Game plan for 2016. But first, so long, santa claus. Only three days left in 2015. Guess what, folks, there is no santa claus rally in site. I can see a whole lot red with the major averages lower today. As oil is dropping again. The dow now poised for its first negative year since 2008. Pete, kick it all off. Did you expect 2015 to be so volatile, number one . And number two, kind of lackluster once the score is in. When you look at where the markets been, its been very much in a tight range. Weve talked about this rotation, which has occurred for what seems like the entire year. When you look at last week, it basically encapsulated what weve seen throughout the year. Which is we started bat eed at 2020. Here we are in the 1700s. Thats the kind of year were in now. I think well see a lot of that as we try to get to all the different numbers and interpretations of whats going on global. How many times did the s p go over that breakeven line . Dr. Jay what do you think for 2016 . I dont think were going to see quite the same effect of either currencies, the exchange that everybody was talking about in the First Quarter and how much it hurt earnings. Because we wont see another 25 move out of the dollar in particular. I dont think well have oil, for instance, one of the most heavily traded commodities. As soon as prices got back into the 50s, production came back on. Of course, dominic chu, who quotes those numbers every week for us, was telling us how they were dropping, dropping, dropping, which is great as far as production, but then the oversupply came right back on. Were not going to see that again this year. I think it will take us a long time to get back into the 50s. It was only a few weeks ago, it was on the fast money 5 00 p. M. Show. I was saying i wonder if the hike will be the news for the dollar. The dollar has not done anything spectacular, has it, since that hike. It just sat there, really. The euro was all the way down to 105 on the dollar. When he made the move, the euro shot all the way back. Yeah, youre right, were not doing a lot to either currency here. Maybe take away a head wind to corporate america. I think i agree with you, gentlemen. We know that started, right, in august 24th. I think next year is going to be look at earnings. People will say, whats going to happen . Is the s p going to be where it is . Or if Oil Stabilizes and gets back up, i think thats a positive for the market. Because down here, too Many Companies are scared to invest. When you have that, that has the Ripple Effect of nobody putting any money in the market. The only Thing Holding this up is the consumer. As soon as you know, the consumers good. I think theyre going to be good for the next 18 months. Were going to be talking about whether or not the consumer is dead or alive later on in the show. You think the consumer is going to keep on holding this economy higher. I do. With oil staying where it is, is probably now look at it as more of a permanent tax as a shortterm tax or hike. So i think thats better. And steve . Im a little more optimistic. I dont think the markets going to run away here. To me, the s p at 17 times, yeah it sounds expensive, particularly since you have corporate margins peaking. All time highs. This year, i think, will be the peak, because youll see labor costs increasing. That p thats good for the economy. Thats good for the economy. I look at it as a relative investment. Where am i going to go . Im not going to go into credit. With every reserve currency, china sold about 15 of their treasuries. The first time in a very long time. Youll see saudi arabia continue to sell. So we may see a spike in rates, which means bond prices will be going down. Where i really want to be is with hedge funds. Were seeing, i mentioned this a couple weeks ago, and were still seeing it, well see it to a greater extent, winners and losers. The rising tide is now do you have the goods or not as a company. So im seeing great returns on the short side. So hedge funds traditionally have underperformed, have outperformed, rather, except in this totally liquid environment over the last five years. Youre going to see it go back to normal. Lets move on to the top business story of the year. This is at least according to the associated press. Weve mentioned it a few times. The chinese slowdowns. The president of the euro asia joins us now on the phone. Thank you very much for your time today. Its interesting the way that the china slowdown was certainly the theme of the year. I was taking a look at the tally for the shanghai market, up about 9 . Do you think next year is going to bring continued slowdown or is the bottom starting to be in . I think the big story around the Chinese Market of course was both the extraordinary overreaction by the Chinese Government to the hit that it took in the middle of the year. And also how much it freaked out anyone outside of china thats actually watching it. People thought it was in free fall while the Chinese Government said, hey, we dont have a market, were getting the ability to intervene. I think youll see the same sort of thing in 2016. Whats so interesting about china is the ability of the government to actually intervene, to prevent significant shifts that could cause instability vastly greater than that of any other major economy in the world. And, you know, significance, further slowdown in china is not just about jobs. Its about the well being and the stability of the Chinese Communist party and the leadership. So if they need to spend some of their 3. 5 trillion in reserves to ensure that they may sorry, were having a little bit of technical difficulty. Keep on going and see if we can get you back there, ian. Steve, you got a question . So chinas done some easing but the easing potentially you could argue has hurt them. Theyve lowered rates. The worst thing you want with the bank, with some of the Balance Sheets they have, is to earn less money. So when will they come in with enough stimulus to really get the economy going, their version of q e, rather than doing things on the edge, lowering the reserve ratio, which, by the way, i dont know if thats helping at all. You have so many under water, potential bow rorrowers, whos g to do the borrowing . When you look at the Chinese Government team, with the exception of the reaction to the shanghai market crash, this is a government that has shown itself to be extremely comfortable with both the level of growth and how much theyve taken off of inf infrastructure as well as the gradual increase in market consumption. So much of the slowdown has effectively been not just allowed by the government, but it has been facilitated. Theyre the ones that are doing the corruption, theyre the ones taking money out of the Stateowned Enterprises that, you know, were able to spend with reckless abandon over the past 35 years. So the answer to your question is about the Comfort Level of the chinese officials. And so far i see that as being pretty high. I dont see a change here in early 2016. Certainly the problems of the chinese economy have been well chronicled. All the other bric economies have had their problems as well with the exception of india, right . You call it the last bric standing. Its big. The fact that you actually have no corruption in the Leadership Today is astonishing. The fact that mohdis party, it is actually run by him, you know, the parties themselves have been inefficient over the past decades. And they are trying to create much more stimulus for the markets. Things that anyone tried to invest in india ten years ago would have said this is never going to work. Growing into that, you also have a younger indian population. Who just feel very differently about the demands they have of their government, as well as their own desire to work, their ambitions. I think the average indian, the country just changes in china or in the united states. Swreering that effect too. Certainly mohdis keyed into that youth issue you were talking about. Uses a lot of social media, doesnt he . We have to leave it there, ian. Great conversation. Thank you very much for your time. Mohdi has an over 70 approval rating. Theres a lot of leaders around the world that would love this. Whats your feeling on where the market can go . I think he briefly mentioned it, but one of the biggest i think tail winds that mohdi had is energy. India is one of the biggest importers of energy. The lower and middle class are so dependent on the subsization of energy. Right now, the average consumers benefiting not from what hes done. Thats taking way larger so hes in the right play at the right time . Exactly. The other fact that scares me, its a oneman show. You cant really say theres no graph going on in india right now. That seeps through government. It takes a long time to change. I think thats one of the things that scares me. A lot, if you look at indias stock market, its done well over the past couple of years. Its a show me story. I would wait for pullback here to get back into india. Very good comments. Its got a long runway, too. Over 170 Million People live i think on over just 1 a day which puts it into perspective. Coming up, who won the holiday wars. Plus, one strategist who says dont buy the doom and gloom out there. The consumer will save 2016. And 1,000 could be the magic number for alphabet next year. Welcome back. The Holiday Shopping season is officially over, folks. Lets head out to courtney reagan. Who knows a thing or two about retail. The main retail etf, the spdr we follow, is down on the session about. 75 or so. Still underperforming the Broader Market. Fairly Light Trading because it is between christmas and new years. Dicks Sporting Good store shares down. Barnes noble down. It is definite something we should note. In the accessory spashce, we ar seeing some movement. Kate spade and fossil are down. Francescas, thats up on the session. So is signet jewelers, up 2. 5 . Fit bit is among the Top Performing retailrelated names. Its app, the second most downloaded from the app store. Fit bit charge, also one of amazons top ordered items, at least under its prime same day shipping so we know some folks got some fit bits in their stockings. Its a new years resolution play. Next year im going to finally get pit. My body is a temple and all that kind of thing. Did you buy fit bit today or you tried to buy fit bit . I tried, i couldnt get it, missed it by six cents. I did get it, mandy, as far as trading it online myself. I bought it. The stock popped up over 30. The only reason is if you had one of these. Its a fabulous device. Keeps you from being as sedentary. Youre moving more. I like that. From a fitness stand point and from Oprah Winfrey getting involved in weight watchers, youve got a lot of folks focused on fitness in 2016. I actually almost bought one. Said, i dont need artificial mechanisms i do. Naturally motivated. In any event, at best buy, it was the most crowded counter. Fit bit seems to be the one that everybody goes after. I think they can report a very good christmas. So to me people just arent going to use the app. Its one of those things you think about, you use it for a few days, say, why am i doing this, whats it matter. There are things that make you use it. Like the sleeping part. Being able to set an alarm on here that wakes you up at a certain time or gets you to do something at certain times. I think it keeps you involved with it much more than some of these other fitness apps do. Maybe it should give you electronic shock if you dont get out of bed. Thats good motivation. Consumer discretionary is the best performing sector this year. Our next guest says dont fight this trade. He is the president and ceo of farr miller in washington. I understand you think, you know, the consumer is alive and well, but im wondering whether the difference is they might still be spending but its how theyre spending it. No question, mandy. Wonderful to be with you. The consumers fine. The consumers limping along. Not running along. I would like to see the consumer maybe start seeing them wear a fit bit, see a little more activity out of them. Well see everybody make some money, john make some money on the stocks he bought. I hope. I do too, look, john, im with you, pal. I think that i read over the weekend, its so negative. People are waiting for the crash. Theyre waiting for the market to come apart. When you have this many people paying attention to all the things that can go wrong, historically they really dont go wrong. I think the consumer is doing is more employed, it making more money. While its not fabulous, it isnt bad. So mr. Farr, how are you . Question for you. Im with you on this one. I think one of the things thats overshadowed now im worried. I know, you and i together on the same page. Consumer discretionary is basically amazon. The fear there is everything is getting amazoned. How do you look at that . Our view is i think the pie grows. I just wanted to hear what you think. I think not only does the pie grow, i think the pie is shifting. I think the consumers taste and the way they want to buy. My neighbor ralph cusic looked at me. Ralph is 80. He looked at me as i was going to the store the other day and said what are you doing . I said, im going to the store for paper towels. He said, i just ordered paper towels off amazon. If you have an 80yearold ordering off amazon prime, were seeing a real change in behavior here. I do think you have to figure out how to capitalize on it. My problem is i really want a company thats actually earning money. Michael, you brought three stock picks. Obviously one of them is not amazon. The first one youve got on your list is not a retailer. Its Goldman Sachs. Im giving it three stocks. Its kind of hit them where they aint stocks. They didnt do particularly well in 2015. Goldman is an Investment Bank in sheeps clothing. Its a commercial bank. 1. 1 times tangible book. So this is cheaper than goldmans, i mean than a wells fargo for instance at 13 times earnings and 1. 6 times book. Theyve got a 1. 5 dividend. These guys know how to make money. People dont like goldman, but dont bet against them. Just for the same of our viewers who may not know, i myself had to look them you were p up because theyre kind of under the radar. Provide infrastructure and services for things like traffic light systems, Irrigation Systems. You name it, they do it, right . They do. I got this one wrong in 25. Or i got it early. All of the talk about a new infrastructure spend, Shovel Ready Projects going back a few years ago. These guys make the pylons for towers for phone lines or electric lines. They make light poles. They make a bunch of stuff for intrafracture. And for water efficient Irrigation Systems and recycling. The stocks cheap. It was down 14 over the year. Its growing earnings we think Going Forward at 12 . Its got a 1. 5 dividend. I think you might have to be patient but it sure is cheap. The last one on the list is patterson companies. A distributor serving the dental, veterinarian rethha bil rehabilitation markets. People who probably spend more on their pets than their kids in some circumstances. You think about the consumer getting a little bit better. We saw people not go to the dentist and people not spend as much on their pets. Theres money coming back here. Its 16. 5 times earnings. Its a very simple blocking and tackling company. 12 , 13 earnings growth, with a 2 dividend. Its very well managed. Its got a solid balance sheet. So these are three companies that didnt have a great year, but i think they make some sense Going Forward. Okay, good to talk to you, sir. Im not sure about belmont because i dont regard it as cheap. 17 times for a Company Going at 12 thats also highly cyclical sort of gives me the you know, im not so sure thats cheap. In terms of patterson, i like it. But dental care is getting more expensive and insurance is covering less and less. Now, insurance never was a big dental payer. So i like that one. And, you know, i like the first one. Whats not to like about Goldman Sachs quite frankly. Hes talking about where it trades in terms of the p es. Maybe Goldman Sachs if they could actually increase that dividend further would maybe attract people to more of them. At 180 a share, almost feels like a steal. The last two months, its been going further and further south. Maybe that selling pressure comes often as we get into january. Oil hovering near 11year lows as excess supply still weighs on prices. Is a recovery anywhere in sight . Plus, the doctor is in. Investor sam eisley gives us his Health Care Outlook for 2016. Talking of which, valaent under pressure as the ceo takes medical leave. I take prilosec otc each morning for my frequent heartburn because you cant beat zero heartburn ahhh the sweet taste of victory prilosec otc. One pill each morning. 24 hours. Zero heartburn. Shares of Freeport Mcmoran are falling today after announcing their executive chairman will step down. This just months after investor activist carl icahn took a stake in the company. This stock unfortunately its been under pressure for a long time. I think its because they leveraged themselves near the high when you look at the oil prices. That dash for trash kind of move. Oil moved up a little bit. So did freeport. Copper moved up on the stabilization of china. It was trading very low 6s. Got 7 1 2 range. Now we see the pressure again. Theres been huge, i mean monstrous, active put buying consistently in this game ever since august. It really started in august. Now theyve actually roll noodle february. If you look at some of the open interests. The seven strikes, six strikes, five strikes. Across the board, theres been a negative look at this company in terms of the stock itself. Now, will it be able to survive . Will the bonds . Im not so sure. It was in august they announced theyre slashing their 2016 very large. Workforce by about 10 . 10 , yes. Jim bob