The oil rout is the story of the past year, here's how it ends
Dennis Gartman is a bit of a punching bag in markets due to rampant overexposure and his stilted style but he makes a great point on how major moves end.
He's talking about oil here but he could be talking about anything:
"It will end in panic liquidation," Gartman said Wednesday on CNBC. "It will end when you've had an announcement of five or six bankruptcies. It will end when mergers and acquisitions step in and take over."
He's a bit over the top but at the very least, some serious production shutdowns and layoffs will come before oil bottoms. When oil fell to $42 earlier in the year, people predicted that was coming but oil producers have been remarkably resilient.
True bottoms don't come until all the bulls have been cleaned out. Even the patient ones who only bought at severely depressed prices. It comes when people are making ridiculous predictions like $12.
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