Betting On A Comeback

Despite the threat of a slowdown, at least one major investor appears bullish on casinos and hotels. On Tuesday Kirk Kerkorian revealed plans to focus his portfolio on gaming and energy companies.

The billionaire investor, who is already the largest shareholder of MGM stock said in a prepared statement “in light of current economic and market conditions, (I) see unique value in the gaming and hospitality and oil and gas industries and, therefore, have decided to reallocate resources and to focus on those industries.”

It’s a classic definition of optimism, counsels Guy Adami. But, personally I would not buy the casinos based on Kerkorian.

Absolutely not, exclaims Jeff Macke. The casinos are going to turn at the same time as the consumer and that’s not now! He's way too early on the gaming stocks.

I think MGM is cheap, counters Pete Najarian and I own some. Plus, I got almost $3 for the November calls which brings the price down. (In other words he owns MGM and is short MGM calls.)

What do you think? Tell us now!

On the flip side of that coin is Kerkorian’s decision to get out of Ford. Specifically, he’s sold 7.3 million of his shares in Ford Motor Co. and plans to further cut what is now a 6.1 percent stake, for a potential loss of more than half a billion dollars on the investment.

You might remember that Kerkorian has a mixed track record with the other U.S. automakers. He made an unsuccessful $4.5 billion cash offer for Chrysler last year and pushed for General Motors to form an alliance with Nissan Motor Co. and Renault SA in 2006 after acquiring nearly 10 percent of GM.

High gas prices, a slumping overall economy, low consumer confidence and the tightening of credit markets have taken their toll on the automaker and the industry overall in the months since.

Considering Kerkorian had been so closely associated with the auto industry what does Tuesday’s move really mean?

“I believe this is Kerkorian saying Ford is dead money. (That he thinks) Ford isn’t coming back anytime soon,” explains CNBC’s Phil Lebeau.

I never really understood what he saw in Ford anyway, adds Pete Najarian.

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Trader disclosure: On Oct. 21, 2008, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Adami Owns (AGU), (BTU), (C ), (GS), (INTC), (MSFT), (NUE); Macke Owns (UUP), (MCO), (MSFT), (SDS), (BNI); Finerman Owns (GS): Finerman’s Firm Owns (MSFT); Finerman’s Firm Owns (DNA) Call Spreads; Finerman’s Firm Owns (OIH) Puts; Finerman’s Firm Is Short (IYR), (IJR), (IWM), (MDY), (SPY), (COF), (BBT), (USO): Najarian Owns (EMC), (BNI): Najarian Owns (AAPL) And Is Short (AAPL) Calls; Najarian Owns (AXP) Put Spread; Najarian Owns (FCX) And Is Short (FCX) Calls; Najarian Owns (MS) And Is Short (MS) Calls; Najarian Owns (RF) And Is Short (RF) Calls; Najarian Owns (MSFT) And Is Short (MSFT) Puts; Najarian Owns (CAL) And Is Short (CAL) Calls; Najarian Owns (MGM) And Is Short (MGM) Calls; Najarian Owns (BNI) And Is Short (BNI) Calls