. Is that the kind of acquisition you would like to see viacom make in terms of that space, that direction . Well, it would be lovely if viacom would love to, if they could afford facebook. Maybe they could figure out some closer arrangement with them. Being more deeply involved in the various fears of digital, with the social networks, an important place for them to go. Im sure they could find people on the other side who would be interested. Tom, first of all, thank you for joining us. As someone who was born in the mtv culture, i think it changed all of our lives. What is the next creative angle for you . We know vice is a big part of that. But what would you say is going to be the defining way to reach young people in the media world in the next ten years . Or five years even . Well, one thing i work on, were excited about, you mentioned vice. I did a deal with them when i was at viacom, which they bought out after i had left. But vice basically ripped off the viacom mistv Networks Rule<\/a> book. But in the digital age for the millennial generation. Its a big brand, vice, with a lot of little brands under it, fashion, food, music, so on, so forth. They have the same type of attitude about creating their own product, owning it, putting on all the platforms. Theyre on tv, digital, mobile. They have several revenue streams. Big worldwide footprint. Theyre just really getting going. They have a great deal with Home Box Office<\/a> that you may know about. Starting in the fall, were going to be launching a daily news show on Home Box Office<\/a>. Which is really their first foray into that type of thing. A new network called viceland was launched. Its sort of under construction. Its making headway. Theyre a smart and able group of folks who run it. Thats something to me that has high appeal. Its sort of a mirror of what used to do at viacom in a way. Under the umbrella of acquisitions, tom, would a studio like lions gate be among the targets that you would say viacom should look at . Thats really hard for me to say. All right. A fit . You know, there would certainly be a fit with some parts of viacom with lions gate. But thats better than Something Else<\/a> is really at this at the level that im at, the distance im at its hard to tell. We just got a statement from viacom. I would like to read this. Its a bit long. Viacom is significantly bigger, more global and generates far more profits today than when daumans pre deceaser left office in 2006. Viacom is making more global hits than ever before, such as lip sync battle airing in 96 countries. Philippe has brought in leadership to reposition key networks. The company has generated billions of dollars from emerging digital platforms while at the same time more than doubling affiliate revenues since 2006. Whats your take . Well, the pie has grown for everybody, but theyve fallen down from being the second most viewed Television Company<\/a> to the seventh. Theyve fallen down in terms of their ad sales growth, in terms of their ratings. The entire Television Business<\/a> has expanded. As for certain shows set in certain countries, i dont know. They have a good worldwide network. But its hard to think of any great shows, any big hits that have come about in the past bunch of years. They pointed out lip sync battle. Is that the kind of show that you would think a Media Company<\/a> would point out to exemplify what their success has been . Lip sync battle is not spongebob, lets say that. But it may be very successful. It sounds like its fun. I havent seen it, so forgive me. At this point, what do you think the company can do . What would you like the board to do at this point . Well, i dont know what the board can do at this point. Theyre locked in this battle with the redstones. Theyre suing. And its back and forth. So it seems like both sides are paralyzed. I would just say that i think it would be in the interest of everyone, especially the employees there, to have this over and done with one way or the other. And not be sitting in limbo. Because every day theyre in limbo, theyre losing more and more ability. Tom, we talked about what they can acquire. I look at this media property as 17 billion market cap. Pretty good Balance Sheet<\/a> here. A lot of problems on the board. Youre talking about lip sync battle, thats something that should be on another platform that somebody like facebook owns. If youve seen it, ive seen it. Thats the stuff that goes viral. To me, this looks like a company that 1. 3 times sales, disney at 2. 8, it seems like this would be something scooped by a new Media Company<\/a>, and just used as a linear tv platform with content. Scoop up viacom . Yeah. Its entirely possible they could be an acquisition target. Remember, natural amusements owns 80 or 90 of the stock, theyre a controlling shareholder. Sumners never been one to want to sell anything. Hes been a buyer. Lord knows over time. Hard for me to say. But no, theres its a great company. And it has you know, it has stumbled. But it certainly has the ability to rebound and it certainly has the ability to merge, combine, strategically, or on any other type of basis with other firms. Okay. Hold on there. Were going to take a quick break. Much more fast money right after this. The final word from the former viacom ceo tom freston, here with us in an exclusive interview. Tom, i want to get your take on the future of the company. There have been a lot of people who floated the idea that cbs and viacom should merge. Could les be the ideal candidate to lead this combined company . Look, les is like the Perfect Entertainment<\/a> executive. Hes done a great job. Hes a great guy. Done a great job at cbs. And the company was once together, and worked pretty well. Whether they get together again now, its not for me to say. Les and the board there might have a lot of other things on their plate. Its really not for me to say. But that would be an interesting combination, an obvious one. We were talking about a period in which you think that theres a fall from grace which implies viacom was once a great Media Company<\/a>. Do you think it can retain that size . Or has the world changed around them to the point its got to reinvent itself . Well, its still a great company. I dont want to theyve had steps and falls. And there are ups and downs in life. They could be well timed for an up right now. But i think for them to become relevant again, they have to deeply engage in the Digital World<\/a> that they really have been a bystander to largely to date. Its going to be hard to imagine them being relevant particularly with the kids, teens, young adults. Tom, thanks so much for coming by. We appreciate your time. And your insight into the situation at viacom. Okay. Pleasure to be here. Up next, weve got the final trade. Stay tuned. Here at td ameritrade, they work hard. Wow, that was random. Random . No. Its 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<\/a> on any chart plus over 300 customizable studies to help you anticipate potential price movement. Theres no way to predict that. Td ameritrade. Time for the final trade. Love the casino stocks. Melco goes higher. Boggles, bugles, yes. Lions gate. Valuation interesting now. Bank stocks will have a tough, tough summer. Stay short. Gdx, gold miners. Giddyap, theyre going higher. Be back here tomorrow for more fast. Jim cramer starts ri now. My mission is simple to make you money. Im here to level the Playing Field<\/a> for all investors. Theres always a bull market somewhere. I promise to help you find it. Mad money starts now. Hey, im cramer. Welcome to mad money. Welcome to cramerica. Other people want to make friends. Im just trying to make you a little money. Its not just to entertain but educate and teach you so call me at 1800743cnbc. Or tweet me jimcramer. One big bad event down, one to go. 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