Jeremy Grantham said US stocks are heroically overvalued, copper is expected to rise and it has suffered a “super-preferred” lockdown in a recent interview. Here are the 14 best quotes.
Legendary investor Jeremy Grantham said US stocks are extremely overvalued, copper prices are expected to rise in the coming years and that he has a “super-preferred” foreclosure in an interview with Morningstar Investment Conference Australia this week.
The co-founder of asset management firm GMO has also torn up the big oil companies, saying they are too cynical to engage with. And the 82-year-old said the PSPC and Nasdaq boom has likely peaked.
Here are the 14 best quotes from the interview.
On the investment landscape
1. “The developed world is just overvalued, that’s okay in itself, but the US is heroically overvalued and the emerging markets are actually pretty cheap … would get a really nice 10 or 20 year return . And I’m pretty darn convinced that you’re not going to get a nice 10-year return, say from the S&P 500 or the Nasdaq. “
2. “[The] By the way, the Nasdaq peaked quite a long time ago, two months ago … This time I guess super SPACs peaked in January, Nasdaq peaked in February. And maybe in a few months the termites will hit the rest of the market. “
3. “Crazy people really have something to do with electrification. Electric vehicles, for sure, Tesla is the king of this group, [and] they are down 30%. The SPAC index is down 30%, the last 10 PSPCs to have announced a deal are now [trading at] less than the $ 10 they make these transactions. “
4. “It is impossible that copper does not increase enormously from here because of the electrification of everything. And that goes for cobalt, it goes for lithium. And all metals except iron and aluminum. are really rare… It is necessary to reconcile in the long term for a world different from the prices of raw materials.
On the dangers for the markets
5. “The higher the price of an asset, the lower the return. So having high priced assets is great for retirees, seniors like me who sell my assets. means you build up your wealth more slowly… So I welcome the drop in asset prices, which I’m sure will come. “
6. “It won’t take bad news. It won’t take a completely bad economy to start pushing this market down. It will take a perfectly good economy and a perfectly optimistic outlook, but a little less than a week ago. a month. ” – Grantham also spoke of “pessimistic termites” that would start to undermine investor confidence.
7. “You look around and see that real estate is suddenly quite sparkling in almost every interesting market in the world… You can’t hold on to an asset class like housing, where the house doesn’t change, and you’re just grossing it up in real terms year after year. Eventually there will be a day of judgment. “
8. “Don’t shoot Japan. Japan had the biggest land and real estate bubble in history, bigger than the South Sea bubble in my opinion. It also had the largest equity bubble of any advanced country. [Now] 32 years later, their land has not returned to what it was in 1989 and their stock market has not returned in nominal dollars to what it was in 1989. And this is a perfect example, because the higher you go, the longer and more important the fall. “
9. “We have had a totally super-privileged existence. We are in beautiful countryside with 50 acres of forest to us … And I did a lot more research than usual because I wasn’t wasting my time in the fields. So my carbon footprint was wonderful, and I was reduced to worrying about little things like writing off my stock of ties. If I could wear three at a time, I would. “
On the oil companies
10. “The oil industry has waged a deliberate campaign of obscuration, political propaganda, to deliberately deceive the world… It should be criminal. It certainly had a very damaging effect… It cost the world maybe up to to 10 years of progress on climate change action and government support and sensible regulation. “
11. “I think the commitment to routine worries [with companies over climate change] is the way forward… But with the oil companies, I think they’re just too cynical and too smart for engagement to matter. “
On value investing and risk capital
12. “[Value investing] had 11 brutal years. It was the 10 worst years in history for value versus growth. And then last year was by far the worst year. So you’ve had the worst decade followed by the worst single year… We’ve had a lot of problems over the past 11 years. “
13. “American capitalism seems outdated to me, a little fat and cheerful, not aggressive enough. Only half of the people work for companies. [that are] one and two years than there were in 1975. So we are losing some of our dynamism. “
14. “But there is one thing where the United States is still exceptional and that is capital risk. And venture capital really attracts the best these days. They don’t go to Goldman Sachs to write algorithms. They’re going into venture capital or starting a new business, and they should. “