The Trade: Reflation
Some traders including Fast Money’s Jon Najarian believe the way to game the news is with the reflation trade. (The intentional reversal of deflation through monetary policy.)
According to that theory, with the Fed advocating a weaker dollar, investors could pour into commodities driving those prices higher.
And there are 3 stocks Najarian has on his radar.
“Institutions have been loading up on GoldcorpGold Fields and Silver Wheaton ,” he tells Dylan Ratigan on CNBC’s Closing Bell.
Najarian believes these stocks were too cheap when compared to the spot prices of the underlying commodities; gold and silver.
“This part of the ride is the fun part,” he concludes. “I think the trend higher in commodities continues for a meaningful amount of time.”
More Stocks To Watch
Najarian also tells the traders he’s got Terra Industries and Agrium on his radar for the same reasons mentioned above.
Tim Seymour sees the trade a little differently. He thinks the commodities play is bullish crude. “I’m a buyer of oil , as well as emerging markets commodities companies Sasol Petrobras and PetroChina”, he says.
Najarian adds that he’s also bullish on the S&P. “We could easily push up another 80 to 100 points, he adds. “There aren’t a lot of people willing to stand in front of the momentum.”
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Trader disclosure: On Dec. 16th, 2008, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Macke Owns (MSFT), (DIS), (MCD); Adami Owns (AGU), (BTU), (C), (GS), (INTC), (MSFT), (NUE); Finerman's Firm Owns (MSFT), (PM), (MO); Finerman's Firm Is Short (IYR), (IJR), (MDY), (SPY), (IWM), (USO); Seymour Owns (AAPL), (BAC), (EEM), (F), (GE), (INTC), (MER), (SSL); Seygem Asset Management Owns (CHL)
Jon Najarian Owns (SLW) And (SLW) Calls
Jon Najarian Owns (GG) And (GG) Calls
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