Dennis Gartman Idiotically Insults Buffett

I have long held the view that a person’s judgment or criticism is more a reflection of that person than it is a reflection on the subject being criticized. My jury on Dennis Gartman, of The Gartman Letter and CNBC/Bloomberg fame, had been out until this piece on the Wall Street Journal website:

Gartman: Warren Buffett Is An Idiot

Gartman is more of a trader than fits my style but he has sounded fairly reasonable in media appearances. But then he started popping up regularly on CNBC’s Fast Money show, which suggests he’s more of a self-promoter than a serious thinker. In any case, his insult of Buffett is completely asinine and reflects poorly on Gartman.

Apparently, his main beef with Buffett is Buffett’s adherence to buy-and-hold, which as we all know by now is obsolete and dead (yes, that was supposed to be sarcastic). Gartman also has a short call on Berkshire but really, this is unrelated to Warren Buffett’s alleged idiocy unless Gartman is shorting it due to management incompetence (history suggests otherwise). The article then goes on to reveal that Gartman is wrong on two-thirds of his trades. Yes, that means Gartman is wrong 66% of the time! He says he still makes money ostensibly by cutting losses quickly and letting winners ride.

I find a slogan from my old computer programming days helpful in the debate between investing vs. trading: when it comes to making money, there’s more than one way to do it. So really, the issue of buy-and-hold vs momentum trading is a moot question. The true question is which style suits your personality. The better your investment strategy suits your character, the more likely you are to maintain the  discipline needed to generate good results. None other than the idiot (savant) himself, Warren Buffett, holds that the key to investment success is knowing yourself.

Personally, I find my temperament takes quite well to a value investing philosophy. It speaks to my strong points such as a curious, analytical mind and a propensity towards frugality. Ever since childhood, I drove people batty with my neverending questions and I hate paying full price for anything. It also addresses my weak points like impatience and an impulsive streak. Following a value discipline slows me down and forces me out of rash decisions. In a way, value investing is almost boring. As Buffett puts it, I spend most of the time with the bat on my shoulder and that’s a good thing — I couldn’t handle the constant being on edge that would go along with trading.

But that’s my path. It may not be yours. As always, YMMV.

4 Responses to “Dennis Gartman Idiotically Insults Buffett”

  1. BP Says:

    What we have here is a failure to communicate…

    The problem being that the WSJ blog doesn’t tell the whole story. Gartman is not naked short Berkshire, he’s short it against Loews (L – the holding company not the home improvement co.), his reason being that BRK trades at a much larger premium to its portfolio holdings than does L (he might be long GS also as part of the trade, but I can’t recall). As for the Buffett is an idiot line, he’s clearly being tongue and cheek, and rightly figured that WSJ would feature that prominently.

    I happen to read Gartman daily, even though I’m primarily an equities guy, and I find him to be pretty well thought out. Sure more into technical than I, but then again he’s much more active in FX and commodities, which perhaps lends itself to that more so.

    Either way, I’ve been tracking his “short Berkshire” trade, and he’s been pretty clear this has nothing to do with overvaluation, Buffett losing it, Buffett being old and it getting crushed when he dies…ti’s merely a relative value trade.


  2. Davy Bui Says:

    BP, thanks for fleshing out the story a bit.

    I don’t have a problem with his shorting Berkshire. I am hesitant to go long BRK due to reasons of my own (primarily, key man risk and Buffett’s reticence to publicly begin the succession process).

    I’ve always thought Loews was an interesting case but decided I’d rather just own DO &/or LO than L (I don’t own any of the 3).

    As for him being tongue-in-cheek, what was the point? I know we live in a world where even bad publicity is good and I would understand if he was a tweener pop star who didn’t like to wear underwear in public. Is Gartman angling for the Bad Boy of Investment Newsletters mantle?

  3. William Says:

    You obviously don’t subscribe to his newsletter and so don’t really understand what his investment thesis is. Instead, you make goofy statements. My one and only visit to your amateur blog. Good bye.

  4. Davy Bui Says:

    Gartman calls Buffett an idiot and you think I’m the one making goofy statements?

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