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Jeremy Grantham's latest letter


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Boring fair price @ http://www.gmo.com

 

Fair value, presidential cycles, contingency plans and more ..

 

I can't see how these two plans are not mutually exclusive.

 

"I also suggested Plan B: if you missed the earlier

lows, you must grit your teeth and phase slowly into a

cheap market. You can’t gamble that it will oblige you by

another low, and historical analogies with earlier, much

lower market lows are fraught with genuine differences."

 

and

 

"Given our view that we are in for seven lean years in which

the market will be looking for an excuse to be cheap, we

recommend taking some risk units off the table, including

becoming underweight in equities – between 1000 and

1100 on the S&P, if it gets there this year. Around 880

you should continue to move slowly to fair value, twiddle

your thumbs, and wait to see what happens."

 

 

 

 

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  • 2 weeks later...

As always, an interesting read.

 

However, the most interesting part, in my view, was in the footnotes and his reference to the items below. As I am an admirer of all things written by Garrett Hardin, his reference to Living within Limits was of some insight. It is also a Munger recommendation.

 

Living within Limits: Ecology, Economics, and Population Taboos

http://www.amazon.com/Living-within-Limits-Economics-Population/dp/0195093852/ref=cm_cr-mr-title

 

The Most IMPORTANT Video You'll Ever See

 

 

Cheers

JEast

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