Sunday, May 10, 2009

Grantham: The Last Hurrah

jeremy Grantham's latest quarterly is out at the GMO site. This is a superb piece and should be read by any investor. I have been arguing the case for weeks that this rally would continue because the real driver behind it was the stimulus put in place by the Bush administration in early fall. There has only now been enough time for the effects to show up. Obamas stimulus moves will suffer the same fate; it takes 6 months to a year for monetary stimulus to work its way through the economy. But Grantham demonstrates the power of stimulus on the stock market by looking at the presidential cycle and how little stimulus it takes to move the market.
Mr. Grantham also makes the case that while this rally can be much more powerful than generally expected it is only a rally and that the market is likely to languish for years.
by clicking on the GMO link above you will go to their site where you will be asked to register. this is free and over several years I have never been emailed or solicited in anyway. You will find some very good research on the site which is made available generously for free.

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