Fast Money Recap

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'Fast Money' Recap: AIG Not Only Downer

TSC Staff

Thursday closed with the bears taking control of the markets. The Dow lost a hefty 1.93% to 11431.43, the S&P 500 fell 1.79%, ending at 1266.06, while the Nasdaq shifted 0.95% down, finishing at 2355.73.

On CNBC's "Fast Money" TV show, the traders opened the show to a brief discussion on today's market activity.

Starting off was commentary on American International Group(AIG). Already disappointing two times previously, did it a third time, and it was not alone today.

Dylan Ratigan said that Citigroup(C) was down nearly 6% today and are having auction-rate security issues alongside Bank of America(BAC).

Moving on to today's retailers, who reported sales, Wal-Mart(WMT) disappointed with dismal a report. Joe Terranova weighed in, saying that retail sales were "awful."

Jeff Macke chimed in, saying that today there were "plenty of reasons to sell, not a lot to buy," and that he ducked and covered.

Speaking on the financials and auction rate securities, Karen Finerman said that after Citi settled, she does not see how the other banks can't do the same. She said that UBS(UBS) "has some liabilities," and she is short BB&T(BBT). She noted that BBT does not have auction rate securities, but it does have commercial and construction loans.

Guy Adami said that he thought today would be "AIG specific," but the Andrew Cuomo thing was a game changer. He said that today was a "horrible day for Merrill Lynch"(MER).

Macke said, "I do not want to own them yet," and that the Cuomo news is "horrible for the banks." He said that it is too late to short, but to "buy the panics."

Finerman suggested going with Capital One(COF).

Moving on to retail, Finerman said that she bought into Abercrombie & Fitch(ANF) call spreads. She said that their news today was "bad, not horrific," and that today's reaction was "excessive to me."

Adami said that he would "take a shot," on Abercrombie just on a valuation basis because he is expecting a "short-covering rally."

Moving into the technology sector, Ratigan said that Intel(INTC), Microsoft(MSFT) and Hewlett-Packard(HP) "looked lovely."

Finerman agreed, saying it was encouraging and that MSFT deserved so come up a little because it had been beaten up excessively.

Adami said that Intel's gains were wild and investors "can't argue with those numbers."

Next, guest Jeffrey Harte of Sandler O'Neill stopped by the show to discuss the financials. He said that right now "uncertainty is your enemy," and that when it comes to auction rate securities, there "haven't been a whole lot of losses there yet." He compared it to the CDO market and said that ARS are "not so bad."

Moving on, Harte said that there are more marks to come and that "housing is going the wrong way." He continued, saying that we "may have a long road ahead of us," and that it is wise for investors to "watch for the turn." Harte wrapped up, saying that there is an "awful lot of cash on the sidelines," and that there is going to be a "spring loaded recovery," when the time is right.

After not being seen in a while, the United States currency has been seeing some strength. Terranova said that it is at its highest level since Feb. 27 and that it "put oil in a headlock today." He said to be cautious because investors do not believe the move yet.

Finerman echoed his warnings, saying that she wouldn't add to her short position in the British Pound.

Macke said it is best to "trade this off the technicals," and you've "got to be long." Adami agreed saying that the dollar is "the trade of the second half."

Terranova pointed to gold, which he said is "rolling over now."

Bringing on options expert, Jon Najarian, "Fast Money," moved on. Najarian said that right now there are trades to be had in the market and that investors "can't decide if they are bullish, bearish." He said that it is not fear but there is no commitment on either side. Speaking on his most compelling trade, he agreed with Finerman on Capital One "on the short side." Najarian said that it is trading "six times normal volume, buying puts," and that its peers are down nearly 30% while COF is down only 8%.

Discussing housing stocks, specifically Home Depot(HD), Adami said that the housing pricing fall will flip to affordability, which is good. He continued, saying that "things seem to be slowing," but he is not saying to "go get Home Depot tomorrow."

Macke brushed this off, saying to "run away from this sector."

CNBC's own Charlie Gasparino made an appearance speaking on Merrill's comments on auction rate securities and what his thoughts are. He said that he does not feel it is a "balance sheet issue," but rather a reputation issue. Gasparino said that Merrill is a very powerful brokerage house and that its brokers have complained to upper management and are demanding that they "make their clients whole," because the brokers do not want clients pulling their accounts.

Quickly running off final trades, Macke said that he would "sell the Financial Select Sector SPDR(XLF)," Adami said that Johnson and Johnson(JNJ) "continues to perform," while Terranova said that "Research in Motion(RIMM) "wants to go above 30."