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Dennis Gartman: Euro Crisis Ends Like This

More than a year before the Street started predicting the demise of the euro, Dennis Gartman said it was inevitable.

It was Monday November 29th 2010 when Gartman first talked about it on CNBC’s Fast Money Halftime Report.

At the time his forecast wasn't mainstream, like it is now.

In 2010, most prognosticators were saying the EU would remain in tact, no matter what. Anything less, they said, would be unthinkable.

But Gartman countered that after hundreds and hundreds of years of conflict between the member nations, it was unrealistic to expect them all to set aside such strong cultural differences -- especially after only a handful of years.

Gartman said leaders would be voted out of office and ultimately the EU would crumble, with nations in southern Europe leaving the fold.

Flash forward about 18 months and Gartman's controversial prediction looks somewhat prescient.

Considering his ability to foresee events so far, we were curious to learn how Gartman expected the crisis to play out in the long-run.

You may be surprised to learn Gartman sees it playing out quite positively.

“Greece will go first. They’ll get the drachma back. It will be chaotic in the interim, that part will be ugly,” he says.

But then something good will happen.

“With the drachma very weak against the currencies of most major nations, tourism will start to pick up, because visiting Greece will be cheap for international tourists.

With tourism becoming a growth engine for the Greek economy, Gartman thinks in time Greece will begin to thrive.

But Gartman doesn't stop there.

He thinks other nations with big tourist industries will then want to exit the euro to boost tourism -- particularly Italy. "Yes, Italy," he says.

According to Italy's Ministry of Foreign Affairs, the tourism industry accounts for more than half of the gross domestic product (GDP) of Italy.

"Eventually Rome will bring back the lira," Gartman says. A weak lira could do wonders.

Posted by CNBC's Lee Brodie





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Trader disclosure: On May 11, 2012, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Patty Edwards is long JWN; Patty Edwards is long BMO; Patty Edwards is long BKCC; Patty Edwards is long GLD; Patty Edwards is long INTC; Patty Edwards is long PVH; Patty Edwards is long JNK; Patty Edwards is long LQD; Patty Edwards is long T; Patty Edwards is long NKW; Patty Edwards is long MSFT; Jon Najarian is long GGLU; Jon Najarian is long DDMD; Jon Najarian is long CME; Jon Najarian is long CBOE; Jon Najarian is long CIGX; Jon Najarian is long call spreads in CNO; Jon Najarian is long call spreads in AAPL; Jon Najarian is long call spreads in SPLS; Jon Najarian is long call spreads in JPM; Jon Najarian is long call spreads in MSFT; Jon Najarian is long call spreads in VIVID; Jon Najarian is long call spreads in ARNA; Steve Grasso is long ASTM; Steve Grasso is long AVAV; Steve Grasso is long BA; Steve Grasso is long D; Steve Grasso is long FRO; Steve Grasso is long LNG; Steve Grasso is long MHY; Steve Grasso is long NUAN; Steve Grasso is long MO; Steve Grasso is long PFE; Steve Grasso is long S; Steve Grasso is long XLU; Steve Grasso is long ZAZA

For Glenn Schorr
Nomura Securities International, Inc has received compensation for non-investment banking products or services from the issuer in the past 12 months: JPM
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The U.S. equity strategist, a member of his team, or one of their household members has a long common stock position in NKE
This company/entity is, or within the past 12 months has been, a client of UBS Securities LLC, and investment banking services are being, or have been, provided.: KKS
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Jonathan Chaplin
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