We Study Billionaires - The Investor’s Podcast Network

TIP371: The Top of the Cycle w/ Jeremy Grantham

4 snips
Aug 20, 2021
In this conversation with Jeremy Grantham, co-founder of GMO and legendary investor, he shares his insights on recognizing market bubbles and preparing for inevitable corrections. He critiques the Federal Reserve's track record in managing economic downturns while discussing the potential of green venture capital to address environmental issues and provide investment opportunities. Grantham emphasizes the precarious state of the current financial landscape, along with strategies for navigating future market challenges.
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INSIGHT

Identifying Bubbles

  • Market bubbles are identified by accelerated growth, high prices, and crazy behavior.
  • Examples include meme stocks, high individual participation, and massive trading volumes.
ANECDOTE

Japan's 1989 Bubble

  • Japan's 1989 bubble saw stocks reach 65 times earnings, impacting their economy for decades.
  • Real estate, an even bigger bubble, remains below 1989 levels after 32 years.
INSIGHT

Everything Bubble

  • The current market is unique with simultaneous bubbles in bonds, US equities, and housing.
  • Global housing markets and commodities add to this risk, creating an "everything bubble."
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