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Speaker 1: Dennis Gartman joins this, the retired editor of the Gartman Letter. Dennis,

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Speaker 1: you set in your notes that you quoted from T. S.

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Speaker 1: Eliott's The Waste Land about April is the cruelest month,

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Speaker 1: and you brought that to to the bulls that August

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Speaker 1: was the cruelest month. It also has a line in

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Speaker 1: it um with the Waste Land that London Bridge is

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Speaker 1: falling down, falling down, falling down. So I'm wondering, if

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Speaker 1: you're suggesting it is off to prison, you must go

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Speaker 1: for the bulls. Well, I'm not sure that it's off

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Speaker 1: to prison, but I think they've had a very hard

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Speaker 1: time over the course of the past month and a half.

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Speaker 1: And I think I've been barish of the stock marketson's

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Speaker 1: basically January five of this year, uh moving having moved

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Speaker 1: the university's endowment out about twelve its portfolio and moving

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Speaker 1: into two year notes just to protect our spending for

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Speaker 1: the next year and a half or two years, two years.

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Speaker 1: I think it's a bear market. I think it's going

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Speaker 1: to continue to be a bear market. And what bothers

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Speaker 1: me is that the rallies that we've had, and we've

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Speaker 1: had rallies along the way. We had a rally from

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Speaker 1: mid early last week until Friday after noon, and we're

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Speaker 1: opening up strongly tonight. But the volume has been on

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Speaker 1: very light volume. And usually in good bowl markets, you

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Speaker 1: see you want to see markets go up on big volume,

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Speaker 1: go down on light volume. In a bear market, you

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Speaker 1: get the absolute other way. You go down on a

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Speaker 1: larger volume and you rally on lesser volume. It's a

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Speaker 1: technical circumstances I think has prevailed for for decades, actually

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Speaker 1: probably for centuries, and it bothers me that the rallies

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Speaker 1: are doing exactly that We're having a nice rally now.

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Speaker 1: I covered. I traded mostly for my own account, and

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Speaker 1: I covered a goodly portion of my my head short

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Speaker 1: positions Monday, Tuesday and Wednesday last week. But I'm very

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Speaker 1: disconcerted that that the volume has been very light, and

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Speaker 1: I'll probably be back to being overly barish in the

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Speaker 1: not too distant future. So I think it's a bear

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Speaker 1: market that began in late December early January on the

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Speaker 1: monetary authorities are going to continue to be less than

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Speaker 1: expansionary and in fact shall be quite contractionary for a

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Speaker 1: long period of time. And I think that yes, can

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Speaker 1: you can can you quantify for us how q T

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Speaker 1: changes the game, if at all? I asked that question again,

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Speaker 1: I missed it roshot. I was asking how acreditative tightening

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Speaker 1: changes the game, if at all. Well, the FED is

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Speaker 1: going to tighten, and we know they're going to go

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Speaker 1: seventy five basis points. There's no question in the September meeting.

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Speaker 1: The only question shall be how far will they take

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Speaker 1: rates of the November and December meeting. The Fed does

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Speaker 1: not like to be grinched at Christmas time, but I

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Speaker 1: do think we're gonna go seventy basis points in September,

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Speaker 1: and a total of a hundred more basis points at

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Speaker 1: least in the November and December meetings. What's really more

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Speaker 1: important to me is the fact that the FED is

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Speaker 1: going to be running off sixty nine billion dollars from

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Speaker 1: its balance sheet over the course of the next several years.

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Speaker 1: It was that increasing in the size of its balance sheet,

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Speaker 1: taking it from nillion to nine trillion over the course

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Speaker 1: of the last decade, which was the fuel for the

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Speaker 1: bull market and the fuel for inflation. And now we're

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Speaker 1: taking that fuel away, and it's going to be years

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Speaker 1: in the making. So rather than being too focused upon

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Speaker 1: what the overnight said funds rate is going to do.

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Speaker 1: I'm far more concerned about what the FEDS balance sheet

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Speaker 1: will be doing. Okay, not looking at Dennis. You know,

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Speaker 1: the whole had monetary tightening scenario. You know, people thinking

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Speaker 1: that's going to pivot some time next year. But that's

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Speaker 1: something which you know j Palin has really tried to quah.

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Speaker 1: But does this mean that we've got multi year monetary

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Speaker 1: policy which will be a drastic departure of what we've

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Speaker 1: been witnessing in the last few years. I've said, since

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Speaker 1: I've been into business for about forty five years, the

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Speaker 1: one thing I've learned is once the FED begins to

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Speaker 1: embark upon a new direction, whether they're taking rates higher

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Speaker 1: or taking rate slower, whether they're tightening or easy, they

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Speaker 1: tend to move not for weeks, not for months, but

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Speaker 1: for months and years. So I do think that we

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Speaker 1: are in for several years of tighter monetary policy. They

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Speaker 1: have to the duty of reducing the size of their

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Speaker 1: balance sheet. Again, as I talked about earlier, it's gone

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Speaker 1: from nine billion to nine trillion. Taking sixty to ninety

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Speaker 1: billion away each month is years in the making. To

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Speaker 1: get it back to let's call it for four trillion dollars.

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Speaker 1: So this is not something that's going to happen very soon.

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Speaker 1: It's something that's going to be in with us for

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Speaker 1: I think at least two more years on the on

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Speaker 1: the tightening side. It's just something that historically has been

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Speaker 1: the precedent that the FETE has said. And given the

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Speaker 1: fact that the the doves on the committee lyle brainer

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Speaker 1: being one has now become hawkish, and even the hawks

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Speaker 1: are hawkish, this is something that's gonna be with us

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Speaker 1: for a while. So people think that there's going to

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Speaker 1: be a pivot, I think are ill advised and looking

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Speaker 1: at the wrong news. Even the doves hawk ish. Yeah,

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Speaker 1: it kind of scary, but the bond market does seem

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Speaker 1: to be sending somewhat more comforting message if you look

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Speaker 1: at five year tips for instance, down under two point

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Speaker 1: six percent. Now, the bond market could be wrong, but

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Speaker 1: it's kind of risky to call the bond market wrong.

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Speaker 1: It's a that's a pretty big market. I've always said

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Speaker 1: that the bond market is the wiser of the two

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Speaker 1: between the camp, between the stock market and the bond market.

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Speaker 1: My vote will tend to be with the bond market.

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Speaker 1: It's one of mathematics and it's one of consequence. So

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Speaker 1: if the bondom market sent wants to say that the

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Speaker 1: brakes are gonna be are going to be easy, I'll

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Speaker 1: go with that, but not right now. The trend is

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Speaker 1: from the upper left to the lower right as far

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Speaker 1: as price. The trend is from the lower left to

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Speaker 1: the up right as far as yield is concerned. And

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Speaker 1: it's been a bear market, a devastating bear market. Those

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Speaker 1: who had their portfolios in the stock versus spawn portfolio

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Speaker 1: have suffered immensely, and I don't think that that suffering

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Speaker 1: is going to end anytime soon. You give us a

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Speaker 1: sense of your strategy at the start of the interview, Dennis,

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Speaker 1: what is it looking like now? Are you feeling any

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Speaker 1: formal shape of optimism. I'm for the long term. I

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Speaker 1: did a radio interview here in todd Water, Virginia last week,

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Speaker 1: and I said, if you're looking out three to five years,

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Speaker 1: you can be optimistic. If you're looking out three to

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Speaker 1: five months or or maybe two years, I think you

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Speaker 1: have to tend to be pessimistic. So it's it's it

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Speaker 1: depends on what your time frame is. The major course

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Speaker 1: in the United States is always going to be bullish

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Speaker 1: in the long term. But I think between now and

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Speaker 1: the end of this year and into mid term next year,

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Speaker 1: I think that I think a bearer market is still

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Speaker 1: going to continue. And I think you have to be

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Speaker 1: very very conscious of the fact that it is a

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Speaker 1: bear market at this point and prices are going to

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Speaker 1: be lower, not higher. So we did see a significant

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Speaker 1: drop in commodities during the month of June, but it

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Speaker 1: really has turned around since then and and they have

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Speaker 1: started to creep higher. Admittedly, in the last ten days

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Speaker 1: we've seen another drop, but still well off the lows. Um.

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Speaker 1: You know, you made your money. I suppose as a

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Speaker 1: as a kind of commodities guru, what's the commodities market

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Speaker 1: telling you. I think wheat prices have gotten as as

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Speaker 1: probably as cheap as they're going to get what we

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Speaker 1: fell from thirteen dollars to bushel down to eight. But

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Speaker 1: getting the crop into the ground this year, the winter

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Speaker 1: wheat crop is being planted at this time, and you

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Speaker 1: need rain, and you're gonna need snow this winter. We're

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Speaker 1: not getting much rain. In the odds are getting a

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Speaker 1: massive snowfall are probably relatively minimal so I think wheat

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Speaker 1: prices want to go a lot higher. Corn prices have

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Speaker 1: stopped going down. They want to turn for the better.

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Speaker 1: Even soybean prices are turning for the better. You've seen

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Speaker 1: livestock prices, with the exception of hogs, cattle prices have

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Speaker 1: gone from the lower left to the upper right. And

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Speaker 1: what's important to me is copper has suddenly turned around

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Speaker 1: and gone to the upside. Ten seems to be turning

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Speaker 1: around and going to the upside. And even gold, which

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Speaker 1: has been under a delaterious sparer market, seems that it

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Speaker 1: seems to have stopped. So the benefits that have accrued

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Speaker 1: because of falling commodity prices over the course of the

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Speaker 1: last two and a half months, you've probably seen the

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Speaker 1: best news that you're gonna get, and you' probably gonna

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Speaker 1: see higher prices going forward. All right, let's thank you

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Speaker 1: so much for joining us this Sunday evening, of course

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Speaker 1: your time, and Monday morning right here in Hong Kong

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Speaker 1: and its Gartman their chairman of the University of acrons

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Speaker 1: in Diamond Investment Committees, also the retired editor and the

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Speaker 1: publisher of the Gartman Letter,