Investor Jeremy Grantham advised to stay away from US stocks.
Veteran investor Jeremy Grantham believes U.S. stocks, especially those related to artificial intelligence, are grossly overvalued and the economy is headed for a recession, Business Insider writes .
The American market is absurdly expensive and has challenges ahead, while the economy is headed for a minor recession or worse.
The investor does not believe in artificial intelligence, considering the hype around it a “bubble” that is destined to burst.
The co-founder and strategist of wealth manager GMO advised investors not to bet on stocks that are "ridiculously more expensive" than the rest of the world.
The strategist promised that this year will be difficult for the stock market. Profit margins for U.S. companies are at historic highs relative to foreign peers, which is a double-dip risk for stocks if both earnings and multiples decline.
Grantham pointed to the existence of a multi-asset “super bubble” as early as early 2022, and noted that in early 2023, only the AI hype changed the trajectory of the entire stock market, which could have fallen 20-30%.
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