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The central thesis of gold bugs - that the Fed has lost control of the money supply - is now "in...

The central thesis of gold bugs - that the Fed has lost control of the money supply - is now "in tatters," writes Dennis Gartman. The bulls only hope is a more dovish FOMC in 2013. It may be so at the margin, but not materially so, he says. Gold -1.8%, but - as they say - off the lows.
Comments (24)
  • Just what does it mean to "own gold in euro terms"?? Does that mean that Mr. Gartman has borrowed euros to buy his gold? ie, he is taking a short euro position along with his long gold position?
    4 Jan 2013, 10:44 AM Reply Like
  • Yes - I think he means short Euro/Long gold. mr. Gartman tends to be a very short term trader and is good at "explaining" what has already happened! So, gold has been very weak for the past couple of months and he now believes the whole thesis is in "tatters". If , for whatever reason, gold shoots up, he will no doubt say something like the central bank is in "tatters'!
    4 Jan 2013, 10:50 AM Reply Like
  • 100% agree. Gartman has 20/20 hindsight -- but no foresight. He is similar to CNBC's Cramer who has the obnoxious habit of saying "Told ya" no matter which way the markets goes.
    4 Jan 2013, 12:46 PM Reply Like
  • That's not Cramer's only obnoxious habit. Don't get me started!
    4 Jan 2013, 08:33 PM Reply Like
  • I donĀ“t think anything has changed....either in the USA or in Europe...
    4 Jan 2013, 10:59 AM Reply Like
  • Following Gartman is similar to reading last weeks Sunday paper. The central thesis of currency debasement is not in tatters but has only been modestly headline challenged.
    4 Jan 2013, 11:00 AM Reply Like
  • I was at an investment conference in Chicago a few years ago and Gartman was the speaker. He told the story about his career in giving advice and readily admits he is "wrong 80% of the time." So I take his predictions with a grain of salt.


    That said, he gets out of the trade if it goes against him, and lets his winners ride. Kind of nice to get paid $5,000 a year for his Newsletter and be wrong 80% of the time! CNBC sure likes him for this success ratio. But I imagine his clients do fine by his admitting he is wrong and suffering some losses to take advantage of the 20% of the time he is right.


    I wrote an article on this back in March of 2010 called "Dennis Gartman Flip Flopping On Gold and U.S. Dollar"


    He has flip flopped on the buying gold in Euros over the past few years too, moving in and out of the trade.
    4 Jan 2013, 11:02 AM Reply Like
  • He should be a weatherman they get paid better for being wrong.
    4 Jan 2013, 12:19 PM Reply Like
  • Gartman changes his views on gold every time the wind blows. To say the FOMC is becoming more hawkish is to misinterpret the minutes. Two new dove members coming on soon. Hawks are the same old ones. Kudlow had a good take on this last night, actually.


    To say "some members expressed" was just a nice way of not calling anyone out. But nothing has really changed. The poor choice of words caused an over reaction. Am guessing the person who crafted the minutes was a different and less experienced staff person who was filling in for a more seasoned expert due to the holidays. Of course they (The Fed) don't mind making statements to tail spin gold. However they like to protect equity prices as much as they can. So I am thinking they were a bit careless with their specific language. Too much eggnog.


    Actually those minutes managed to sneak up on me. Embarrasing but true. That's where the amateur DIY trader like me gets clobbered sometimes. Stupid feeling. I really need a more complete timeline of dates and events that can affect the various few assets that I trade. I try not to trade too frequently. I try to make the best plays and most well thought out strategy I can. Save my powder for just the best opportunities. But get even a little careless and any trade will just blow up.


    I have an idea for automating this information along a time line and tying it back into comments and articles providing a forecast of the outcome of that event and the expected impact on market price.
    4 Jan 2013, 12:27 PM Reply Like
  • One has to either be a short term trader or an investor. Successful short term trading requires following technicals, price charts etc and having tight stops etc. Fundamentals are pretty much irrelevant other than to have something interesting to say on TV.,
    4 Jan 2013, 11:10 AM Reply Like
  • I'm NOT a trader, anymore. I bought more physical, this morning at 1635, only regret is that I have to keep cash on hand for taxes or I would have bought more. All I know is that the end of the PetroDollar, dollar and treasury dumping and the start of hyperinflation are closer than most think. On a GAAP basis we have been having 5 TRILLION deficits for years and running 7 TRILLION/yr now. The Fed is buying most of the Treasuries to keep the banks from failing due to the massive derivative time bomb/hot potato floating around (worth several times GLOBAL GDP) and the banksters are allowed to value the sh*t on their books at whatever they like, MANY other countries have adopted QE to infinity as well......... So the fiat money system recovers and everything is fine and gold is simply a barbaric relic ??? I'm too old to play "musical chairs" with my wealth anymore.
    4 Jan 2013, 11:15 AM Reply Like
  • this is the most bullish thing for gold ever.
    4 Jan 2013, 01:33 PM Reply Like
  • Investing in gold is simple. Examine the fundamentals, conduct "due diligence" and go long, or short, as the fundamentals suggest. In the current environment: 1. The Fed is printing money at an alarming rate; 2) As a consequence the dollar is being devalued; 3) At some point (within the next 24 months) inflation will kick in with a vengeance; 4) The dollar will plunge to new lows; 5) gold will rise to new highs. In short, paper money will become worthless and gold, with its intrinsic value, will surge! Note: The same can be said for silver!
    4 Jan 2013, 01:34 PM Reply Like
  • Sorry but the bit in the Fed statement that they are gonna end QE3 or QE4 or QEx is so much nonsense.


    Does any sane person really expect the Fed to put away the printing press before Inflation actually goes nuts and by then it will be way to late. So, Gartman is wrong - the Fed has already lost control of the money supply -
    4 Jan 2013, 01:35 PM Reply Like
  • My comment is HELP! I am a new invester in gold, via PHYS at the advice of my adviser. My intuition when Obama was re-elected waas that the economy could only get worse..much worse re the dollar.


    Unfortunately, I didn't buy when PHYS was at $12 or so, but got in at $14.78 only to see it quickly drop to $14.02, then after several days back up to $ 14.35, now (yesterday) back to $14.21.


    I admit I'm a navist, so when I saw the invitation to hear what you professionals have to say about it, I'm all ears.


    I'm 80, trying to protect my wealth to leave to my children and grandchildren, my church, and a Middle East Ministry called Leading the Way.


    What next do you think?
    4 Jan 2013, 01:35 PM Reply Like
  • I think you should take actual, physical delivery of your metals, or maybe you prefer a piece of paper that says you are entitled to some metals ?
    4 Jan 2013, 02:46 PM Reply Like
  • If you own it now hang in there. PHYS is good way to play PM' s. Good luck
    4 Jan 2013, 03:51 PM Reply Like
  • Don't watch it on a daily basis, you will go nuts. Check back in maybe every 3-4 months and see out the roller coaster ride PHYS took in that time, but it should be up from the start point, maybe a little, maybe a lot. Watching on a daily basis will give you a heart attack and the kids will get their inheritance too soon...
    4 Jan 2013, 04:11 PM Reply Like
  • I don't know if you read his articles but Matts are very good. It's all technical analysis but easy to read and understandable. It will help you understand market moves and pick entry points. Here's the link
    4 Jan 2013, 09:28 PM Reply Like
  • From 1793 to 1933, or 140 years, you could go into any bank in America and exchange a paper twenty dollar note for a twenty dollar gold piece, containing almost a troy ounce of gold. Then, Franklin Roosevelt started the Great Currency Debasement which continues today; it now takes 83 of those twenty dollar notes to buy the same ounce of gold.
    The central banks are printing money as fast as they can, and the gold mining companies are struggling to grow the world's gold supply by even 2% a year, travelling to the ends of the earth to mine ore with as little as 1/2 gram of gold per ton of rock!
    For a little history on currency debasement, and for some ideas on how the endgame of the current currency fiasco might play out, read the book, "The Currency Wars" by James Rickards. Highly recommended. They have it at my local library; check yours!
    4 Jan 2013, 02:33 PM Reply Like
  • The fed can't stop printing money now and buying treasuries or it will all collapse very quickly. Any other view is pure fantasy. This is nothing more than a buying opportunity. They will try to inflate themselves out of their unpayable debt.
    4 Jan 2013, 02:39 PM Reply Like
  • Exactly, there can be no other outcome. For a serious explanation see John Williams at
    4 Jan 2013, 02:50 PM Reply Like
  • The real problem is that at some point money printing causes interest rates (swap rates, actually) to turn up. At that point, the die is cast and debt service becomes increasingly expensive, consuming an ever larger portion of revenues. Eventually, default is the only option. Latin America offers plenty examples, but so does Europe without needing to go further back than a single century.
    Sovereign defaults are a much better reason for purchasing gold than the simple fear of inflation.
    4 Jan 2013, 05:00 PM Reply Like
  • Gartman what happened~?
    18 Jan 2013, 05:57 AM Reply Like
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