The Canary

I have great respect for Jeremy Grantham and I must admit to ripping off his method of arriving at a fair value on the S&P 500 (approximately 900). Last quarter Jeremy Grantham decided to take a speculative long based on the "liquidity" trade. He just wanted to join the party. In hindsight, that was the canary in the coal mine. If even one of the biggest big picture bears turned positive, based on essentially "a feeling" than the market had sucked in everybody. Even the greats make mistakes and the stock market is a never ending learning process. His excellent quarterly piece is now available on the GMO website.

2 comments:

Anonymous said...

The prior several earnings quarters were all smoke and mirrors. All done with cost cutting measures and layoffs.

Unless they either drastically LOWER future estimates or there is a major pickup in the economy, sales and revenues for these companies will not improve.

The stock market should be correcting to show this very soon.

Anonymous said...

Feels like this market is being bought today? It's not falling apart.