Top investor predicts stock market collapse

When Jeremy Grantham (83) speaks, investors sit up. The co-founder and investment strategist of asset manager Grantham, Mayo, & van Otterloo (GMO) fits in with investment greats such as Warren Buffett and George Soros.

And Grantham now provides doom & gloom. “The current super-bubble consists of an unprecedentedly dangerous mix of overvalued investments: bonds, houses and stocks that are all dangerously overvalued and now losing momentum rapidly. Each cycle is different and unique – but every historical parallel suggests the worst is yet to come.”

According to the Financial Times, we should listen to Grantham who, in particular, correctly predicted the deep crisis of 2008 as early as 2007.

Grantham also points to all the plagues that plague the world: the Ukraine war, rising food prices, expensive energy, declining growth in China. And those are just the short-term problems. In the slightly longer term, there is also the aging of the population and climate change, with investors rightly noting that the consequences of this are already manifesting themselves.

What is all this leading to? Prices are going to fall, and hard.

“Get ready for a dramatic final,” Grantham wrote in Wednesday’s report. “If history repeats itself, this will be another tragedy.”

 Financiel Times  FD  Business Insider  


Why Does Hillary Want To Be President, Anyway?

Wall Street Journal

By Karl Rove
December 11, 2014

Why Does Hillary Want To Be President, Anyway?

So far it looks like Mrs. Clinton would have at least as many problems in 2016 as she did in 2008.

There have generally been two reactions to former Secretary of State Hillary Clinton’s Dec. 3 statement at Georgetown University that America should try to “empathize” with our nation’s “enemies.”

One camp holds that Mrs. Clinton simply chose the wrong word to express a banal thought—that the U.S. must understand its enemies. The other camp says her State Department record demonstrates she herself lacks the empathy to know how to deal with America’s adversaries or allies.

Both responses are true, yet I have another observation about her speech: It is further evidence Mrs. Clinton is at best a mediocre presidential candidate. She was lackluster in 2008 and worse today. The stiff, off-putting style is familiar. What’s more surprising is how sloppy, ill-prepared and tone-deaf she has become.

If Mrs. Clinton intended to say we must understand our adversaries—their motivations, methods and goals—she should have said so. If her speechwriter’s draft was unclear, she should have ordered a rewrite. If she can’t summon warmth and wit now, how will she display a winning personality in her umpteenth hundred event, assuming she becomes a candidate?

The empathy quote was memorialized on video. It may come back to haunt her: Sounding like President Obama on foreign policy isn’t going to help her win in 2016, when the world is likely to be more chaotic and American interests even more threatened.

This is not Mrs. Clinton’s first political misstep this year. There was her early summer book tour where she explained she and her husband were “dead broke” when they left the White House, nearly unable to afford their “houses,” and then went off on an NPR reporter who was trying to help her explain away her former opposition to gay marriage.

Campaigning for Democrats in the midterms was no better. On Oct. 24 in Boston, she uttered the inanity, “Don’t let anybody tell you that, you know, it’s corporations and businesses that create jobs.” By the way, there are few grateful Democrats whose campaigns she helped since almost all of them lost.

After the election, more mistakes. At a Nov. 21 black-tie gala in New York, Mrs. Clinton endorsed Mr. Obama’s executive order on immigration by suggesting the events’ servers and food preparers were in the country illegally, as were most construction workers.

Reporters have largely overlooked Mrs. Clinton’s blunders, but it is not inconceivable that at least some of them may start holding her accountable to the standard they apply to gaffes uttered by Republican hopefuls.

Meanwhile, Hillary’s operation promises to be entertaining. There have been news reports of infighting among her proto-campaign high command (never a good sign) that included the leak of emails thought to be embarrassing to an aspirant for campaign manager (never a good precedent).

Most telling—and damaging—she still has no core message. This is 22 months following her resignation as secretary of state. She suggested to Charlie Rose on July 17 that she might focus on what to do “to tackle growth, which is the handmaiden of inequality.” That sounds less like a message than a tactic to placate the Democratic Party’s populist Occupy Wall Street wing with a pale imitation of Sen. Elizabeth Warren.

Even her husband frets she doesn’t have a message. Former President Clinton recently told CNN that “we’ve reached a point in our life when we think you really shouldn’t run for office if you don’t have a clear idea of what you can do and a unique contribution you can make and you can outline that. Now that the book is done, she wants time to think about that and work through it. I think so much of politics is background noise, and we don’t need the background noise anymore.”

The next presidential election is in 23 months. But no amount of time is likely to be enough for Mrs. Clinton to make herself a much better candidate. She is who she is and cannot change. In 2008 she could not articulate a compelling purpose for her run and stressed only her inevitability and entitlement. So far, it looks like Hillary 2.0 will have at least as many problems as Hillary 1.0.

It’s hard for a political party to win three consecutive terms in the Oval Office. Since 1952, only George H.W. Bush was able to do it for his party after Ronald Reagan ’s two terms. Unfortunately for Democrats, Mr. Obama is no Reagan—and as they may soon find out, Hillary is no Bush 41.

A version of this article appeared December 11, 2014, in the U.S. edition of The Wall Street Journal, with the headline Why Does Hillary Want To Be President, Anyway? and online at

The Alchemists of Wall Street

Quants are the math wizards and computer programmers in the engine room of our global financial system who designed the financial products that almost crashed Wall st. The credit crunch has shown how the global financial system has become increasingly dependent on mathematical models trying to quantify human (economic) behaviour. Now the quants are at the heart of yet another technological revolution in finance: trading at the speed of light.

What are the risks of treating the economy and its markets as a complex machine? Will we be able to keep control of this model-based financial system, or have we created a monster?

A story about greed, fear and randomness from the insides of Wall Street.

Director: Marije Meerman
Research: Gerko Wessel