Prewitt: Well, can the Chinese government continue to manage the economy, the keep it growing without overheating?
Gartman: I don't think that the Chinese government has any capability, any hope - they desire to do it, but I don't think their - its even possible slightly for them to do that. I think the Chinese people seeing what the world looks like outside China for the first time in history, the advent of the internet bringing the view of better life to all of mainland China are saying I want that for my children and whether the government wants to give it to me or not, I'm going to take it.
Keene: Dennis Gartman with us, folks, the Gartman Letter. This with future's up 9, up a bit higher earlier. Dennis, we didn't do justice yesterday to Case-Shiller. It was decidedly mixed report. You got it this morning in your note as being where I was yesterday where there was just too many negative statistics there. City by city, it just hasn't been a good 90 days, has it, city by city?
Gartman: No, it hasn't been a good 90 days. And I think you have to be very careful about looking at the Case-Shiller and thinking that we were going to turn around housing prices anytime soon. I'm - it made me feel good having grown up in Northeastern Ohio that Cleveland led the nation last week, that - or last year, or last month, excuse me. That's good. But then paying too much attention to the fact that Detroit was the worst, given the fact that Detroit's housing prices have plunged by what, 90 percent or so. That tends to exacerbate or exaggerate what's going on there. I think Case-Shiller gives us a great trend, but trying to put too much credence in a monthly index of housing prices -
Keene: Right.
Gartman: all around the United States I think is a difficult, difficult task.
Prewitt: Toll Brothers came in with a quarterly loss that was bigger than Wall Street had expected this morning and they also say that Toll Brothers increased its land holding for the first time in four years -
Gartman: Yes.
Prewitt: - in anticipation in a recovery in the market. Is Toll Brothers making the right move here?
Gartman: Oh, I think Toll Brothers is probably making the right move. I think in these instances given the collapse of land prices, if you're in the business of developing, you better have some land. They bought a little too much. They liquidated over the course of the previous three years and now they're trying to put some inventory back on their balance sheets so that they have something to work with. You can't be a land - a real estate developer without land. So, honestly I think that Toll Brothers is probably doing the right thing. Are they going to pick the bottom? Will they be the one that ring the bell? I'm not sure that that's true, but I think they have no choice but to put inventory on their sheets.
Keene: Dennis, unfortunately, 30 seconds here. Are you using this pullback as an opportunity to acquire equities?
Gartman: No. No. I hope I can be that blunt. No. I would use strength with which to liquidate and get less long of equities. I would not use weakness with which to get long of them. I would get less long of them.
Keene: Dennis Gartman, thank you so much. Always with hedge trades, really intelligent trades constructed in the Gartman Letter and again, one of the great summaries here, his long gold, but against other currencies, shorting Euro and sterling at the same time, taking it away from a dollar trade. Dennis Gartman, thank you so much.
07:43
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