Merryn Talks Money

GMO's Jeremy Grantham Warns US Stocks Are About to Be Crushed

55 snips
Feb 28, 2025
Jeremy Grantham, co-founder of GMO and a legendary market strategist, discusses the looming dangers of a current 'super bubble' in the U.S. stock market. With over five decades of experience, he predicts imminent corrections and shares concerns about the green transition and its ties to economic health. Grantham also tackles the implications of declining population growth on productivity and advocates for a shift in cultural values. He delves into the speculative nature of assets like gold and Bitcoin, calling for a re-evaluation of traditional economic models in light of environmental sustainability.
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INSIGHT

US Stock Market Super Bubble

  • US stock market valuations remain excessively high, resembling a super bubble.
  • Traditional value measures like Schiller PE and Buffett's market cap to GDP are at record levels.
INSIGHT

AI and Market Bubbles

  • The transformative impact of AI, while significant, doesn't justify current market valuations.
  • Historical parallels like railroads and the internet demonstrate that groundbreaking technologies often lead to bubbles.
ANECDOTE

Amazon's Dot-Com Drop

  • After the dot-com bubble burst, Amazon's stock plummeted by 92%.
  • It then recovered and became a dominant force, highlighting the volatile nature of tech bubbles.
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