Will the economy will take a sharp turn for the better this summer?
All week long, we heard comments that suggested we may, in fact, turn a corner in the coming months.
First, we heard from the Federal Reserve -- Ben Bernanke and his colleagues appear moderately bullish. In published minutes they said the likely driver of a summer turnaround will be business sales and factory production, which should gradually recover – largely due to the Obama stimulus package and the Fed's aggressive rate cuts.
And later in the week, the president of the Federal Reserve Bank of Boston struck a similar tone.
Eric Rosengren said he believes the aggressive monetary and fiscal responses to the crisis, which included slashing the benchmark federal funds rate to near zero and putting in place a vast array of emergency lending programs, had helped "provide the foundation for an economic recovery."
Then on Friday MKM Partners economist Mike Darda told Fast Money leading indicators signal the bottom is near. “I think the recession ends this summer and we'll start to see positive growth as soon as Q3. I think 2010 surprises to the upside.”
As a result he thinks stocks could really run. “The market is starting to price this is in. It could be substantially higher in 6 to 12 months.”
What’s the trade?
Ahead of the broadcast Darda told our producers, “buy into weakness in the markets. Look at basic materials, industrials, and emerging markets.”
And you can see that Darda puts his money where his mouth is. He also told our producers he owns the SPY, the HYG -- and he's playing emerging markets with a long position in the EEM and the EWZ .
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Trader disclosure: On May 22nd, 2009, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Seymour Owns (AAPL), (BBT), (EEM), (FLR), (TTM), (INFY); Seymour is Short (FCX); Terranova Owns (ABI), (JOYG), (XBI), (TER); Terranova Owns (DIS) Call Spreads; Terranova Owns Oil Futures; Terranova Owns Nat Gas Futures; Terranova Owns (DIS) Calls; Terranova Owns June Gold Futures; Grasso Owns (AMZN), (RIMM), (V); Grasso's Clients Own (AMZN), (PG), (X), (MA), (VA), (ALL), (AMP), (JPM), (WFC), (SUN), (PBR), (POT), (MOS), (MSFT), (IBM), (XLE); Najarian Owns (ISIS), (BCSI); Najarian Owns (APC) Call Spread; Najarian Owns (AMD) Calls; Najarian Owns (BX) Calls; Najarian Owns (INTC) Calls; Najarian Owns (PALM) Call Spread; Najarian Owns (MOS) Call Spread; Najarian Owns (XHB) Call Spread; Najarian Owns (XLB) Call Spread; Najarian Owns (XLU) Call Spread
Michael Darda Owns (SPY): Mike Darda Owns (HYG); Mike Darda Owns (EEM); Mike Darda Owns (EWZ)