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Bernanke's Bail Out Lays An Egg

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BERNANKE'S BAILOUT LAYS AN EGG

The headline: S&P 500 Gives Up Most of 2% Gain as Fed's Cash Injection Plan Fails to Soothe Jittery Investors.

The Federal Reserve's credit crunch plan includes 4 “auctions” in which it will lend up to $40 billion to banks. Also the Fed will join with 4 other central banks to inject cash and thaw the global credit crisis, explains Dylan Ratigan.

> Read more:TAF Program: Need Money? Go To Them

Jeff Macke doesn’t like the way the Fed presented their plan. Why didn’t they do it on Tuesday at 2:15pm, he questions. Macke thinks the move makes the Fed look sloppy and reactive. He’s bearish.

Karen Finerman agrees.

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CANARY IN CREDIT COAL MINE

The headline: Bank Stocks First to Roll Over Wednesday as Investors Question Fed's Cash Injection.

Citigroup (C), Bank of America (BAC) gave up their gains Wednesday as investors bet the Fed plan won't revive subprime-saddled lending markets, says Guy Adami. Personally, I don’t think investors understand the Fed’s plan.

This market isn’t about the long-term says Pete Najarian. He put a short on Goldman Sachs (GS) Wednesday because the day’s market action “just didn’t seem right.”

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OIL SOARS 5% to $94:

The headline: Crude Oil Surges 4.9% To $94.39, Highest Closing Price Since November.

Goldman Sachs lifted its 2008 forecast for crude oil prices to $95 explains Dylan Ratigan.

Guy Adami thinks it’s just a rotation out of commodities and nothing to worry about.

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Read more:Strategic Investor Dennis Gartman Says Oil Goes To $100

AFTER HOURS ACTION:

The headline: Biogen Idec (BIIB) did not receive any definitive offers to buy company

Pete Najarian says evidently nobody is ready to spend $25 billion for Biogen.

No joy for me, adds Karen Finerman. I’m long options.

CAPTAINS OF INDUSTRY:

The headline: Industrial Conglomerate 3M (MMM) Jumps On 2008 Earnings, Revenue Forecast.

The industrial complex has looked pretty good to me since the summer, explains Guy Adami. He likes Honeywell (HON).

AFTER HOURS ACTION:

The headline: ADC Telecom (ADCT) Surges After Hours

Pete Najarian believes there’s a lot of growth ahead in wireless, hence the after hours action.

GE'S 2008 PROGNOSIS:

The headline: General Electric (GE) CEO Jeffrey Immelt Says He'll Be 'Disappointed' If Diagnostics Business Doesn't Double In 3-5 Years.

Guy Adami believes Laboratory Corp (LH) and Quest Diagnostics (DGX) are the trades because “they’re both stocks that could go” if GE is serious, he says.

SUN FRANCISCO:

The headline: San Francisco Offering Loans, Rebates To Encourage Solar-Panel Installations;

In energy, Guy Adami thinks the coal sector is in play.

NO FLOWERS FOR SALLIE:

The headline: Sallie Mae Plunges After Saying J.C. Flowers Will Not Make New Offer.

Karen Finerman says she’s not surprised by Flowers. However, Sallie Mae slashed profit forecasts for 4th quarter, she adds, and that’s not good.

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Trader disclosure: On Dec. 12, 2007, 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 (ATVI), (YHOO), (INTC); Najarian Owns (CSCO), (ADCT); Najarian Owns (GOOG) Options, (GS) Options, (TSO) Options, (YHOO) Options, (BIIB) Options; Finerman's Firm And Finerman Own (GS), (FTWR); Finerman's Firm Owns (VLO), (SUN), (YHOO), (TSO); Finerman's Firm Owns (MDY) Puts And Is Short (MDY); Finerman's Firm Is Short (SPY), (IJR), (IYR), (IWM), (MBI); Finerman's Firm Is Short (LEH) And Owns (LEH) Puts; Finerman's Firm Owns (BIIB) Options; Finerman's Firm Owns Russell 2000 Puts; Finerman's Firm Owns S&P 500 Puts; CNBC Is A Service Of NBC Universal And Dow Jones; GE Is The Parent Company Of CNBC; NBC Universal Is The Parent Company Of CNBC; Vivendi Owns 20% Of NBC Universal, The Parent Company Of CNBC