Fast Money

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Fast Money

Penny-Pinching Trade

On Thursday Supervalu announced $30 bonuses for shoppers who convert their fiscal-stimulus checks into gift cards. With consumers under siege what’s the best way to play a penny–pinching population?

The four horsemen of the apocalypse have come to America. We’re talking a housing bust, a credit crunch, skyrocketing food & fuel costs, and rising unemployment, explains Becky Quick who's in for Dylan Ratigan.

The consumer is under siege from all angles and consumers are hunkering down and preparing for hard times. That means buying only those things they need to survive. We’re talking milk, macaroni and M&M’s. (Well how bad can things be if we’re talking M&M’s!)

As a result shares of warehouse retailers such as Costco , BJ’s Wholesale , and Wal-Mart are booming on our belt-tightening. People buy in bulk not only for the quantity discount but because larger amounts mean less trips to the store and more gas in the tank!

Back to Basics

What are the best ways to play a penny-pinching population? I think you should buy Wal-Mart and Costco on any dip, counsels Jeff Macke. Not only do they work in a penny-pinching environment but they’re incredible merchants. I think both of these companies are in the right place at the right time.

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Trader disclosure: On Apr. 24, 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 (YHOO), (MSFT), (INTC); Pete Najarian Owns (AAPL), (NOK), (TSO), (XLF), (YHOO); Pete Najarian Owns (CHK) Calls, (DD) Calls, (MSFT) Calls, (POT) Calls; Finerman Owns (GS); Finerman's Firm And Finerman Own (HD); Finerman's Firm Owns (MSFT), (SUN), (TSO), (VLO), (WMT), (YHOO), (MO), (PM), (JCP); Finerman's Firm Is Short (IYR), (IJR), (MDY), (IWM), (SPY), (COF); Charles Schwab Is A Sponsor Of "Fast Money"