The British stock market expert and co-founder of Boston-based asset management firm Grantham, Mayo & van Otterloo (GMO) issued his warning through a letter to his firm’s clients. He wrote that the incidence of the high-risk stock market plummeting is entering its final stage due to worsening economic conditions.
Grantham explained that the recent superbubble features an unprecedented dangerous mix of commodity shock, hawkishness by the Federal Reserve and cross-asset overvaluation. Bonds, housing and stocks are all critically overpriced and now rapidly losing momentum.
“Each cycle is different and unique – but every historical parallel suggests that the worst is yet to come,” he added.
“Previous superbubbles saw a much worse subsequent economic outlook if they combined multiple asset classes: housing and stocks, as in Japan in 1989 or globally in 2006; or if they combined an inflation surge and rate shock with a stock bubble, as in 1973 in the U.S. and elsewhere.”
Grantham added that current market conditions are “exactly in line” with historical precedents. “If history repeats, the play will once again be a tragedy. We must hope this time for a minor one,” he warned.
The GMO co-founder spoke from experience – having successfully predicted the 1989 Japanese bubble, the 2000 dot-com bubble and the 2007 housing bubble.
Back in January 2022, Grantham predicted that the S&P 500 could plummet to nearly 50 percent. This, he added, was driven by short-term pressure from food and energy shortages due to the Russia-Ukraine war, Wuhan coronavirus (COVID-19) lockdowns in China and the “fiscal tightening” due to the end of the pandemic-era stimulus programs. (Related: The next stock market crash is already on its way, and America could lose $35 trillion in the collapse.)
“The recent ‘bear market rally’ saw the S&P 500 recoup 58 percent of its losses from a June low follows the pattern of past stock market crashes in 1929, 1973 and 2000,” he said.
Biden lying with his claims that stock market is 20 percent higher
Meanwhile, President Joe Biden himself made the bold declaration that the stock market is 20 percent higher under his administration.
“The stock market – the last guy’s measure of everything – is about 20 percent higher than it was when my predecessor was there. It has hit record after record after record on my watch while making things more equitable for working-class people, ” the president said.
With the impending explosion of the superbubble and analysts refuting his statements, it appeared Biden was sugarcoating or blatantly lying about the current economic situation.
Back in June, wealth management adviser Tim Picciott told Josh Sigurdson of World Alternative Media that America’s reckless money printing over the past 14 years is to blame for the stock market collapse. Even though Biden declared “zero inflation,” the wealth management expert said inflation is widely felt by American households. Moreover, he added that “consumer price index and personal consumption expenditures are actually through the roof.”
Ultimately, Sigurdson pointed out that the collapse of the stock market, economy, supply chain and gas reserves aligned with the Great Reset.
“People controlling the money are the people at your bank, the people printing the money, the people that are manipulating this stock market,” he said.
Visit Bubble.news for more news related to the failing stock market.
Watch financial expert Gregory Mannarino warn about the bond market becoming unstable and preceding a stock market crash in the video below.
This video is from the What is happening channel on Brighteon.com.