Jeremy Grantham has a good record when it comes to big calls. The co-founder of investment managers GMO not only warned that the housing bubble of the 2000s would burst, but also turned positive on US stocks just as they bottomed in March 2009. He has also said that he expects this central-bank-induced rally to "end badly". But he doesn't think this year's ructions mark the beginning of the end. This, he says, "feels at worst like an ordinary bear market lasting a few months, and not like a major collapse".
In short, this is not the sort of backdrop usually associated with nasty collapses. But another reason to think that this is not the "Big One" is the absence of "a fully fledged blow-off". The last market peak in 2007 was marked by an overstretched economy and a frenzy amid individual investors. A real market top comes with "crazy speculative anecdotes for your grandchildren". This rally isn't over yet.
MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
-
Defeat into victory: the key to Simon Wolfson's successOpinion Next CEO Simon Wolfson claims he owes his success to a book on military strategy in World War II. What lessons does it hold, and how did he apply them to Next?
-
Aircraft leasing companies can lift investors' portfoliosThe aircraft leasing business is a safer way to cash in on air travel and its booming demand. David Prosser explains how it works and how to access it
