Strategy Session with the Fast Money Traders
It’s history unfolding before our eyes, says Dylan Ratigan. AIG is essentially insuring $500 billion in credit but basically keeping nothing in collateral.
My emotional instinct is to be a buyer of stocks in the morning, says Joe Terranova. I’m hoping that all the pessimism is coming to a crescendo.
The market is trading on a lot of things other than fundamentals right now, muses Zach Karabell. If you look at the data, the rate of the real deterioration in the economy could be slowing.
For investors, it’s about staying alive for another day, counters Tim Seymour. I agree that fundamentals are interesting, but don’t be the first to dive in this pool.
I’d shorten up my swing and have a lot of cash in my portfolio, bristles Jeff Macke. Fundamentals in banks are deteriorating and that’s why the market is going lower. There are no super cheap stocks because we don’t know what the government is going to do.
I see a lot of cash on the sidelines, counters Joe Terranova. That will drive the market, at some point. We could see a vicious bear market rally.
OIL TUMBLES 10%
Oil prices dropped 10 percent to $40 a barrel on Monday as a deteriorating world economy threatened to cut further into fuel consumption, outweighing OPEC's strong compliance with supply curbs.
The deepening of the 14-month economic slump was underscored by a report showing spending on construction projects slumped to its lowest level in over fours years in January.
I would not be short oil, counsels Joe Terranova. Long term I think it climbs.
Economic data out of China this week should show two months of increased demand, counsels Tim Seymour. And they’re a buyer of commodities.
If you’re looking for signs of change, look to consumers, says Zach Karabell. Most people aren’t going to lose their jobs. When they’re no longer afraid and start spending again it should drive the economy.
TOPPING THE TAPE: THE DOLLAR
The dollar rose against most other currencies on Monday as the broad market sell-off triggered a flight to safety.
I think there are major troubles in Europe and Asia, explains Tim Seymour. As a result the dollar should get stronger from here.
This is bad for multi-nationals such as Hewlett Packard , McDonalds and Pepsi which do big business overseas, adds Jeff Macke. As they repatriate profits they bring in less dollars.
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Trader disclosure: On Mar. 2nd, 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), (EEM), (BAC), (FXI); Seymour's Firm Owns (FCX); Terranova Owns (DIS), (FXC), (XBI), (BRCM), (WYNN), (INTC), (DELL), (JOYG); Terranova Owns (AMGN) & (AMGN) Puts; Terranova Owns (IBM) Call Spread; Terranova Owns (COP) Calls; Terranova Owns MACI Oil Futures; Macke Owns (MS), (GS), (SDS), (TM), (AAPL), (WOS); Karabell Owns (AAPL), (FCX), (GOOG), (GLD), (GE), (JPM)
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