And he just bought more today. Hes going to give us the name and, chances are, you might own it too and black rocks terry sims son said the trump trade is on, quote, life support. So what does that mean for the rally . But first, we start with what seems to be the magic words for this market, tax cuts. Every time someone from the Trump Administration utters those words and recommits themselves to be the agenda, the market takes off after paul ryan said the party is unified on tax reform during a town hall last night the dow having its best day since april. Soaring nearly 200 points. As the markets soar, the volatility index sank. The question is tonight, do you continue to buy stocks on hopes of tax reform and how much higher can this market go . Guy great to have you on board. Maybe what everybody was thinking about in the past. Whats the question were going to attempt to answer my answer would be yes weve been pretty steadfast in that belief. Brian kelly about a week ago at the height of the uncertainty the market was facing said this uncertainty probably helps President Trump push this tax reform regulation reform through. His theory being this is a man in dire need of a win. Im not certain its going to happen but that appears to be whats going on. Ill say this, weve been pretty adamant about this as well we said 24. 10 in the s p has to hold we said the dax needs to hold 12,000 look where it traded down to look at the bounce there if youre a technician which i dont fashion myself to be but if you are one, this market did everything it needed to be on the downside it feels like the next leg higher is upon us. Growing talk, the markets timed for a correction, markets tired, market needs to reset market could go down 5 , could go down 10 . All it takes is two words, tax cuts, thats all in the past . Last week was a volatile week on knowledmany sides at the end of the day, investors got a little turned around here. I think todays reality, really light volume i dont think there was much other than wish tasking. A lot of this tax reform talk. At the end of the day, i dont believe whatever guy just quoted about b. Q. Lak. L. A. Weekast we think there will be meaningful tax reform. Even though the fundamental storys in place, you dont like well, fundamental story, i think the markets fine, okay if thats what your thing is. I dont think theres a lot built in for tax reform. I think there may be some anticipation about tax cuts or some sort of repatriation. The market today essentially told you even pattern all of a sudden you say that, well, it depends what you get. Go back to 04, look at repatriation a few hundred Million Dollars were brought back. Much of it went to shareholders. Which is bullish but if youre looking for a tax cut or amnesty because you think its going to instill growth, you know what microsoft did, they actually paid a 32 billion special dividend in 2004 and initiated their first buyback ever of 30 billion. Thats what a lot of other companies did. I suspect them to do that too if they get that in 2017. I do not expect any tax reform in 2017. I dont think that this thing gets through the reconciliation process it doesnt get through this narrow majority the republicans have just like health care. The fundamental underpins of the rally are still intact, are they not economy grow, ratings low, earnings good. Yes. You know, Regulatory Environment thats improved. I do think today was a combination of last night being a relatively uneventful evening for the president. So that is a big uptick from prior events and then i also think some tax reform i do think, though, that the scale of it is getting smaller and smaller as the administration feels like we need a win almost at any price, you know doesnt even matter right. Does the size even matter to your point on the repatriation, i dont think they care whether the money is used for growth or they can just fill the coffers with an enormous, however much, 2 million, 3 million, of repatriated money, thats a win for them, theyll take it. Pete, where are we . Where are we now weve had these couple of days. Yesterday the narrative was the market was on pace for its worst month of the year. Today, a 200point rally for the do and tax cuts. And trump agenda which was allegedly d. O. A. For 2017. Right, and just the talk about that, and weve heard steve mnuchin, he talked about august being the time well see this obviously, that gets pushed out. The facts and fundamental story continues. The volatility these swings, its amazing we get up to 16, we pull right back we were down 7. 5 on the volatility index yesterday down 14 today volatility comes out extremely fast in this situation there has been vol ooum. Maybe not as much today. You look over last couple of call it five, six trading day, multiple days where we traded over 1 million contracts in the delive tents world so were seeing growth there bets today, it was in semi, technology, financials across the board, a lot of different strengths. Its much more broad than i think it was painted a lot of the day. Today, up 1 . Last week, we only had our second 1 down day of the year i think a pickup on volatility on both sides is not exactly bullish when were only 2 from the a the alltime high. A whole bunch of wish casting. These guys need to sound enth e enthusiast enthusiastic they moved the goal post on numerous occasions. Maybe thats enough maybe moving those is just enough you can see what the market did today. Not in 2017 or 2018, because then you have a very unpopular president , okay, we have a Midterm Election year and they have nothing to point to with the super majority in the house and the senate and in the white house. So to me but youre blaming it all back to just political your whole thesis right now thats what we talked about. I dont know that we are. I think we talked about the potential for some of these tax cuts and then the actual story of whats got growth and what doesnt. Lets see how the budget thing goes next month, okay. Theres a lot of stuff that has to happen here for this thing to stay intact. What do you think the markets going to do if we have a shutdown in the government weve seen that before it may not be as bad as it was in 2011. Just like brexit, everybody panicked the panic pushed that market down were up 100 since the last government shutdown. 100 , okay so were at a situation here so the people who have been bearish have missed 100 rallies . No ones missed it. Really . Now, thats unrealistic, i would say. Really . Okay so fangs had a nice rebound today. Played maybe the largest role in taking us to where we were a reboot for the fangs has to be positive for the overall market, no the question is, does it last . We talked about it last night. You were not hosting last night. It was one brian sullivan, large marngs goodlooking, like yourself but one of the stocks we mentioned at the top of the show was google, now called alphabet. We said specifically alphabet traded down to a level it had previously held about a month and a half or so ago 920 being that level we talked about it on valuation being still in my opinion, i think karen and petes as well, maybe dan, still relatively inexpensive. Yes, i think theyll be a rebound there. Out of all of them, netflix continues to be my favorite. How about the big bounce in some of the other names we dont talk about as much Something Like boeing today leading this market, up 4 there are so many massive moves that are outside of fang, outside of all the names boeing is the king of the dow. The absolute king even a recent rally out of home depot that was getting pushed, pushed push eed pushed, the amat and everything else. The housing trade is not dead. Its interesting, the New York Times has a story up right now that says the relationship this goes into our conversation about the how realistic tax reform, tax cuts or any sort of tax policy is the relationship between President Trump and Mitch Mcconnell has disintegrated according to the New York Times to the point that theyre not even on speaking terms does that speak to the current political environment being difficult to the point where its going to be hard to get things done even as politico and their story today said they were making progress would set the market off in a fast fire . The idea of progress go ahead. Well, no, weve seen him pick people in his administration and have twitter wars with them and then it fades, theyre no longer the target i would think that mcconnell will not be the target a week from now point is, Jeff Sessions judge you need the Senate Majority leader i think you do. He went after that he went after that, after him in a very meanspirited way for weeks. Then Jeff Sessions all of a sudden has this press conference and then he gets on, reengages and gets on board. I think the staple thing could happen with Mitch Mcconnell. Very different with a cabinet member and a guy who has a conference that is so divided. Thats the Biggest Issue you have a Republican Senate that cannot agree. All the issues that killed health care are the things that are going to kill tax reform because you have this group on the right that needed to be deficit neutral. You have this moderate group in the republicans. You know, who are going to really cant handle the stuff that makes it deficit neutral before an election year. I dont think its a great analogy, guys, sorry, about sessions twice tonight youve got i think ryan and mcconnell are beleaguered. Hes a little bit feisty, boy. Dont you think its easier to go back to constituents with a tax cut then i take away your insurance no. Really . Lets look at this article. Wrap it up. What theyre talking about, guys, is theyre talking about taxing 401k investments. Theyre talking about capping your mortgage deduction. Theyre talking about things that are not exactly cohesive with a middle class tax cut for all intents and purposes to me it goes back to getting a tax break for these super wealthy people who fly on those fancy planes with their tom ford and all that other crap. To me, theyve been sold a bill of goods, this thing is not going to happen. Our next guest says tax reform is key but hes not betting on it any time soon. Terry simpson is the multia set strategist at black Rock Investment you listened to the conversation just sort of lend your voice to this debate as to how the market needs this to keep going higher. Yes, its interesting obviously, it would be a nice bonus. I think we step back and look at the fundamentals thats kind of whats really been driving the market. When we think about the tax reform, the calculus is just so difficult. We talk a lot about basically the political fighting and the rhetoric down in washington. But the reality is, no one has talked about it, showed a plan how theyre going to raise revenue to fund this tax cut everyone loves s a tax cut. But its difficult to think about how you actually fund it. How much does the market need it so i mean, we made the case that the fundamentals are good enough that the cake is already good,c cake today, the market suggests in order to have the next catalyst to take the leg higher, you need something concrete to come out from that side two word, tax cuts set the dow off running today. Yes, we know were about 8 1 2 years in the bull market were basically trying to think about how do we propel ourselves Going Forward, how do we keep that stimulus. What we think about in this tax reform is about trying to shift the potential gdp of the United States economy now, u. S. Gdp is only about one and a quarter. It makes it easier for businesses to cooperate across the United States and do business than across the globe that can be actually very beneficial we could see higher gdp Going Forward that could go back to the companies and have some upside there. Do you think the market needs to take a rest, the rally needs a rest or do you think its potentially worn down and run down to the point where it gets sick and needs some sort of correction to weed a bunch of things out i dont think we need a correction just to weed things out. I think the fundamentals are strong enough. I think what we wit ntdzed has basically been about geopolitical unrest. Obviously we have some elections coming i and the Biggest Issue is north korea when you think about geopolitical risk, its not enough to shock the markets, its about the extension of the geopolitical risk. If that persists for a long time, then we could see a pullback i would say were looking with the rally today 1. 5 off alltime highs thats not a correction people should be getting worried about. Where do you think you would want to be invested in the market so, we still have equities relative to fixed income we still like tech, financials and select parts of health care. We talked a little bit i heard you talking about repat tr repatriation if you expect that to happen, its going to benefit technology sectors, going to benefit big pharma as well thats where a majority of the money is sitting overseas, in those sectors. When we talk about whats priced in for tax reform, i would say those name, microsoft, google, apple, they have over a half a trillion dollars overseas you bring that back here, you know, and so what are they going to do . Make big acquisitions . Probably not they probably do what we expect. I bet you see facebook you dont start buying back their own shares this is what apple has bought 160 billion of their own shares back so theres a lot of stuff that theyre going to do that may not instill growth. Do you think those are onetime Events People have now learned from where you have the major dividend, rather than adding to the dividend my point is those five nasdaq names. Right. I think they are anticipating some form of tax reform whereas the rest of the market may be not. Built into it. When you know apple has 260 billion in cash, net 160 billion, that gives you confidence in the name you know what, you couldnt give it away when it was below 100 trading near ten times last year but now as we have tax reform on you know do you think its all tax reform, it has nothing to do with services and all the other aspects i think it has to do with a lot of things no, but you painted a picture just now why are those six stocks outperforming it so dramatically take a look at these various chip names those are up even greater than some of these fang names youre referring to and apple, microsoft, some of those names huge those have had massive moves but they dont get as much attention because the market caps arent quite as terry, last word. Coming back to the fundamental, probably some of the market is baking in tax reform we had double digit Earnings Growth last quarter. Its not just Financial Engineering on the bottom line we also had 8 sales growth. So also on the top line. You cant discount the fact that the fundamentals are very, very strong. Thanks for being here appreciate it. I dont know why we have your chair so low, sorry. I dont know either felt very low today. All right, coming up, the l. A. Times picking media veteran Ross Levenson to navigate the newspaper in the new age of journalism. I spoke to him earlier today were going to bring you his comments that had everyone talking today. Plus, snap making a bit of a comeback and starting to look a bit like another social giant. Facebook we have those details. And later, pete nagarian getting really for a very special fast pitch. Hell make the case for a stock that hes owned for more than 20 years. More fast money after this she cant become a guitar legend just by playing air guitar. The babys room wont build itself. And her paw wont heal on its own. Were all working forward to something. Synchrony financial can help your customers make it happen sooner. So she can plug into her dreams. And theyll have a new addition for their new addition. Whatever youre working forward to, even if its chasing squirrels, Synchrony Financial can help you get there. Thats why at comcast were evencontinuing to make4 7. Rels, our services more reliable than ever. Like technology that can update itself. An advanced fibernetwork infrustructure. New, more Reliable Equipment for your home. And a new culture built around customer service. It all adds up to our most Reliable Network ever. One that keeps you connected to what matters most. Welcome back to fast money. Newspaper giant tronc surging today after it named levenson to head the New York Times. Newspaper stocks have been on a tear since the election, even as President Trump has targeted a number of these names, calling them fake news and otherwise but mr. Levenson sees a Bright Future for the space he joined Halftime Report earlier today. In the entertainment world, it should be the bible, it should be the paper, and Media Company of record. I actually think we have to get away from the term newspaper. This is an incredible journalistic operation and its an incredible Media Company. And i think we have to, you know, put our focus on doing great work and getting it out in an aggressive manner all right, new publisher and ceo of the l. A. Times Ross Levenson there earlier what do you think, i mean, that stock was up 4. 5 i think during our interview. Probably rightly so it probably gets more of a multimedia feel than they currently have which is probably extraordinarily important. You mentioned it you sort of danced around it New York Times was, i believe, an 11 stock when President Trump was president elect trump back in november that stock recently traded north of 19 i mentioned that because all of these names have been on a roll. Now you ask, is valuation starting to get in the way given their growth, at least current growth, id say it i