Disappointed tech, which has been the best performing sector of the year remains the epicenter for much of the selling the vix is up, theres so much to discuss i couldnt think of a better day to have you. Welcome back. Nice to see you i know people think of you as this energy guru and oil trader, but what is your broad view on where we are theres so much going on today alone to discuss where do you see the markets right now . Simply at some point when if the ecb pulls back, japan pulls back and all these countries pull back from printing money and the fed has made it obvious what theyre doing, theres going to come a time where the markets just may not go down that much but theyre not going to go up what happens when we enter a period of time when the markets stagnate two to three years where the overall performance is flat . What happens then to all the Pension Funds and municipalities that have all these on ligations that rely on 7 . You cant tell me over the next ten years theres not going to be two to three years where the overall at least is going to be flat how does everyone make yield the opposite side of the coin is if you asked anyone today could you start your Business Today like you did 20 years ago, the answer would be no, right . So thats why the markets have thats why the multiples are so great because its impossible to start a new business i dont care what it is. So on the one hand you have the fact that companies are so much valuable because its impossible to start a business. On the other hand what will happen when everything goes flat it spins around in my head 24 hours a day. Youre a sports guy, if we were to say, okay, what ining are we in this stock market rally weve witnessed, what would your answer be i would have dead wrong about three times and a stopped cloing is right twice a day so i would say eventh, eighth could we go to extra innings maybe, but the point being is you dont need the market to go down just what happens when we go nowhere . Does everyone expect the market to make 7 , 8 , 9 every year for the next 30 years . You raise the issue which i think is sort of impacting part of the market today and thats what the Central Banks around the world are doing when they pull away from the system, these rates that are rising globally pushing rates higher around the world, german tenyear today highest level since january of 2016 rates here are moving up on a day where they could easily move lower because the data was disappointing from the jobs perspective with adp and claims. And, judge, what weve seen from the beginning of the year through the beginning of june you saw a lot of the Interest Rate plays, utilities in particular, up big, i mean, everything from nee to excel to dominion, all of these stocks were up anywhere from 5 to as much as 20 in the First Six Months since then theyre all diving and i mean diving in a hur voy that accelerated when the fed made the latest move now these stocks are among the weakest out there. You think the faangs are having a hard time . Look at the turn these stocks have taken it is the faangs that dominate the conversation where the rollover and this rotation has come from and into the other depressed areas which are off the loyest level of the day. You cant have it both ways not you. But if youre colloquially speaking, if youre in the group screaming the market is being dominated by five momentum stocks and blah blah blah, fine. Now you have a 10 pullback in google, you have facebook 5. 5 off the high, you have the whole run of these names have pulled back are you still complaining . Have you moved on to Something Else now you have people screaming what they want then you have sectors that lookal riglook unt phenomenonal right now look at csx, this chart is flawless i dont want to you can a about it its so pristine. Look at whats going on with this, ksu which i bought last week, another rail the Airlines Look amazing so it doesnt have to be all faang all the time were using that acronym as a short hand to describe what is classic growth momentum uptrend. And because the tech sector decides to sit out it doesnt mean the Bigger Picture is negative this doesnt end on old age, weve heard that before. The market was on the defensive. Nvidia turned it around, you saw that, so the market gathered momentum with the turn around in nvidia, but overall it comes down to what is the path and trajectory here for Central Bank Policy the services ism was better than expect which had lifted the tenyear treasury, highest level in two months. If we could get a continuation of that and a breakout of 260, then theres justification for the earnings were seeing right now and seeing in the economy some momentum there as well. I agree with marcs point. I dont know necessarily that the market goes down, it might just go sideways but it looks like the pause that will refresh when you get energy, when you get financials, technology coming back. Can we just point out that the market was flat for 23 months we had zero progress in the s p between the midpoint of 2014 at the onset of the oil crash up until really right after brexit, markets started to go again. Its almost two full years of nothing for the s p, small caps did way worse, International Stocks got killed. So this idea that were just going up and up and up and up year after year is not true. So lets switch the conversation to what is your wheel house and thats crude up nine over the last ten days. Its had this nice run coming off of yesterdays the last couple days disaster trade, where is crude going from here are you trying to pick a bottom . No. I would think its simple, the range is set, low 40s youre a buyer as long as the specs dont get too long high 40s, low 50s specs are long you have to get out. Unless something dynamically changes the equation like god forbid something in north korea, theres your range and when it ends up happening, its happened four or five times already and people get bulled up when it gets into the 50s and depressed when it goes to the 40s. As long as the commitment of traders keeps washing every time, you buy it every time it gets to the high 40s. How long could this last . This could go on for years, right . How long can something last i have no idea it could last for a long time. Theres no way of predicting fundamentally im not going to tell the story about why were trapped here, oil producer selling that comes in, but the point being i still think in Energy Natural gas has the potential for the most upside just because of whats going on internationally just because of coal switching internet gas because of how much theres got to be some weather, the reason why natural gas has been depressed for so long is the weather has been too mild. One regular winter and the price is going to take off. How is oil up nine of the last ten days with north korea at the top of the headlines. The market doesnt seem to be reacting to anything. The market doesnt react until it wants to react so you can say it used to be how is crude oil up nine out of ten days with the euro down or un . I think its all uncorrelated. People just chase things one way and another way. In crude oil, whats happened before is when people pick bottoms, it keeps going down i think in the last couple youve seen the last four or five days is that on this rally no one is getting long which means it can probably go another four or five but the minute you see it pulled up again youll see the commitment of traders numbers its time to get out again unless something fundamentally changes the picture, were just the street is trying to get their handle on it some people are trying to call a bottom, you have an upgrade in schlumberger i dont know what you think of about that you have a number of downgrades in weatherford, transocean, noble then they maintain their holdings in other stocks how would you maintain this space . To me i would just go ahead and be looking at the because i definitely think the next winter or two were going to have a rig winter and that gas is going to break out of this range at 275. I think at some point its going to trade with a four or five handle on it and surprise a lot of people. When that does, which ever company survives, whether it be chesapeake i dont know if chesapeake survives or not, big cap Natural Gas Companies you get paid to wait some of these stocks are so cheap they became options. Like what kind of names. I hate doing that i hate i leave that to mini, mo and curley. [ laughter ] we love when you do that, thats the problem. Judge, when you look at these events going on, we talk about it all the time on the desk. If you look for instance in the volatility space people have been betting against volatility all year long, not just in marks space, the ovx, the volatility of crude. But if you look at the vix itself, or the etn vxx, that began the year at 24, slammed down to nearly Single Digits and now has a big spike. You look at the short interest, short interests are people that bet that continues look at those bets, they are saying that vxx is not going to be going any higher than where it got to today thats the kindling out there that gets the fire roaring because normally people that buy volatility hedges are doing just that hedging. So all the shorts that have bet against vxx will spike even higher. I heard you mention before Central Banks low rate policy. When you look at shale production right now, a lot of the production and growth in production was built on the back of low Central Bank Policy what happens when rate rises to the production and the shale producers . Joe, honestly, thats above my pay grade, im not sure what happens. If anyone tells you what will happen interestingly enough, im looking at my phone, ive gotten seven Text Messages from four people that control billions of dollars, three of them yelling at me, one telling me im wrong good market. The one thing i can tell you is i think people overthink things when things go up and you dont know why, theyre going up much higher when things start going down and you dont know why, theyre going down more. So right now with everything going on in the world and the markets held in pretty good, how can that possibly be everyone knows what Central Banks are doing, right so oops. Theres another one. So the point being is i just think that, you know, trading good news, bad action, we talk about bad news good action, thats probably the best way to go for the next year or two. Things that look good that dont make any sense if everything made sense, everybody who had a 95 average in high school would be a multimillionaire. Right . It doesnt work that way. What i hear you saying though in the way you dissect whats happening in energy is that oilrelated plays are a notouch oil. I would think that i didnt say oilrelated plays are a notouch i just think that nat gas plays are a better touch i dont want to go ahead listen, you know what part of the oil patch would be interesting to you. Here we go again. Im getting pigeon holed again, right . Listen, you know me better than that, come on. Am i going to tell, like, my nephew if he wants to buy exxonmobil not to buy exxonmobil of course not. Its the point being is i think whats happened ing is the Energy Stocks that can survive 40 or 50 an oil, they will be fine it seems like the whole market is right for mna, how do you combine . You dont combine, get rid of all the fat, you can see that. But the you think dividends are in jeopardy no, i dont think so. I know there was a whole thing about it, i was reading about how exxon was paying out more no, i think those dividends are safe for a long time as long as oil stays in that range, 40 to 50, yes and people have cut back enough to make their dividends be sustainable. Thats what i think. Out of curiosity, so youre pushing the energy out, how about Something Like the pipelines. You want to push . Why would i go to the supermarket . But most of the pipelines are not energy theyre transportation companies, right but is that a place to be in the energy space to be in that transportations part of it moving one area to another. Yes, as long as theyre not leveraged enough, thats all about how many Financial Leverage they have, right . People make the misnomer that most of these pipelines have 10 to 15 exposure to the price, right . But how much leverage do they have on them and Everything Else the game with these pipelines has been you buy an mlp, put it a, what keep getting returns on capital, never sell the stock, have a basis of next to nothing wait until you pass away, get a stepped up basis and its a party. But most people in the in the midstream space keep thinking oh, my god, if crew goes down 35, this company theyll stop moving. Thats not the way it works. Theyre not raising dividends anymore when that happens and they were price wise extraordinarily sensitive to the price of crude at this last go round. They crashed the whole sector was down 70 and these were supposed to be bonds. So i dont know that the attitude toward that sector will be the same next time oil seems like its stabilizing higher i think people will just say you know what, if i have oil risk let me do what mark suggests and buy the producers. This is a buy, hold and pass on to people. I also think, josh, a lot of these companies yes, a lot of them crash, 40 50, , 60 but these levels, youre right because of the fear that theyre going to crash again, no one wants to buy them. Theres definitely a depressed multiple. Nobody wants to buy them. When people dont want to buy things, theyre on sales it makes sense when you want to buy them that way theyre trading not when theyre doing so great. When theyre up on hype and they dont have the earnings to back them up. Let me try it this way. Oh, boy. Let me try it this way. Here we go again. Would you be more apt to be long the commodity itself of natural gas or would you say a that here in is the export which youre bullish on is the right place to be . Believe it or not, we still try to time natural gas which has been a how should i say this a not effective strategy over the last 12 months [ laughter ] but for the general for the general person listening to this, youre much better off in the equity than trying to turn in back end cal 17, that gas but for those who feel that they have some knowledge of the markets or think they did maybe they dont anymore, theres still opportunity to trade the futures markets for shuch. Theres going to be i think there will be volatility in nat gas and pow eer and people are afraid of it for the reasons josh just said, people have gotten burned so many times. The next big rally, i hope nobody goes long saying im not getting sucked in, until they do get sucked in, then its time to give it to them, right im not giving him what he wants. I cant. He gives you a little more leeway than us, though. Eog. Im not here to joe, you know more about eog than i do. Right . Right . Again, im not here to again, i can just tell you that i dont think theres much risk. So if you like natural gas so much, exxon makes the acquisition of xto years back. Good acquisition because it hasnt been good timing i think that was a good acquisition but just terrible timing you waited two years, how does that look then they waited two years to do it. So in another five years, is that a good acquisition . From where we are today yes. To segue away from that, mark does sort of make a good point for us to have that next leg of the debate and thats the endless struggle to for some anyway to think about when value may come back over growth and if energy is the ultimate place to try and pick value in this current market, where do you think thats going to come back or not if jim was sitting here, hed tell you he thinks value is back others would say value is coming back people would say look at energy, thats a good place to find value in the market. Try to pick bottoms. Is it a head fake or not. Are you going to get burned to use fishs word . Hes checking out whos texting him. So many people are yelling at me on this phone that im like i need a new number. But josh, why are you laughing at me its true. Because youre the only one of us thats actually if i pulled out in front of scott if i was checking my text because i know whats going to happen. I cant get away with that, you can get away with that. Are you on every week oh, yeah. Im only once every six months well take a quick break and have much more with the legendary mark fisher next on half time. Coming up, ge gets a price target cut but the stock is on mark fishers list, the essential 40 well debate it and talk about the other 39 stocks on fishers list but first, tech the big winner the first half of 2017 our daily partners at ken show showed tech is up on average 2. 57 in q3 after leading the market in the first half of the year bctomore ken show, go cn. Com pro clouds cant connect . Our michael, can we get this data to. . Look at me. Look at me. Look at me. You used to be the yes guy. What happened to that guy . Legacy technology can handcuff any company. But yes is here. So, youre saying we can cut delivery time . Yeah. With help from hpe, we can finally work the way we want to. With the right mix of hybrid it, everything computes. 52 week low. Jpmorgan cuts their price target the firm doesnt see future growth as a catalyst our call of the day. Josh, youre in it, youre out of it now. They say the empire resets they cut estimates and lower the target they go to 22 bucks. I sold it right after the barons bounce and the ceo thing. I just look at this like the chart is a picasso its all over the place. Theres nothing going on here. You really dont have any trend for years and years. It looked like it was on the verge of a breakout over 32. That fell apart. And there are too many stocks right now that are in up trends that are just doing incredible things so i just looked at it like i dont have time for the six months or a year that its going to take for them to figure out what they want to do with this company ill get back in the next time it challenges that level. Are there an awful lot of people ive got the time i was in the stock. Less time than me. I had a great run for a while. Ive been out of it for a year or more. I was waiting for this i like jeff ammel, terrific gentleman. In terms of running the company, unfortunately a lot of bad luck. How about when ge decides to get into the energy space at 100 plus oil that was a huge mistake obviously now in retrospect, but a lot of those decisions they made getting out of the finance, all of that, collapsing the stock. So i think that you needed fresh blood, somebody new in charge,