Dennis Gartman: Beginning of Bear Market
Dennis Gartman made headlines Monday after saying odds of additional QE was 100%. And now, on CNBC’s Fast Money, he explains why and how to position for it.
Gartman, who is a widely followed commodity investor and CNBC Contributor, believes that economies of the world are far worse than many investors understand.
“I fear we’re heading into a recession and I think Europe is past recession heading into something far worse than that,” he says. “I suspect, our Fed as well as the ECB and other central banks around the world will have to be out in front and demonstrate concern over what’s going on.”
Hence Gartman’s headline making call that the chances of additional QE are now 100%.
Gartman expects the Fed to extend Operation Twist and he thinks it happens before the FOMC meeting in July.
But will it have a bullish effect on the stock market? Gartman says, “Probably not. The fact that they need to do it alone is very disturbing."
“Sadly I think we’re heading into a bear market. The environment sets up well for gold . I’d go long gold and short stocks,” Gartman counsels.
> Wall Street History: Why Are Pessimists Called Bears?
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Posted by CNBC's Lee Brodie
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Trader disclosure: On June 4, 2012, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Karen Finerman is long AAPL; Karen Finerman is long JPM; Karen Finerman is long BAC; Karen Finerman is long WMT; Karen Finerman is long TGT; Karen Finerman is long RIMM; Karen Finerman is long GRPN PUTS AND PUT SPREADS; Karen Finerman is short SPY; Karen Finerman is short IWM; Karen Finerman is short MDY; Tim Seymour is long BAC; Tim Seymour is long INTC; Dan Nathan is long AAPL JUNE 550/520 Put Spread; Dan Nathan is long BAC JULY 6/5 PUT SPREAD; Dan Nathan is long MS JAN 10/5 1X2 PUT SPREAD; Dan Nathan is long RIMM JAN 20/25 CALL SPREAD; Dan Nathan is long CHK JAN 12.50/7.50 PUT SPREAD; Dan Nathan is long CHK JAN 10/5 1X2 PUT SPREAD; Guy Adami is long C; Guy Adami is long GS; Guy Adami is long INTC; Guy Adami is long AGU; Guy Adami is long MSFT; Guy Adami is long NUE; Guy Adami is long BTU
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