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tv   Fast Money  CNBC  April 6, 2021 5:00pm-6:00pm EDT

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carnival ceo about when we can get cruise in again and new cdc recommendations, a lot to discuss after stocks took a bit of a pause what are you watching? >> just exactly that, market action market slowed volume-wise, volatility-wise. boring could be bullish. see if it holds up. >> thanks. "fast money" begins now. >> i'm melissa lee this is "fast money" trader lion guy adami, tim seymour, karen fineman and tonight's sounding to
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declare a cease-fire and the very next day
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thursday earlier than everybody else knew. >> so what is your sense as to why credit sweets left out of the party. we're just learning that they're going to they were liquidating the rest of the exposure just last night this is weeks later. >> it is hard to explain other than an outsider like me saying that it is perhaps a sign of dysfunction, of the left hand not knowing what the right hand was doing in the case of credit suisse, of not having a culture in which risk management is elevated to a high enough position where they could act quickly and decisively to bring it back to the morgan
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stanley, the way we heard about it essentially is that when they shifted a lot of the risk to the hedge funds, the hedge funds were not thrilled because they didn't know the extent of the selling that was just about to happen the very next day, that tens of billion dollars of share sales that were going to happen the very next day. so word got out ultimately. >> so it seems like the u.s. banks at least largely dodged this so call bullet. does that remove the regulatory target on their backs? if it were morgan stanley taking a multi-billion dollar hit could this be a whole different story when it comes to the banking system once again being the target of new regulations? >> i think so. melissa, i think the answer is morgan stanley was looking at a hit of as much as $10 billion if they did nothing and sort of were more of the critics in the camp of sitting on hands until the losses develop and everybody
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else got out of the trades if you look at morgan stanley, you could say this about goldman sachs and jp morgan, if you have the biggest most robust in the world they have the most sophisticated risk management systems and they are the most battle tested and been through the 2008 crisis which is only 11 years ago and perhaps they are responsible at least when it comes to protecting their own balance sheet against these type of blowups. >> hugh, thanks. grate reporter cnbc.com guy, i'll go to you first, how does that make you feel that morgan stanley could have loss $10 billion. is it make you feel oh, my gosh i can't believe that could have been the hit to morgan stanley >> so the answer is yes to both.
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good for morgan stanley. good for goldman sachs they have risk management in place. people at very high levels at these banks, something that we talked about value at risk, every single day those numbers were looked at at goldman sachs and morgan stanley and i'm sure they look at today and i'm going to get mad at a lot of people and there is a reason it is called second tier banks and it is playing out right before your very eyes and $4.7 billion loss and the world has changed a loss and that was the aggregate loss that element took the banking system down in the day. and bill wang, and i don't think i'm speaking out of turn, he pled guilty nine years ago and they paid fines between $45 and $60 million and here we are back in business, it speaks volumes as the amount of liquidity and people keep going back to the well that is a the bigger problem and
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i'm sure sheila could speak on that. >> let's bring her in now. sheila bear is former fdic chair and now director of the culver alliance >> thanks for having me. >> so does this say to you that the u.s. banking system is terrific in risk management, it is terrific in terms of the cap cal that they have stored up or does it tell you that we have a problem. >> it says we have a problem there was a lot of risk building up in the system, a lot of exposure maybe they dodged the bullet but there are people on the other side of some of the sales that did not dodge the bullet they have good risk management suggests that they didn't to let this happen to begin with and maybe they were acting more quickly with better information in terms of dodging the bullet, whether they acted cally, i don't know whether they acted legally. i think there is a lot more questions about how they handled this situation but the fact that they even came
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this close, i think suggests that their risk management leaves a lot to be desired i will say, in fairness, though, that market conditions and -- if this is everlasting zero interest rate policy it is an indication that leverage is building up in the system, capital costs virtually nothing and they could make money over the private offices and hedge funds as capital light activity and so they're building the bombs even when the bombs go off, they are hurt they're still helping to build the bombs and is that really appropriate for regulated holding company, banking organizations, is that appropriate, is that safe and sound behavior and i'm hoping this triggers some supervisory review, but also, you know, the market conditions are there, the fed needs to step up and tighten supervision, knowing that the monetary policies is creating incentives for exactly this kind of behavior.
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>> sheila, it is karen, thanks so much for coming on the show we love hearing what your thoughts are >> thank you. >> so here is my question. i think it is possible that the banks didn't fully understand the risk they had because there wasn't adequate disclosure by archeggos and shouldn't will be regulation they didn't realize that we got $5 million of viacom, or whatever it is how would you address that. >> i'm skeptical about whether they didn't really know that archeg os was building this position and let's give them the benefit of the doubt and say they didn't know, they should have known, there should have been disclosure around this where disclosure requirements have not kept pace with the synthetic positions that could have market moving impact in one market participant but because it is a synthetic position as opposed to
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owning the security with voting power, the disclosure rules just don't kick in. this is a problem for a long time it absolutely underscores it needs to be fixed not just so the prime brokers know, but investors generally know there are particular market participants for building up the huge concentrated positions of particular stocks. >> hey, shielda, it is tim, thank you for your insight tonight and i want to get to your point around the feds role in all of this banks report in a week and a half next week we're talking about the numbers. a primary issue is capital return, how aggressive on buybacks and dividends what is the fed's role here and should investors be concerned about the fed maybe being a little bit more difficult than a june 30 green light. >> well i hope that they will at least the supervisors, they may not do more regulation, i hope they do, i think there are areas
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they could improve but from a supervisor perspective there is much more scrutiny in their relationship with hedge funds. so i think bank investors can and should expect that whether it will hit returns, i don't know what extent they might tighten the supervisor we've seen large financial institutions, banks in the safety net that have affiliates with deposit insurance and they have been pulling back on main street landing and they've been tightening standards for main street for loans, loans are capital intensive and the returns are not so great right now. so they've been pulling back in favor of this capital activity which is frankly riskier and i think maybe there is a silver lining on this, is that they are getting the fingers singes
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catering to these clients when they are pulling back on main street the fed and all of the bank regulators need to look at the incentives being created by the sfrur and the failure to tighten margin requirements on high risk through this transaction, and in whether we are expecting enough of our banks and main street lending when the country needs them especially when they're doing buybacks and dividends and those have started up again. that is a longer answer to your question but in short-term, i think there is tightening up and i think that is a good thing but long-term, is this ow banks are in the safety net, do you what you want, do as many stupid things as you want, but if you have this kind of federal safety net support i think there are obligations that go with this and when they are pulling back on main street is something regulators and policymakers should be thinking about >> yeah, it is interesting, and you said we started the show by
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saying maybe goldman or morgan stanley dodged a bullet, maybe the system dodged a bullet but i think you would agree that other situations out there, we're just not aware of it. and my question to you and i have preface this of saying i'm no fab of our federal reserve, i think it is important to say that otherwise the question seems different. how much -- how much of the brunt of the responsibility, 12 years of zero interest rate policy have to do with the behavior that we're seeing here? >> i think banks should be held accountable for their actions. you're this big, you're this systemic, you need strong risk management and you need to deal with the risk presented by the market that you operate in that said, yeah, it is created a lot more challenges to manage risk again, whether capital and the incentives to lever up are so strong and make so much money doing exactly the kind of transactions that goldman sachs and morgan stanley were doing, these are the incentives that
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have create and i do think if the fed is going to continue these policies, and they are for the foreseeable future, tighten up the ricks and just increasing margin requirements, make it more expensive through margin to borrow would help. but i'm not sure the fed is thinking in their terms but i hope they do start thinking in those terms. >> along those lines, i want to follow up on a metaphor you used they help build the bombs and they didn't hurt anybody but they still help to build them that implies at some point the bombs will hurt somebody is that somebody that -- is that the system >> i think there were people that own stock, you know, viacom and others, they're sure pressed so it wasn't like there was no systemic consequence but there were people who were, you know, collateral damage in all of this but i do think, as i said earlier, this kind of business that they're doing, this is not
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a one-off. i think they're doing a lot of this kind of business with hedge funds and these private offices that are essentially hedge funds. so, yeah, i think it could been we could see more of this. whether it happens in tandem, i don't know the lack of transparency makes it hard to assess what the risks are. but prioritizing, i would increase margin requirements and tighten supervision and absolutely fix this loophole we have in our s.e.c. disclosure rules where it you build up a concentrated position through a derivative, you don't have to report everybody needs to know that and so those are things that are short-term fixes that i think could help a lot but yeah, i think the system is at risk and the sad truth is we don't know because there is no transparency around this kind of business. >> sheila bear, thank you. dan nathan, it sounds like if half of the things sheila said werin acted for the banks that is not great for business.
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>> well, listen, you could ask, is this the sort of business that the banks want to be doing and if there was more disclosures they won't do that business to this extent. we've been asking this question for last couple of weeks what sort of activity could be systemic and obviously it seems isolated to this situation she also used a really interesting term, whether the way that morgan or gold man acted were ethical, i don't know if she was speaking to those but they ran ahead of with of some of their counterparts once they had news and credit suisse brought that to the fore, and not only did they run ahead, but they also plugged their clients. if you look where it closed on march 25th it closed at 204 and then the next day it traded as low as 174 and that means the hedge funds got plugged on that 25th
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this is not just about printing tickets because that is what the guys who lost money is focused on, but it is about trust with your clients and i suspect they may have have done some damage on that front. last thing i'll say is that if you look at credit suisse disclosure for q1. they say they're going to lose a billion dollars in the quarter and they lost 4.7 on this trade, that tells you there is good things going on in the banking system right now where they are profitable and they could absorb those type of hits on a quarterly basis. >> maybe that is a takeaway. everything was fantastic for the business until green sill and this, oh, yeah, green sill also happened to credit suisse within weeks of arch egg os imploding how do you think of the relationship of the banks and the regulatory environment on the back of this >> well, just to go back to your first question, we asked guy, are you proud of morgan stanley or upset they were in this, yes
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to both, right and i think also dan made some great points about, would you, how profitable must they have been to be able to weather this gigantic hit as well as they did and only be down whatever, 900 and whatever it is so i think we're going to see some great bank earnings although the stocks have already poved. i also think it takes time to do regulation of the sort that might need to be done here to prevent this and without the u.s. banks having really been sort of seared by this, i don't know how much -- i know elizabeth warren is upset about it, but i don't know how much it will take to enact any of those potential regulations, but i also think sheila's point about the s.e.c. needing to work on the disclosure issues is really important as well. because she made the point not just the disclosure for the banks but disclosure for shareholders they enjoyed the ride up in viacom i didn't
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i left way to early. maybe that leaves me bitter, i don't know but i think it is important to know who has what and that is important for the banks to know because i can't imagine they knew the full extent of the exposure that they had now some of that is on them. and then the last thing, i'm wondering if the people who they stuffed the trades to, where all of the this backfires and this is a little bit of pay back. i don't know could be all of that said, i'm long banks going into next week when they start reporting. >> coming up, elon musk and kathy wood chitchatting on twitter, where else. what the two said that got us talking. those details next but first snapping higher, the social media stock and will atvestors get ghosted. th trade more when "fast money" returns mfortable homes. emerson's energy star™ certified sensi™ smart thermostat uses geofencing to simplify
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so how do i do this? you don't do this. we do this, together. bounce forward, with comcast business. welcome back to "fast money. check out shares of snap jumping more than 5% after an upgrade of atlanta equities, saying snap transformed from a metric center app resulted in more time spent
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on the service atlantic up to $175 a share. i believe it is $175 that is more than 30% higher from current levels. tim, what did you make of this call >> i think it is a good call it is a company that has had a big run although it pulled back in some of the higher multiple tech sectors pull back and i think you definitely at 14 or 15 times 22 revenues, the multiple is really tough. having said all that, this is a unique platform. they seem to have the best add growth in online media they seem to be more shielded from the regulatory risk based upon the nature of the platform. if you look at their monetization per dau's, they're significantly lessen trenched than facebook which means they are one-tenth of the traction which means they have a lot of room to go so i think there is a lot of good news around this story. i think there is a lot of good news priced into it. i wouldn't chase it tomorrow but snap is here to stay for sure. >> i made the error. it is $75, of course
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otherwise that would be quite a price target a key part of the call to tim's point, guy, is the notion that arpu had historically been lower but the analyst believes now there is a better chance of narrowing that gap between it and in terms of average revenue per user and its competitors >> yeah, agree with that by the way. and i think ever core raised their price target as well i think they report on april 27th if you remember, snap was being left for dead for a lot of people and it coincided that facebook ran into problems with advertisers and that gave them the opportunity to get off the mat and it has been a monster every since. and i think we did a power pitch and it was a teenager. and the stock was pulled back from 17 1/2 and pulled back to 50 bucks so i think you could
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oeb this stock at the end of the month. >> i'll quickly go to dan since steve pitched it >> hi, mel >> hi, dan. >> well here is the thing. you mentioned a couple of thinks that i thought were irptsing you talked about the regulatory overhang that the large competitors have, they don't have that. 85 million market cap. today we saw clubhouse valued at $4 billion i want to see these guys, if you said this upgrade is predicated on going from a messaging to a content creation place, they have to get in the game in some of these things and they have to look how to go up the food chain as it relates to demographics and clubhouse would have been a great way to do that, we know that obviously twitter is coming up as a competitor to clubhouse with spaces. audio seems like the place to be and i'm surprised snap is not moving, a., with the stock and b., with the balance sheet, and c., understanding to get in arpu
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and to compete to facebook it seems like they need more products. >> we have for ahead on "fast money. here is what is coming up next. >> tesla's elon musk and kathy wood getting into a tweetstorm what are these two major market influencers chirping about those details next plus coin base giving ooirns one last peek at earnings before going public next week we'll have those nbeumrs and a lot more when "fast money" returns. ♪ ♪ old ideas, that's it. calling anyone with grit change this, change that, but don't ever quit yesterday's thinking is done from a challenge we never run
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back and forth about valuations, it all started when elon musk asked what you think about the market cap to gdp and wood replies that it involved during the industrial age and do not seem to be keeping up to the digital age, thanks to productivity and it is inflation lower than reported sulgsing that the quality of earnings has increased significantly. in 1990s ratio of total s&p market cap to gdp was .4 and then hit before it pulled back now at about 1.6 karen you dipped your toe into this tweetstorm. what is your take on this? >> my take on it is that it is a red herring. it is -- there are so many reasons why it is not relevant for one thing, gdp doesn't reflect a change in the value of assets, right, only a change -- only so if the value of all houses goes up, it is not
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reflected in gdp it doesn't reflect s&p earnings some of which are global over this denominator of u.s. gdp and the last thing, 20, 30 years ago we did not have private equity present -- any private equity presence remotely close to what we now have. i think we have probably $6 trillion or more in private equity, these are companies that many of which were public. that are no longer so you take that out, and i think it is just -- it is just sort of muddying the water is the s&p expensive now compared to what it was? yes, i think so. i don't think you need the denominator of the gdp to muck up the picture yes, it is expensive i know guy totally agrees but i think it is a red herring. >> i would think that he would be on the same page as you, karen, only because -- because this is also known as a warren buffett indicator. this is something that one of the greatest investors who has
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ever lived uses on a regular basis, guy and for that reason i would have thought that you would have said this is bunk >> no, but i think karen -- to karen's point it is outdated as well i happen to think elon musk went to a day of law school because when he tweeted that question, he knew the answer he would get 00% and there is something self-serving about that and it plays to the narrative he's been talking about for a while. i'm with karen on this clearly the market doesn't care. it is out dated. maybe in the global world that all of the points that karen brought up, even given that it is elevated. market doesn't care about these things until it does but it is clear that 1.6, which probably by the way is probably closer to 1.8 depending on the numbers you use, it is a bit of a red herring and it is something that the market looks completely past for at least the last six to eight months.
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>> well our next guest said a market pullback could happen at any moment let's bring in head of u.s. equity strategy at rbc, lori great to have you with us. so based on which metric do you think valuations are full? >> we don't pick and choose. we have a combo model that bakes together 34 different metrics and some are market cap and equal waited we use median multiples as a bottom up assessment valuation and it is price to book, price to sales, you name it we have it in there and it is telling you we're at sky high valuations if you just look at the s&p on its own relative to history. so that does make us vulnerable to a pullback if we get the right catalyst to come along but i told my team, while i expect a pull back at some point this year, i think the timing is very uncertain because it is very unclear what catalyst is going to knock that down or when it would actually happen. >> at the same time, you would
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use a pullback to go more into the inflation trade so you believe this is an area that will continue its gains? >> yeah, and i think the market call right now is much easier from a bottom up as opposed to a top down perspective so when i put the issue of frothy development aside and i look at financials and energy and small cap, these are all areas that look deeply undervalued, they're also areas that tend to work when you're in the quote/unquote inflationof the economy so when inflation is rising and bond yields are moving up so the question is really that trajectory to going to continue and i think we're going to get to an interesting point right now where we've all been talking about 2021. when does 2022 start to come into view. how much runway is there so i tried to be clear with my team, we're not concerned about repositioning our calls, for a 5%, 10% pullback we might get in the market we want to reload on the inflation trades to get exposure
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for the long-term catalyst that we see there. >> lori, it is tim agree on the inflation for sure and i want to get at where you just were, focus on 22 eps because to me, we've given mulligans for last five quarters when do we stop giving that mulligan when normalized earnings have to come back isn't that the time to sell or maybe just before that >> i think what is really weird right now about earnings expectations is that we're seeing these mechanical upgrades to the numbers in dollar values but the eps growth rates aren't getting lifted so last year's numbers came in better than expected and people are bumping up these numbers and it all offsets so it is like 9% earnings growth is the consensus call for next year the question to get this market going in a big way is whether or not you could boost that number. you could get from 9%, 11%, to 12% and i think we're in a weird period, i pause using the word
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"weird" but we have these inflationary pressures looming in the distance which could eat into margins but we have tremendous amount of operating leverage out of the pandemic we have a gdp and tail wint that are back which is good for margins so there are conflicting cross currents and i think investors frankly need more information to be able to get more bullish on earnings expectations i don't think the market has enough information yet from an earnings perspective to make that call. we're going to get it soon but we're not there quite yet. >> lori, it is karen let me just ask you something about interest rates we had a glimpse of what might happen when rates start to really move. do you have some sort of cap in mind that below which is fine an then it started to really effect multiples? >> yeah, i will say that all of the work that we have done points to a ten-year treasury yield north of 3%. that would really kind of get you worried and whether that is looking at the percent of stocks
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with the dividend in yield and looking at the earnings yield gap analysis and looking at the history orrical move it is about a275 basis point or higher move that spooks markets, moves below that markets tend to be able to digest we just did an investor survey before the long break and we said where do you think the ten year treasury yield starts to become a problem and expectations were kind of all over the place two-thirds of the respondents said above 2.5%. so that is telling you that there was all of this focus on 2%, 1.5%, this too far too fast and even the people out there buying stocks, a lot of them don't think we have more runway before we start to pinch valuations. >> and your model is 3% as the line in the sand, lori. >> we have one that shows 3.3% and 3.8% and i understand where people are coming up from the 2.5% number because when you start to kind of get 3% in view, that is mib when you want to take the risk
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off the table. >> lori, great to see you. thanks. >> thanks for having me. >> guy, that is quite a runway if you go up to 2.5% and the notion that inflationary pressures could be offset by oper operating leverage we were talking to tom lee about that yesterday who thinks there is tremendous operating leverage to be exercised by companies. >> clearly the case. input costs clearly people looking past and i'm not suggesting lori is saying this at all, but that move to 2.5%, depending on how quickly it happens and i do think we're going to 10% at ten year, i don't think the market is ho hum up until this point and there is a wakening at 2.5% where things fall off a cliff i understand why people would suggest.5% my concern has been the speed with which we have gotten to 1.7 and i think we'll see up to 2% over the next few weeks. wee see if i'm right clearly the market didn't seem to care.
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it cared for about three days. >> it didn't care yesterday when we had record high closed, dan. >> they don't care because they're looking at real yields so if the fed is felling us that inflation they're ready to let it run hot and saying it is a bit transitory and talk about operating leverage on the other side of things and you look at where the ten year yield is 10.6, you still have yields that are negative and that is a big part of tom lee's call here, is that if we're in a situation where what are the alternatives, agt right now equity looks attractive to yields and inflation expectations. >> coming up, a big win for sports betting ruling out of new york that could mean jackpot for a couple of names high on our radar and take a look at how sharings are faring two chip makers holding a shareholder meeting tomorrow we'll hit the options market for thatra tde stick around much more "fast money" straight ahead.
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welcome back to "fast money. we are watching the gambling stocks after hours after new york state approved mobile sports betting with a limited operator model as partof the $200 billion budget plan no official word on when it will
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go into effect the online stocks finished the day mixed and we're seeing a bid in draft kings tim, i go to you on this one. >> yeah, and it is clearly a function of addressable market growth and that is the formula that analysts are applying to where you price draft kings and it is on a price to sales basis and it is expensive. you're buying into the concept in its secular trend that look it is -- what we saw with cannabis, too. look at the states that are legalizing sports betting and cannabis and the shortfalls. this makes a lot of sense. if you look at draft kings, during that high multiple hit from within the market of which companies were most vulnerable, this one was but that trend line from octobe at a high stock price, stocks held that even the bottom end of it so i think it goes higher. >> yeah, guy >> $63 was the september -- 63.5
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at the september 2020 high and tim sold off the secondary and sold off hard but recaptured it. i think you stay long this name against the september high which is 63 and change. coming up, the big bet on crypto, ahead of a highly anticipated listing next week and breaking down the details next. and two chip makers ready to join forces. how options traders are plugging into this one. "fast money" iba itws ckn o.
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welcome back to "fast money. coin base giving investors one last speak at the financials before going public next week. kate rooney joins us now with the numbers. kate. >> coin base benefiting from the recent rally in bitcoin. the crypto company putting out estimated earnings of rough by $1.8 billion in revenue. that is more than it made in all of last year and a nine fold increase from the same time a year earlier the call did just wrap up. the ceo brian armstrong and cfo didn't take any analyst questions. they did underline bitcoin's role in the quarterly performance and the role in guidance going forward they say the coin base revenue
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is quote highly correlated with the price of bitcoin and volatility and as she put it, we could not forecast the price of bitcoin any better than you could and as a result, she said it is very difficult to accurately forecast their revenue. as a result, coin base outlined three different scenarios. a high, a mid and low range based on monthly transaction users. some other highlights, the company is profitable. it has 56 million verified users and a lot of growth on its institutional side coin base now has $122 billion in assets from hedge funds, family offices and other professional money managers, up from $45 billion and it is half of coin base's total assets. all eyes are on the direct listing on wednesday of next week trading on the private market has coin base's valuation pegged around $68 billion and bitcoin's market cap meanwhile topped $1 trillion
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this year. around this time last year it was about $130 billion melissa, back to you. >> thank you, kate rooney. i was talking to an early investor in coin base not too long ago and i said what you if you invested in bitcoin versus coin base, would you have made more money and he said absolutely he didn't say it regretfully, he just said that he invested in coin base because it was understanding the process in terms fts crypto universe and the possibilities there. he made a number of other investments, et cetera, et cetera, but i think that is the question the question is are you better off buying coin base as a public company or bitcoin karen, what would you say? >> i would say coin base because you have clearly, clearly, clearly, it is tied to bitcoin but not only tied to bitcoin, right. let's say other coin emerges,
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say you're -- of many different coins, right so you have some diversification there. bitcoin is tied to bitcoin i don't think it is tied to coin base but the other way around. so i would have the less risk by a little more diversification coin base. but i am long bitcoin, i'm not long coin base. >> that is why i asked you but it is worth noting that this moment in time, the correlation between bitcoin and the other coins out there, they are square something in the .9s for a light coin so you're not getting a lot of diversification right now but the poin being eventually those could diverge that is a good point to make dan, what you would say in this game of would you rather >> you know, i get confused by this game, mel i would say right here, right now, coin base, i think bitcoin is up 100% or close to that this year and up more year-over-year but i would think about coin base about charles schwab 30
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years ago if you believe that most assets that are going to be traded are tokenized at some point in the future, i think you want to be with one of the first established players and coin base would be one. >> weren't you going to say robin hood i thought we talked about this on the call. you have this provocative time you were going to the break the rule with my permission and bring up a third choice that i didn't lay out to you and that would be robin hood. >> no. but it was a false choice. if you were to ask me, the point was it was a good question i was thinking about it wrong. but an interesting question might have been robin hood which is going to list pretty soon or coin base is going to list pretty soon. i would still go with -- i get long coin base and short robin hood, how is that to play your game. >> that is an interesting one. i'm satisfied, let's move on one chip maker is gets a lot from the options traders today and the spot boom hits the tops
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cramer cam he's talking with honeywell and will i am. catch that full interview top of the hour on "mad money." we're watching shares of amd and zieling as they look to finalize the $35 deal and they are putting bullish bets on these trades mike khouw, what do you see. >> maybe both of the names because it is a stock deal so amd shares have been essentially the currency used and that is where we saw the volatility. today most active options were the 82 strike calls expired at the end of the week and they traded for about a dollar so the call buyers were risking 1.2% of the amd stock price to make bullish betss that it could go above the 82 strike and representing an increase of about 3% from where is trading. >> thanks for that, mike
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tim, where would you go in chips at this point. >> it is interesting you didn't ask me this but if you does a would you rather on ceo's and intel and amd, you have a dynamic here where i think you get lisa sue versus pat gellinger and this place in the cycle for the companies, i choose intel so maybe that is me answering your question. i like this turn around story and it is not reflective in the next probably six quarters but this is the investment we wanted to see out of intel. this is a stock underperformed massively, given a lot of market share and i think there is a lot after head of them. >> and they just unveiled a new data chip today. you sort of answers that mike, thank you for that tune into the full show of option action at 5:30. the latest company to get in on
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topps best known for baseball cards and bubble gum is going public through a, you guessed it, a speck. it topped at $1.3 billion so does this top the bubble in the spak space i'm trying to think of other puns to throw in there tim? >> look, i think we're in the early innings of this one, mel and i think you have a case where -- look, i think the spak structure, i automatic actually a believer and i've been involved in one and i've invested in them they're not all the same you're investing in the team that will find the right deal and then you vote on it. so i'm a huge baseball fan and collecting baseball cards since i was in 7th grade and i'm thrilled to hear they are valuable against. >> port of the team is a former disney ceo, eisner, this is an interesting team and they're venturing into nft's because why wouldn't you go public and enter
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the nft market because it is 2021 >> i think it is fantastic mike has come on the show all of the time back in the day as you recall he should come on again instead of going on with ars and crew in the morning. is it a sign of a top, no. is it a sign that the bubble gum was horrendous, i think as sorkin was talking about and joe kernen, this morning, absolutely if they could reto fit that gum and put bubblicious in this, i think i would invest in it. >> i think the problem is then it would stick to the card and so that is why it is so rigid and not moist. anyway time for the final phrase. tim, what do you say >> i think morgan stanley 10% pullback, we've had a lot of conversations on archegos, i think it is a pull back to buy but wealth management biz stays strong. >> karen >> i'm looking for value back to
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big cap pharma today merck. >> dan >> guy pushed amd recently and i like it here >> guy >> great call on gonzaga, mel. snap. >> i'm sorry thanks for wchating "fast money. thanks for watching "fast money. "mad money" with jim cramer starts now my mission is simple, to make you money i'm here to level the playing field for all investors. there's always a bull market somewhere and i promise to help you find it. "mad money" starts now hey, i'm cramer. welcome to "mad money. welcome to cramerica other people want to make friends, i'm just trying to make you some money my job is not just to entertain but to teach, educate, put it in context. call me at 1-800-743-cnbc or tweet me @jimcramer. every day we discove

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