Tuesday, March 18, 2014

Dennis Gartman on Doctor Copper

"We'll argue that Dr.Copper is not sending a signal to the world of impending economic weakness but is instead sending a signal to the world that the banking system in China has very real problems."

"We suspect that some banks have already called in their loans made in this manner, and that what we've seen in the past week is the first layer of that loan unwinding; however, there is no way to quantify that notion and we offer it up as it stands, without hard data. However, our fear is that the last banks in … the smaller banks; the regional banks; the banks that are always last to the feeding trough … are still holding copper collateralized loans that have gone from badly performing to horrid to now deeply under water in the matter of days. Panic liquidation has set in; the margin clerks are in charge and it is then that prices make their lows, but there is no way to tell when or where and at what prices those loans shall be finally liquidated."

story via http://www.cnbc.com/id/101488168