Jeremy Grantham says this is the most expensive market in American history. He's been saying this since 2017. He said it in 2018. He said it in 2019. He said it in 2020. He said it in 2021. He's now saying it in 2025. The man has called fourteen of the last zero crashes.
The thesis this time involves AI valuations. Apparently stocks tied to artificial intelligence are overpriced. This would shock you if you hadn't noticed Nvidia trading at a valuation that assumes they'll eventually sell chips to Mars colonists. Grantham sees bubbles everywhere. Always has. It's his brand. He's the financial equivalent of a guy who brings a helmet to a swimming pool.
Retail traders heard the warning. They understood the risk. They processed the historical context. Then they bought more calls on companies that don't make money and never will. Because when a legendary investor with decades of experience says the market is dangerously overvalued, the correct response is obviously to leverage your Robinhood account into semiconductor ETFs. That's just science.
Grantham runs GMO. The firm has underperformed for years while waiting for the crash. They've been positioned defensively so long their portfolio is basically a bomb shelter with dividend stocks inside. But sure, this time he's right. This time it's different. This time the most expensive market in American history will actually become the most expensive market in American history that also crashes, rather than the most expensive market in American history that becomes next year's second-most expensive market.
The AI bubble will pop eventually. Grantham will claim vindication. Retail will lose everything. And somewhere, a 24-year-old with a YouTube channel will explain that he saw it coming all along while his account balance rounds to zero.
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