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'Fast Money' Recap: Bank Rally Lacks Substance

NEW YORK (TheStreet) -- The financials rallied today on reports of a a $1 trillion mortgage refi plan that the White House later denied it was behind.

Melissa Lee, the moderator of CNBC's "Fast Money" TV show, asked the trading panel and experts to sort out what happened.

Chris Whalen, senior managing director for Tangent Capital Partners, said the market reaction was the opposite of what it should have been. He said the big banks don't want to get into this because they don't want to deal with second liens.

For a breakout of some stocks from a recent "Fast Money" TV show, check out Dan Fitzpatrick's "3 Stocks I Saw on TV."

3 Stocks I Saw on TV

Whalen said the Fed has done everything it can. He said the real culprits are Freddie Mac and Fannie Mae and the larger banks that have been sitting on their hands with regards to refinancing the bottom third of the market.

Tim Seymour said the financial space didn't need this report because the bank stocks have been pricing in better loan growth and a better reaction on the mortgage side.

Brian Kelly said today's financial rally was actually in reaction to the white paper from the Fed about getting foreclosed homes off the balance sheets of banks and turning them into rentals.

Turning to today's mixed retail sales results, Lee noted that Target (TGT) missed analyst estimates. Terranova said Target's undoing came at the hands of Walmart (WMT), which did a very good job of promotions over the holiday season.

Another retailer that didn't do well was Family Dollar (FDO). Scot Ciccarelli, of RBC Capital Markets, said consumers simply went elsewhere for discretionary items. Dennis Gartman said the dollar stores will lose sales as the economy gets stronger and consumers move to higher-end stores.

Commenting today's boost in ag stocks, Gartman said companies like Monsanto (MON) and Mosaic (MOS) are getting a boost from dry, hot weather conditions in South America, particularly in Argentina and Brazil.

He said the situation should help the U.S. corn crop and producers of fertilizers and nitrogens. Terranova added his picks of CF Industries (CF) and Darling International (DAR).

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