Investment guru gives his take on the developments in financial markets in general and commodity markets in particular.

Dennis Gartman is the man behind The Gartman Letter, a daily newsletter discussing global capital markets. For more than 20 years, The Gartman Letter has tackled the political, economic and social trends shaping the world’s markets, and Gartman himself is a frequent guest on CNBC, Bloomberg and other financial media outlets. Hard Assets Investor’s Sumit Roy recently caught up with Gartman to discuss a wide range of topics, including gold, oil, natural gas, housing and China.

HardAssetsInvestor: Is the crisis in Cyprus significant for the global economy?

Dennis Gartman: It is significant for the psychology of investors. I think it’s significant for the psychology of wealthy families. I think it’s significant for people outside the United States to worry about the sanctity of contract and to worry about the sanctity of bank deposits. It adds a real concern to whether your money is indeed safe. Now it doesn’t mean that things are going to fall apart. It doesn’t mean that the world is coming to an end. But it does mean that you have an added concern that you have to add to the many other concerns that one has when making investment decisions.

At the margin, you have to suspect that wealthy families and wealthy corporations have had meetings to say “Look, the game changed a good deal … what do we have to do to protect ourselves?”

And as I like to say—since all economics is the study of people’s propensity to do something—what is the propensity for an investor from outside of Europe to put money into Europe? I have to suspect that that has been somewhat reduced. What is the propensity of somebody from inside Europe to move money outside of Europe? I have to think that that propensity has been somewhat increased. 

In the long run, the Cyprus situation is bearish of the euro. I think in the long run, it’s bullish of dollars—U.S., Canadian, Australian and Kiwi dollars. On other hand, I’m not quite convinced that it is either bullish or bearish of the stock markets.

HAI: Back in May, before the announced QE3, you made the call that gold had put in its short-term low below $1600. Of course, that proved to be very accurate, as gold rallied all the way up to $1800. Now we find gold back near $1600 again. What do you think is going to happen this time?

Gartman: I’m very bullish on gold, but not in dollar terms. I could care less, to be honest, about gold in dollar terms. I have immense interest in gold in yen. And it’s hard for people to believe that gold denominated in yen is at a new all-time high. Nobody recognizes that fact. But gold in yen terms is at a new high.

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