Jeremy Grantham: Avoid bonds and stick to quality stocks

Jeremy Grantham is gloomy about the world's, and particularly America's, growth prospects.

Jeremy Grantham has plenty of reasons to feel happy. After all, his investment firm GMO has enjoyed a good year, with its largest share fund up almost 10%. Moreover, many of Grantham's personal predictions, such as a short-term dip in commodity prices, have been borne out. But he's worried. The British-born US-based investor is gloomy about the world's, and particularly America's, growth prospects.

His view that Europe is in a "terrifying situation", won't come as a surprise to his followers, and is shared by many mainstream pundits. But his pessimism on America, where recent positive economic news has nurtured hopes of a revival, is striking.

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James McKeigue

James graduated from Keele University with a BA (Hons) in English literature and history, and has a certificate in journalism from the NCTJ. James has worked as a freelance journalist in various Latin American countries.He also had a spell at ITV, as welll as wring for Television Business International and covering the European equity markets for the Forbes.com London bureau. James has travelled extensively in emerging markets, reporting for international energy magazines such as Oil and Gas Investor, and institutional publications such as the Commonwealth Business Environment Report. He is currently the managing editor of LatAm INVESTOR, the UK's only Latin American finance magazine.