Grantham: ‘No market for young men’

[biaggio]

http://www.marketwatch.com/story/grantham-no-market-for-young-men-2011-09-21

 

“If we adjust earnings to normal and apply an average P/E, you can finally build a decent portfolio today of global equities at a respectable long-term return,” he said.

 

The potential for gains is “modestly higher” outside of the U.S., he added, other than “high-quality blue-chips.” Mostly, he said he prefers discounted plays that are surfacing in Europe and emerging markets.

 

“In stocks you will eventually do OK at these prices,” Grantham said.

 

“The real danger is one or two of these building blocks falling over,” Grantham said. “You can buy a whole portfolio of slightly cheap global stocks, and the risk you take is that you get sandbagged by some of these major problems.”

 

Indeed, Grantham said that since there’s a “decent chance” of stocks becoming even cheaper, GMO is positioned slightly below normal in equities “because the risk profile of the world is way over normal.”

 

...He’s not a big fan of gold. “I own some myself as a pure speculation,” Grantham said — “just enough to mute the irritation of watching gold [prices] rise.”

[ERICOPOLY]

Damn, I guess we younger guys that have seen two 50% declines in 10 years and a sideways market are just spoiled.

 

Those older guys were battle hardened by the bull market, of which we have yet to see!

 

[tombgrt]

Lol at "young men". At whom is he referring, 16-year olds?

 

I got interested when things started plummeting in 2008. I believe that had a significant impact at how I look at risks and (value) investing in general.

 

 

...He’s not a big fan of gold. “I own some myself as a pure speculation,” Grantham said — “just enough to mute the irritation of watching gold [prices] rise.”

 

That's funny.  ;D

[Parsad]

I think when you get guys like Grantham saying things like that, it simply means they are as confused as everyone else about what they see.  It's been a tough five years for investors, and maybe even a tough twelve years, and so people are rightly puzzled. 

 

Again, this just goes back to Ben Graham.  Nothing that he taught would have been fundamentally different in either that five year or twelve year period.  It would have worked for both, just like the last 75 years.  Cheers!