Guru watch: no bubble in US stocks, says Jeremy Grantham

Jeremy Grantham, the co-founder of GMO, has concluded that “despite brutal and widespread asset overpricing”, US stocks haven’t quite reached bubble territory.

Jeremy Grantham has a reputation as one of the investment world's best forecasters. The co-founder of GMO, which manages more than $120bn, was alert to the housing bubble "a train wreck in very slow motion", he called it and also pinpointed the turn of the US stockmarket in March 2009.

Having spent much of his time studying bubbles, he has concluded that "despite brutal and widespread asset overpricing", US stocks haven't quite reached bubble territory; that would imply a level of around 2,300 in the S&P 500 index. And while he believes that this central-bank-induced market rebound looks due for a substantial fall in the next few years, for now he expects "it will hang in or better at least through the election".

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Dr Matthew Partridge
Shares editor, MoneyWeek

Matthew graduated from the University of Durham in 2004; he then gained an MSc, followed by a PhD at the London School of Economics.

He has previously written for a wide range of publications, including the Guardian and the Economist, and also helped to run a newsletter on terrorism. He has spent time at Lehman Brothers, Citigroup and the consultancy Lombard Street Research.

Matthew is the author of Superinvestors: Lessons from the greatest investors in history, published by Harriman House, which has been translated into several languages. His second book, Investing Explained: The Accessible Guide to Building an Investment Portfolio, is published by Kogan Page.

As senior writer, he writes the shares and politics & economics pages, as well as weekly Blowing It and Great Frauds in History columns He also writes a fortnightly reviews page and trading tips, as well as regular cover stories and multi-page investment focus features.

Follow Matthew on Twitter: @DrMatthewPartri