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No.1 - Greenspan Ruins Party

It's been more than a year since Alan Greenspan was head of the Fed., but his comments still move markets. And he did just that today. Greenspan warned during a conference in Madrid that there is going to be a dramatic contraction in the Chinese stock market at some point.

The fear of an Asian selloff then proceeded to take down our market. Should we heed the warning of the 81 year old Greenspan and get out of stocks linked to the Chinese expansion?

CNBC Senior Economics Reporter Steve Linesman joins the guys to help answer that question.

Steve says he’s confused by the comments. For 7 years since the NASDAQ bubble, Greenspan said he could not predict an asset bubble and now, all of a sudden he’s getting paid and he can make this prediction. Steve can't understand it!

Eric Bolling can explain it. He says Greenspan is a speaker now – not an economist. Then Eric reveals that early in the week he shorted the iShares FTSE/Xinhua China 25 Index (FXI) because he was looking for a correction. Eric thinks China is overbought right now – however Eric makes it clear he believes it will go higher in the long run. (It’s worth noting Eric was ahead of Greenspan.)

Jeff Macke says Greenspan’s comment has no time frame and Jeff won’t trade it.

Guy Adami adds if the market was truly vulnerable right now, Greenspan’s comments would have taken the market down 200 – 250 points.

Dylan Ratigan reminds the panel that China puts are expensive and it’s possible to bet in the right direction and still lose money.

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Trader disclosure: On May 23, 2007, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders: Najarian Owns (JPM), (BIIB), (FITB), (OVTI); Bolling Owns (DIS) Gold, Silver, Coffee, Sugar; Bolling Is Short (FXI); CNBC Is A Service Of NBC Universal And Dow Jones
Bolling Was Short (FXI) On 5/21/07