Investment guru Dennis Gartman says we’re not going through a garden variety correction in the stock market and recommends that investors sell.
Every market around the world has begun to falter, says the editor of The Gartman Letter.
“That’s disconcerting,” he told Bloomberg.
“I think there’s something more serious than just a 7 to 10 percent decline going on. You’ve had a nice run. . . . Don’t be surprised if stock prices are down another 10-15 percent by the end of summer.”
Gartman says the sovereign debt crisis in Europe has dented market confidence.
“For the first time in a long while, you have to real concerns about the efficacy of the European Union,” he said.
“Greece is a marginal player. This isn’t Germany or France. But if Greece is showing these problems, we know that Portugal is behind them, and Spain is behind that, and Italy is behind that.”
Can all those countries be bailed out?
“I think not,” Gartman said.
So what should investors do?
While shorting stocks is difficult for individual investors, “If you’re aggressively long of stocks, you should be dramatically less long,” Gartman said.
Not everyone sees Europe’s woes as significant for U.S. stocks.
What investors have to do is assess which stocks suffer for no reason.
“That’s about 90 percent of the market,” CNBC commentator Jim Cramer said on the air.
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