'Fast Money' Recap: Bracing for Change

Dylan Ratigan hosted CNBC's "Fast Money" show Monday night. He kicked off the show with a discussion of the reduced volatility in the stock market for a third day in a row. Guy Adami said the "new norm" could be volatility at 45 or 35.

Jeff Macke says, "Now the market crisis is that it's so slow, people are going to tune out." Karen Finerman mentioned that she is delighted to see the decrease in volatility. She says, "Hopefully we will get back to a market that focuses on fundamentals." Tim Seymour explained that today's ISM and PMI numbers were horrendous. He says, "Every major house on Wall Street reduced economic growth numbers for the fourth quarter and for 2009."

Ratigan asked the traders how they go about evaluating and integrating the possibility of more bad economic data compared with current stock prices. Finerman told viewers to focus on the balance sheet. She says, "Anyone who can withstand further deterioration in the economy is where I feel more comfortable."

Macke said to avoid the value traps with low price-to-earnings ratios in the coal and steel sectors. He says, "The trailing earnings are fine, but the forward earnings are much too high as the economy comes to a halt." Adami said it feels like this market is pricing in a "this-time-next-year recovery." Seymour said that emerging markets like India and China can be played now.

Ratigan moved the discussion to General Motors(GM Quote), which reported a 47% drop in October sales. Macke told viewers to short Toyota Motors(TM Quote) as it gets back into the mid-$70s and low $80s with a stop at $85. He says "the fundamentals at Toyota are an absolute disaster." Seymour said one short to be careful with is Volkswagen(VLKAY Quote).