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Get out of stocks: Gartman

The high-yield meltdown has one widely known investor spooked.

"You don't know how much worse it could be, maybe this goes away in the course of a week, but as I like to say there's never just one cockroach," Dennis Gartman of The Gartman Letter told the CNBC "Fast Money" traders on Monday. "Get out of stocks."

Historically, major recessions including 2008, were preceded by downturns in the high-yield market, but Gartman maintains that we are still in a bull market environment.

"Right now, given the Fed, given what's happening in high yield, given the trend lines that are being broken, it's a measurement to me of more uncertainty than normal," said Gartman. "It's still a bull market. And in a bull market I've always said there are three positions that one can have: really long, pleasantly long and neutral. And neutral I think is the right place to be."

Gartman suggests to get neutral by hedging any remaining positions in equities through derivative plays. But whether you get less long or completely close positions, he said the sidelines are the best place to be right now.

What concerns Gartman about the sell-off in high yield is the lack of liquidity in the market due to Dodd-Frank regulations.

"Dodd-Frank took away the option for those who could offer liquidity in times of duress — and they're not there anymore," Gartman told "Fast Money" producers. "The banks cannot take speculative positions anymore for their own account."

According to Gartman, the lack of liquidity is pushing investors to sell out of positions that they would have otherwise kept.

"You can only sell what you can sell," he said. "And sometimes that even means good investments."