'The simple rule is you can’t get blood out of a stone'

That’s how the doyen of grizzly bears, Jeremy Grantham, sums up the outlook for overvalued US stocks

'A Shiller P/E of 34 (as of March 1st) is in the top 1% of history. Total profits (as a percent of almost anything) are at near-record levels as well. Remember, if margins and multiples are both at record levels at the same time, it really is double counting and double jeopardy

’ As for the U.S. market in general, there has never been a sustained rally starting from a 34 Shiller P/E. The only bull markets that continued up from levels like this were the last 18 months in Japan until 1989, and the U.S. tech bubble of 1998 and 1999, and we know how those ended. Separately, there has also never been a sustained rally starting from full employment.

The simple rule is you can’t get blood out of a stone. If you double the price of an asset, you halve its future return

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