We start off with autos. Very bleak picture for auto sales in the month of may. Numbers tanking across the board. Gm and ford falling hard today. What are the dismal may numbers signaling . Autos, trouble. Autos have been a huge driver of gdp growth since 2009. Cash for clunkers. Then subprime loans exploding. Now, mike jackson was on cnbc back in january. Hes the ceo of auto nation, the largest car dealer. He said back in january that things were slowing down. Whats interesting is the automakers, they increased production. So now we have an inventory problem. We have almost three times as many cars in inventory as are being sold. At that level, thats the last time we saw that level was back in 2008. And that generally signals the peak of an auto cycle. We talked about the peak, but as that comes down and you start to see ford and gm start to take some production offline, if this really is peak auto, thats going to start hitting unemployment, thats going to start hitting gdp growth and filtering through the economy. Is this an auto stock problem, or symbolic of whats happening in the economy . I dont think its symbolic. People bought all the cars they need for now. A lot of people have been talking about peak autos for quite some time. The may numbers indicate maybe theyve been right. As b. K. Has been saying for a while, maybe they are correct. I dont think it speaks to the health of the consumer. I think it speaks to the fact that enough cars have been purchased and theyll move on to something else. You look at home depot and certain retailers doing okay. With that said, i dont think the consumer is in great shape, but i dont think you can discount the consumer entirely because of these numbers. Consumers are not buying sweaters, or shoes, or whatever theyre not buying, these smaller goods, because theyre buying big things like autos, and houses. Or big things like cars anymore, because thats where the weakness was in the sales numbers. Will they return to buying the sweater or kulats or what have you. I hope they do. I think that some of it also in travel, weve seen huge travel numbers. Dining. I think the home depots of the world are still doing well. Well see if its more than a onemonth blitz. Its interesting that gm has been down, and just not trading well all year on the fear that were going to autos are going to peak. Its very frustrating probably to be a gm holder and have it trade down on this news for so long. And now it trades down again. Right. And this is the beginning then, its not going to turn around so quickly. Is there a trade in the auto sector . Stay away from the autos, and go to the auto parts type makers. The interesting part is within the autos, if you really separate it out, it was automobiles that struggled. It was the ones that actually get the best fuel efish si. Again, part of that trade with oil. Oil started to rocket up to 26. Today we saw Movement Just like yesterday. Today, nice reversal off the lows. But its interesting to see if you look at the ford numbers, f150, it was the lower end models that struggled. Construction sales are down 1. 8 lower than expected today. Obviously the trucks are used in construction. I still think this is a the Housing Market is decent. Pickup trucks, though, i dont think thats fair to say thats all construction. Theres people like me, a lot of folks out there that would have gone to the more fuel efficient car that pushed to the pickup truck. Lets bring in our expert here, phil lebeau. Sorry i missed you yesterday, phil. It was declined specifically in car sales that was pretty staggering. Do you think thats a permanent thing . I think its permanent might be a little extreme. Lets say we have gas spike up to 4 a gallon, within two years, youll see people rotate back in. You have more crossovers that are available. Because you have more fuel efficient crossover into suvs. People are saying, why am i buying a cruise or a fusion. Sedans are just falling out of flavor. It doesnt mean theyre not, you know, decent vehicles, they are. Theyre better than ever before, across the board. Whether its asian, european, domestic. People want the utility. Thats the shift youre seeings here. As you date whether or not we have peak or plateau autos, look at the overall sales rate for the year. Were still in the high not high, but low 17 millions. Last year was 17. 46, a record pace. What if it comes in at 17. 3. People will say theyre down year over year, but still, you take it. You take anything over 17 million. Its a matter of whether or not the automakers are going to be able to manage the top here. To your point about inventory, rook look at gm. Its down to 71 days. Thats something investors should want to see. Not just gm, but all the automakers. Whether it can keep it in the 60 to 75day range, preferably down to the 60. What would the auto bulls say about the stocks performance . That doesnt jive with whats going on. Were not far off from peak here. I bring this up with auto executives. You ask us to get our north american Profit Margins above 10 . Weve done that. You ask us to be more profitable per vehicle, weve done that. You guys are more expert in this, in terms of investors, i think vefrt sentiment is, this is as good as it gets. Why should i buy these stocks expecting it to go up in the future. Its flux twactuated at 30 d. In an environment where auto sales are through the roof. So what is the environment that im asking the question youre trying to answer. What is the environment they need for the stocks to go higher. Im at a loss to figure out. You even talked with those who were skeptical about the auto industry. Activist shareholders, theyre baffled. Theyre like, what else do we want these guys to do . You want consolidation in the industry . Youre not going to get the kind of consolidation that people would want. You would have to have major automakers come together and get economies to scale, build 20 million vehicles. Whos going to say, sure, come on over, you can take us over. The only one who wants to be bought right now is fiat chrysler. Jeep, three times more jeeps were sold than all other cars made by fiat chrysler. Cars, not automobiles, but cars. They dont want the dodge dart. Thats not a knock on the dodge dart. Cars and sedans have fallen out of flavor. Do you think tesla is watching these mass market vehicles . We talked about this. I think theyre more focused right now on what their inventory shows in terms of the reservation backlog. I think thats what theyre focused on. No worries so far . I wouldnt say no worries completely, but i dont think they say, people have had enough with cars. Good to see you. Phil le bea. Pete said autos are not a trade. The automakers that is. I agree with pete. Gm and ford, gm, again, 30 now. It was 30 this time in 2012. Its vacillated to the other side. Its also been in a descending level. It continues to make lower lows and higher highs. I think the trade if you want to be in it, listen, i think tesla gives you an interesting risk reward. I think they price the secondary a week or so ago. Traded decently off that. If you want to trade with, i think, low risk, high reward, tesla 215. The auto sales are symbolic of the broader things going on in the economy. Whats that trade . Thats just your bigger macro trade that earnings are going to come in generally so you want to be short the s p 500 or Something Like that. I think more specifically, you can be short ford. You can be short gm. I would also look at car max, kmx, which is the largest used car dealer out there. Weve seen used car prices come down. A lot of used car owners now are underwater on their debt. So i think thats another place you could play. If for some reason you wanted to be crazy and actually buy something, look at penske auto group. And they tend to be in the jeep area. They would probably do a little bit better. Its just impossible to reconcile the valuation differential between gm and tesla. Well, yeah. It really is. Gm couldnt be more out of favor. You have to have such a longterm the best thing that could happen to gm is a big trough. And people will start to look forward. Now all theyre doing is looking down. Up next, lululemon founder taking direct aim at the companys letter. The comments you need to hear. Plus, if youre worried about a june swoon, well tell you how to beat it with the three stocks that always perform well in the hot summer months. And later, opecs on deck. Were going to hide out in the oil trade. The best picks. Much more fast money right after this. Need to hire fast . Go to ziprecruiter. Com and post your job to over one hundred of the webs leading job boards with a single click. Then simply select the best candidates from one easy to review list. And now you can use zip recruiter for free. Go to ziprecruiter. Com. Welcome back to fast money. A big day of gains for lululemon, after the founder took aim at the board in an open letter pushing for change, noting how the company has fallen behind its competitors. He spoke earlier today on cnbc exclusively. Take a listen. If you see what lululemon is doing, theyre just rolling out stores. Theyre not morphing into anything new. They say theyre doing theyve got technology, they say theyre doing innovation, but i might be the number one person in the world to understand that. And i dont see it anywhere. It comes on a day where nike gets two downgrades. Under armour had their issues with sports authority. And lulu, the interesting thing over the last couple of weeks, look how well that stocks been trading. Look how it traded today. I actually think this Management Team is getting this thing done in a very difficult environment. We know leisure is getting more competitive. Its an under armour, adidas, a pe of 26, not overly ridiculous. Look at the Revenue Growth from 1. 3 billion to over 2 billion. I see a company that is making a transition from somebody, maybe the gentleman we were just hearing, who actually did many things that hurt that stock, and hurt that company over time. And theyve had to fix that, and in the process, theyre fixing it and they are getting more innovative. Its just not for women anymore, theyre moving towards men and children, getting the next generation. I think lulu is doing a lot of the right things right now in a particular environment. You read the letter. I read the letter. There was one line that i really appreciated. He was comparing the underperformance of lulu to both under armour and nike. Lulu stock dropped in the same period. In the midst of the greatest change in the way people have dressed in the history of the world. Hmm. When they moved from loin cloth to pelts to fur, it was leisure, i mean, thats i recently made that change. No doubt. No doubt. Heres the thing. So he talks about getting the board to destagger. And many delaware corporations, and most, the overwhelming majority are destaggering. And they should do that. I wondered, why didnt he just put up nominees . Exactly. Because i think if someone knows this for certain, i would love to hear it, he couldnt. It was a standstill, i believe. Oh, i see. Now he may be able to do that in the future. Right. I also wondered if he was going to make a bid for the whole thing. I dont think thats going to happen. Yeah. On june 8th, im in the camp 32 Short Interest. I think whats going to happen here is youre going to have people continue to cover shorts into the earnings release. How do you trade it . I think you stay long in earnings and take a shot either way. I think its fair. I think now the path of least resistance is higher. Id really love to know how the kulats are. Oh, come on. No, sure like shorts and pants that have wide legs. More like a grasso type of thing. It looks like a skirt, because its so full. Thank you. Now i learned something. You always learn something. Take a look at michael kors. Setting a doubledigit rise in sales. The Company Warning that increased spending will chip away at its bottom line this year. Karen, there could be a little war brewing between it and Department Stores. It was interesting, the stock had been crushed over the last couple of months, on all these things, and yet still it matters to perform. Outstanding quarter. They did a tremendous job. But they did point out, if Department Stores are going to be promotional and they have to be to drive traffic, because mall traffic is down, that kors is not going to allow their brand to be damaged by being too promotional. Meaning theyll pull their stuff from the stores . Not all. But they will allocate, i guess, is a better word. And that is sort of important. So the mix will over time be more kors in retail, and online. And the balance of power is shifting a little bit. They took great pains to say we value our Department Store partners. However, were not going to allow them to do that. We saw some rumblings between nordstroms and kors that seems to be overdone. But thats a shift. That seems like bad news for the Department Stores then. It could be bad news. But retail traded pretty well. Xrt, look at some of the names in that, that traded pretty well. So if people are no longer buying cars, and you think theyre going to buy stuff, like kulats, i would say at least you have a good risk reward. You could have your kulats and jeep i have them already, i just didnt know what they were called. Just saying. My whole weekend bank of america on our show yesterday. Summer swoon lurking around the corner. Weve got the three stocks that according to history always perform well in the month of june. Well give you the names. Youre watching fast money. In the meantime, heres what else is coming up on fast. To be or not to be. More like to freeze or not to freeze. Thats the real question. And now that crude oil is hovering right below 50 bucks, well tell you whether theres any chance opec will freeze production at tomorrows key meeting. Plus that pretty much sums up whats been happening to biotech stocks in the path month. But has the space come too far too fast . Well tell you why some traders are betting on a breakdown right around the corner. Much more fast money after this. You recommend synthetic over cedar . Super food . Is that a real thing . Its a great school, but is it the right the one for her . Is this really any better than the one you got last year . If we consolidate suppliers whats the savings there . So should we go with the 467 horsepower . Or is a 423 enough . Good question. You ask a lot of good questions. I think we should move you into our new fund. Ok. Sure. But are you asking enough about how your wealth is managed . Wealth management, at charles schwab. Plumping surface cells for a dramatic transformation without the need for fillers. Your concert tee might show your age. Your skin never will. Olay regenerist, olay. Ageless. And try the microsculpting cream you love now with lightweight spf 30. Welcome back to fast money. Bank of America Calling for a summer swoon as june rate hike expectations jump. If we see a june swoon, there are a few names that always buck the downtrend. Paul is here with your best bets. Paul, youve been taking a look since 2009. Youve got three stocks. Yes. June is historically a weak month for equities. There arent a lot of big winners. The only stock in the s p 500 that has gained more than 5 is facebook, and its only been around for four years. Its been up every year the month of june. Average run about 5. 7 . The next stock interestingly is amazon. Which is up 53 since its february low. Average gain of about 3. 9 . One down year. Whats interesting, facebook and amazon are neck and neck in market cap for the sixth Largest Company in the world, in the u. S. , which i found surprising. And the third one was just in the news yesterday, allergen, averaged a gain of 3. 7 , down in 2010, and 2015. But when you look at the intramonth pattern in the month of june, using intraday data, we can create a composite, and it starts out flat. Usually peaks right at options expiration. The following week you see a peaktotrough decline of 2 . This year i think with brexit, june 23rd, you can see some jitters coming into that vote around options expiration. If we dont have the brexit, if they dont vote to leave, you could have a relief rally toward the end of the month. Is that what youre seeing in terms of the volatility out there . I would think so. Its been so low for so long, that its absolutely incredible. Its interesting that you bring up the options expiration aspect. Suddenly the protection that people have on, theyre a little bit late and lax in terms of putting it out there again. I dont know that i would pick names like facebook or amazon just based upon june. But you certainly have to look at some of these names. And you heard what was said the other day, there are a lot of reasons why even with that valuation, look at amazon and say, wow, they seem to be doing everything right. Facebook seems to have the right guys. Zuckerberg doing everything right. Those are great companies. I understand why they would react in june as they have. Amazon fresh alltime high. I would be shocked if none of you thought it sounded like the speech of a ceo sitting at a Company Whose stock price may be topping. He was full of such confidence and grand plans. But hes always every time ive heard him speak, which is often, he sounds like this. Maybe its just linking the stock price with his euphoria, or maybe it was the way he was speaking. But it didnt seem any different than he typically sounds to me. The stock has been resilient as can be. We went to 720 last earnings period, and completely failed. That stock traded 500 within a month. Makes you wonder if theres another leg. Ill say this quickly. Out of all those names pete mentioned a couple of weeks ago, allergen, report in july. 14 times forward earnings. I know carl got into the name. Never thought it would get through 220 on the down side but its still cheap here. Paul, before you go, worst performers in june since 09. Oracle is the worst performer, decline of 4 . Philip morris international. You have jpmorgan. And then the fourth worst is actually Philip Morris and altria. These different dents, safety stocks tend to see some weakness during this period. You see that in other names as you go up the list of worst performers. I wonder if you have if you put together what you were saying about the jitters the end of june and weakness in some of the safety stocks, or had been safety i would not want to be in facebook if we get june swoon. The reason why is look back what happened in february. These are such crowded trades right now. It has nothing to do with the company, its just these are things people want to sell because they can sell them. If youre afraid of whats going on in the market, dont buy facebook or amazon. Theres other places to be. Paul, thank you. Up next, will they or wont they announce a production free