The US stock market rally is very deceptive, warns Jeremy Grantham, British billionaire investor and co-founder of GMO LLC ($160 billion under management). The growth has been mainly driven by the hype around AI, which has caused a bubble to form in the market. However, the latter will burst - prices are now incredibly high, and the U.S. economy is beginning to collapse, reports the words of the expert edition of Business Insider.
The probability of recession in the United States over the next year and a half, the investor estimated about 70%, noting that the Federal Reserve and the economic establishment traditionally underestimate the risk of its occurrence.
Grantham also pointed to the overvaluation of the residential real estate market - after two decades of falling interest rates, the cost of the latter has risen to exorbitant levels in many developed countries, he said, adding that he would not invest in it. The expert also warned against investing in commodities because of their "unpredictable and shocking" drops in price.