Jeremy Grantham of GMO had some good macro thoughts on the markets over the weekend in Barrons. To summarize his views:
- The Greenspan-Bernanke-Yellen Put is well in place and driving irrational sentiment.
- The bullishness at present is driven primarily by institutional investors.
- US stocks are “65% overpriced.”
- US stocks won’t be in a “true bubble” until they’re 100% overpriced.
- GMO’s 7 year forecast continues to call for poor equity market returns.
- GMO has an equity weighting that “will be down to about 38%” by October if nothing changes this year.
- Bonds of all types are much riskier in this environment than many think.
Read the full piece here.