- Jeremy Grantham expects stocks to fall sharply before the market bottoms out.
- GMO co-founder warns US multi-asset bubble is very dangerous
- Grantham panned Bitcoin, accused the Fed, and said Tesla shares reached a “ridiculous price” in January.
A veteran investor, market historian and co-founder of GMO, he also joined the Federal Reserve Board (Fed) to warn against betting on commodities, saying: praised. Tesla However, it mocked its highest valuation during an interview.
Below are Grantham’s ten best quotes, lightly edited for length and clarity.
1. “Nothing is quicker and more spectacular than a bear market rally. In hindsight, they meant little. Gives us hope that we’ll be back in the race.” (Grantham suggested the current stock rally could continue into September.)
2. “It’s unusual for a bear market to bottom out near this high. By the low, we expect the S&P to have effectively fallen 50% from its peak.”
3. “I don’t put classic FANG in the hyper-speculative category. I think you could put Tesla in its prime. (Elon Musk’s electric car company surpassed $1.2 trillion in market cap in January.)
4. “In a bull market, it’s hard to mentally understand what’s going to happen in a bear market. Amazonwas down 92% in the 2000 burst and sales increased — a brilliantly successful new idea owns the world and is worth big bucks. “
5. “As we have seen, bitcoin is not a good value reserve. The fact that it robs us of precious energy and emits carbon dioxide is the worst crime, and the sooner it goes away, the better.”
6. “As a speculative tool, hundreds of early riches made a lot of money. We know.It’s the same old, same old ‘rich get richer and poor get poorer’ so an attempt to spin this as an equalizer is just that, pure spin. (Even Bitcoin.)
7. “It’s dangerous to get caught in a bubble that mixes multiple asset classes: bonds, housing, equities, commodities. Bubbles put more pressure on the recession drivers. Playing with fire this time.” (Grantham says Japan faced a multi-asset bubble in 1989 and its stock and housing markets have yet to recover.)
8. “I think the Fed has been pushed into a recession and is leaning towards optimism. Hmm, if I was told to take a bet, ‘Will the Federal Reserve get inflation wrong when it happens?’ It would be delayed, their reaction would be pretty badly judged.” The Federal Reserve’s record is terrible. “
9. “The world would be a much better place if we had moderately high interest rates. We could get money from savings, people would speculate and leverage less, and the system would be less risky. Yes, I can afford to buy a house at a low price and I can afford to buy stocks and build my portfolio.”
10. “Value managers always hate commodities. They are as unpredictable as anything on earth. Going short kills thousands. Going long is just as bad.” I certainly don’t think so, please encourage people to go short on metal.If you can go long and ditch the key, I think that will do the trick.It takes nerves of steel.
read more: The more worried Wall Street is, the more bullish it gets, says the head of investment at BMO Capital Markets. Here’s why he thinks there won’t be a recession, and his team’s 30 best investment ideas.