Wednesday, June 17, 2020

Grantham is bearish

Jeremy Grantham, the longtime investor who called the financial crisis, told CNBC’s “Closing Bell”  that this U.S. stock market rebound amid the coronavirus may be the fourth major market bubble he’s seen in his lifetime. He advises investors to take their U.S. exposure to zero. “The U.S. is simply now playing with fire. You might make a lot of money in a really short time but recognize we are skating on very thin ice,” said Grantham.

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Investor Jeremy Grantham is growing more and more sure that the U.S. stock market’s rebound amid the coronavirus pandemic is forming a bubble that is ignoring reality and will end up hurting many people.

 “My confidence is rising quite rapidly that this is the fourth ‘Real McCoys’ bubble of my investment career,” Grantham, co-founder of GMO, told CNBC’s Wilfred Frost on Wednesday in an interview which aired on “Closing Bell.” “The great bubbles can go on for a long time and inflict a lot of pain.”

The previous three bubbles Grantham referred to were Japan in 1989, the tech bubble in 2000 and the housing crisis of 2008.

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