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Bubble expert Jeremy Grantham addresses ‘epic’ equities euphoria

Bloomberg/John Authers interviews Jeremy Grantham

Repost from 6-25-2021

grphic image of a bandwagon pulling investors aboard

“This current event is particularly dangerous because bonds, stocks and real estate are all inflated together. Even commodities have surged. That perfecta and a half has never happened before, anywhere. The closest was Japan in 1989 with two hyper-inflated asset categories: record land and real estate, worse than the South Sea bubble, together with record P/E’s in stocks recorded at the time as 65x. The consequences for the economy were dire, and neither land nor stocks have yet returned to their 1989 peaks!”

USAGOLD note: An important interview conducted by an interviewer who has an acute sense of the financial markets, and an interviewee with a reputation for accurately calling Wall Street crashes. Grantham concludes that “asset allocation is particularly difficult today, with all major asset classes overpriced.” lAuthers suggests that cash “isn’t just there as a lead weight in a portfolio. It obviously gives you no kind of decent return at present, but it does have value in its optionality.” Returning once more to the possibility of rapid currency debasment (Please see below.), it might be useful to hold both kinds of cash – green and gold.


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