Fast Money Recap - Finding the Good in Goldman (11/11/08)

A Recap of CNBC's Fast Money, Tuesday November 11.

 

Burlington Northern (BNI), Hewlett-Packard (HPQ), IBM (IBM)

 

Stocks fell on Tuesday, major indexes lost 2% and 29 of 30 Dow stocks were down. Guy Adami would "buy dips and sell rips" and he is happy with the solid trading range. Pete Najarian noted Burlington Northern's move from $80 to $84. Hewlett-Packard and IBM were both down and Najarian thinks these stocks may be buys for investors who think emerging markets will recover soon.

 

Finding Good in Goldman Sachs (GS)

 

Goldman Sachs CEO Lloyd Blankfein commented that the bank's transition into a bank holding company will not "material impact" on its business and said there is ample opportunity for a purchase of deposits in the future. Although the conversion of Goldman Sachs and Morgan Stanley into bank holding companies have meant a fall in stock prices for both Goldman and Morgan Stanley, Guy Adami says there is nothing wrong with Goldman, and it is getting treated roughly by The Street because it has been quiet. Tim Seymour thinks earning losses don't affect the company's book value and Karen Finerman said at least credit default swaps have not moved substantially. If asked whether those holding Goldman should sell, the rest of the group said "No" while Finerman declined to give an answer.

 

Oil Dips: Petrobras (PBR)

 

As oil fell below $60, Adami says there is no money coming into commodities right now and said oil might be a decent trade in a year. Finerman thinks shorting oil is a good idea, while Seymour is bullish on Petrobras.

 

GM (GM) on the Skids

 

With General Motors dropping to a 66 year low, there is more talk of a government bail out of the auto giant. Jon Najarian thinks selling clean diesel cars domestically is part of the answer to the problem in the industry and relaxing crash test standards in favor of producing fuel efficient vehicles. Since a bailout will be complicated and expensive, Jon Najarian thinks the government should extend loan guarantees instead of giving actual cash. He would cut his short positions on autos, because there isn't much downside left in the auto industry.

 

Hedge Hogs: U.S. Steel (X), Mastercard (MA), Freeport McMoRan (FCX), Cleveland Cliffs (CLF), Alpha Natural Resources (ANR)

 

Hedge funds are expected to release information about their holdings this week and Finerman notes this is an opportunity to see how forced liquidations affected the funds and the aftermath of Black October. Hedge funds to watch include: Citadel Investment Group,  Atticus Capital, Harbinger Capital Partners and Pershing Square Capital Management. Stocks to watch during filing season: U.S. Steel, Mastercard, Freeport McMoRan, Cleveland Cliffs, Alpha Natural Resources.

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2008 Nov 12 09:28 AM