Jeremy Grantham, chief investment strategist at GMO and one of the biggest proponents of the super-cycle theory of ever rising prices has long warned that natural resources were running out and that the price of everything from minerals, energy and food would remain high. He now admits that he was wrong (click here for client note).
Grantham, best know for spotting bubbles in equity markets recognises that they are hard to spot
Giant bubbles are easy to spot statistically but hard to call from a career risk perspective. It is easy to be early, and being early may lose you your job, your clients, and your credibility. The fear is always, “Are these new high prices permanent? Is it a paradigm shift?” Every major bull event is called a paradigm shift but they almost never exist. Almost never. But not never, ever