As Flummoxed as Everyone Else
What we are seeing now is a tussle between the 50% sustained speculation branch and the branch where two or three things go wrong and crack confidence. This struggle is an unusual one, and has created market effects I have never seen before, and you have not either.
–Jeremy Grantham, GMO Q2 2010 Newsletter
Somewhere [in the last 30 years], without any formal announcement of the change, the “client” in a trade mutated into a “counterparty” who could be exploited.
–Jeremy Grantham, GMO Q2 2010 Newsletter
That’s because the influential investor just released his most recent quarterly newsletter.
For once, I didn’t glean anything new or groundbreaking; the main highlight making the rounds is that Grantham has officially come down on the “deflation” side of the ‘flation issue, at least in the short run.
The other sign that Grantham is flummoxed by today’s uncharted financial waters: his three “weighted probability” scenarios, in which the chance of a big “up” move is put as just about the same as a big “down” move.
He might as well have just shrugged his shoulders.
