Dennis Gartman
October 27, 2016

Price Is Made At The Margin: And So Too Are Elections

One of the most important rules of economics and trading is that all price is made at the margin; that is, when the last 2% of buyers become sellers, a market turns for the worse and when the last 2% of sellers become buyers, prices turn for the better. IT is for this reason that we err toward the bearish side of crude oil because the marginal buyer of crude these past several years… the Chinese buyers for the Strategic Petroleum Reserve… has now become a net seller instead.

Elections are like stock and commodity prices for where prices are made at the margin, elections… especially those here in the US… are won at the margin as the last 2% of voters shift from Republican to Democrat or vice versa. In a country where, as we have said countless times, that 52-48% is a landslide victory, those marginal voters mean something. Why then, we ask, has Mr. Trump sent the message to his potential marginal voters that the election is rigged; that their votes will in the end not count; that the Left has won the election before the process has begun and that the election shall be stolen from them? What sort of signals does that send to the “marginal” potential Trump supporter to go to the polls and vote?

We have not been supporters of Mr. Trump from the very beginning; seeing him as boorish and knowing that he is a right-of-center Republican in name only as he supports trade protection and is openly anti-immigration. But we stand speechless and astonished at his constant haranguing that the election is rigged, which shall only disillusion his supporters at the margin and keep them from the polls when they are needed the most. Can anyone, anywhere, explain the rationale that he’s employed in this instance, for certainly we cannot.






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