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Is America on the Precipice of a ‘SuperBubble’ Crash?
An analyst, who prophesized the last three busts, says the mother of all collapses has already begun
Modern finance capitalism has been a roller coaster for most Americans and the world. On average, the highly-leveraged debt-fueled economy has been creating a recession every seven-odd years. Cheap borrowed money rushes into a hot market, new industry, or new investment vehicle and artificially inflates prices. The perceived value detaches from reality. People think the market will only continue to grow, pushing prices even higher, and creating a bubble that eventually bursts, showering economic hardship and ruin onto ordinary citizens.
Many saw the Dot-com crash coming, a few even saw what was happening to the US housing market before ’07. Not many people can say they clearly forecasted them both.
Jeremy Grantham is one of those people. He’s a measured man that analyzes markets and invests for a living. When he speaks, people listen. And he recently wrote an in-depth report laying out the dire financial situation in the US of A.
He says all signs are pointing to a 1929-level crash in America that will make the Great Recession look meek.
And he says it’s already begun.
“You can perhaps only have that degree of confidence if you have been to the history books as much as we have and looked at every bubble and every bust.” — J.G.
The financial prophet
Jeremy Grantham is a British investor with a solid track record. He’s the chief investment strategist at the Boston-based asset management firm he co-founded called Grantham, Mayo, & van Otterloo (GMO). His investment philosophy is referred to as “reversion to the mean,” which basically dictates that markets and asset classes will always return to their historical average value.
Whether it is a crazy accelerated peak or an acute downturn, the value of investments usually returns close to that historic average. His firm analyzes long-term trends of a market or asset and predicts results seven years into…
