In his latest quarterly letter, GMO’s Jeremy Grantham offers some very interesting data on the disconnect between the stock market on one hand, and the economy and “fair value” of the stock market on the other. “This difference is massive — two-thirds of the time annual GDP growth and annual change in the fair value [...]
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Tag Archives: Jeremy Grantham
Grantham: Investment Outlook “Not Bad At All”
March 1, 2012
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GMO’s Jeremy Grantham has released his fourth-quarter letter, and, while the often-gloomy strategist focuses a good deal on the troubling flaws of the existing capitalist system, his investing outlook paints a fairly attractive picture. “The majority of global equities are within spitting distance (a technical term) of fair value,” Grantham writes. “Only the S&P 500 [...]
Read moreGrantham’s Firm Sees “Mother of All Bubbles” in China
February 17, 2012
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Jeremy Grantham’s firm is taking a very bearish stance on China, believing the country is in a huge infrastructure and real estate bubble. “China is experiencing the mother of all bubbles,” Peter Chiappinelli, portfolio strategist at Grantham’s GMO, says, according to InvestmentNews.com. “We don’t know when it’s going to pop or what’s going to cause [...]
Read moreGMO High on Quality & Value, Sour on Bonds
February 10, 2012
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Jeremy Grantham’s GMO has published its fourth-quarter update, offering a contrarian position on Europe and outlining its strategies as we head into 2012. The firm says it moved “incrementally into Europe” in the fourth quarter of 2011, adding. “Selectively, slowly, prudently, of course, but the general belief is that markets have overreacted, and this always [...]
Read moreIs There A Hole In The CAPE?
February 2, 2012
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While some prominent strategists, including Jeremy Grantham and Robert Shiller, have pointed to the 10-year cyclically-adjusted price/earnings ratio (“CAPE”) as evidence that stocks (in particular the S&P 500) are very overvalued, Wharton Professor Jeremy Siegel says there’s a flaw in the metric. The flaw, Siegel said at a TD Ameritrade Institutional conference, involves the 2008 year, [...]
Read moreGrantham’s GMO Not As Gloomy On Stocks As You Think
December 30, 2011
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While Jeremy Grantham’s GMO has been gloomy about the outlook on stocks, the firm’s head of asset allocation says there are also good opportunities in the market right now. “We think there is money to be made,” Ben Inker tells The Boston Globe. “There’s plenty of stuff to be worried about. [But] there’s actually a [...]
Read moreThe Gurus Dig Deep For Resource Plays
December 12, 2011
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In his latest article for Nasdaq.com, Validea CEO John Reese takes a look at some natural resource-related stocks that look attractive right now. “With the world population continuing to rise, global economies running for the most part on non-renewable resources, and central banks injecting huge sums of money into the financial system in recent years, [...]
Read moreGrantham Gloomy, But Not Running From Equities
December 6, 2011
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GMO’s Jeremy Grantham sounds quite gloomy in his latest quarterly letter, though he advises a “near normal” allocation to equities and says high-quality U.S. stocks are “relatively cheap”. Grantham says that both debt overhangs and structural problems — such as income inequality, an aging population, deficiencies in infrastructure and education, and the government’s inability to [...]
Read moreGrantham, Doll Offer Different Takes On Margins
November 29, 2011
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Are historically high profit margins for U.S. firms sustainable, or will they come bouncing back to the mean — and throw a wrench into the stock market in the process? Blackrock’s Bob Doll and GMO’s Jeremy Grantham have very different takes, according to Bloomberg. Doll says a weak job market and labor-saving technologies have helped [...]
Read moreGrantham Gloomy, But Finding Value
September 21, 2011
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GMO’s Jeremy Grantham is predicting more gloom for the U.S. economy, but he says stock valuations are “finally” such that investors can build portfolios of equities with potential for solid long-term returns. “If we adjust earnings to normal and apply an average P/E, you can finally build a decent portfolio today of global equities at [...]
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