Jeremy Grantham is warning that the stock market’s “superbubble” has yet to burst, but when it does, it will cause financial “tragedy” for investors. In other news, Steve Hanke, a professor of applied economics at Johns Hopkins University, says we’re in for a “whopper” of a recession in 2023, and it may not be because of interest rates.
NY Post/Thomas Barrabi
Famed investor Jeremy Grantham sees stock market ‘tragedy’ when ‘superbubble’ bursts
Despite a summer rally, the US stock market is still an unprecedented “superbubble” that will cause financial “tragedy” for investors when it bursts, according to famed investor Jeremy Grantham.
Grantham, the co-founder of asset management firm GMO in Boston, said the current superbubble is entering its “final act” due to deteriorating economic conditions. A recent “bear market rally” that saw the S&P 500 recoup 58% of its losses from a June low follows the pattern of past stock market crashes in 1929, 1973 and 2000, he added.
“The current superbubble features an unprecedentedly dangerous mix of cross-asset overvaluation (with bonds, housing, and stocks all critically overpriced and now rapidly losing momentum), commodity shock, and Fed hawkishness,” Grantham wrote in a letter to clients dated Wednesday.
You can keep reading, here.
Steve Hanke says we’re going to have one ‘whopper’ of a recession in 2023
The U.S. economy is going to fall into a recession next year, according to Steve Hanke, a professor of applied economics at Johns Hopkins University, and that’s not necessarily because of higher interest rates.
“We will have a recession because we’ve had five months of zero M2 growth, money supply growth, and the Fed isn’t even looking at it,” he told CNBC’s “Street Signs Asia” on Monday.
Continue reading, here.
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Gold price still on track to hit $7,000 at the end of the decade – Bytetree’s Charlie Morris
The gold market continues to languish below $1,750 an ounce; however, one fund manager said that the precious metal’s long-term potential remains firmly in place.
Charlie Morris, chief investment officer at Bytetree Asset Management, said that he still sees gold prices pushing to $7,000 by the end of the decade.
Morris’ outlook for gold comes as Bytetree continues to promote its new Gold/Bitcoin exchange-traded product. The 21Shares Bytetree BOLD ETP was launched as an inflation hedge that tracks an index comprising of bitcoin and gold. The fund is invested about 80% in gold and 20% in bitcoin.
“During the dark times, gold is the stronger asset, and during the good times, Bitcoin is stronger,” he said. “The fund has this natural counter cyclicality and it basically is like a 60/40 for alternative asset.”
You can keep reading, here.