Recent Thoughts of Jeremy Grantham

By on July 30, 2008

Recent articles in “Investment News” and “” included some interesting quotes from Jeremy Grantham:

“The idea that you would solve a long-term problem of too much debt by paying people to take debt, by having a negative real rate, brings to mind the hair of the dog that bit you. The guy is a drunk and you’re offering him a kind of early morning pick-up. It may get him to the office feeling reasonably good but it doesn’t do much for his cirrhosis of the liver.”


“I have a job description for the Fed, which is a lot simpler than the compromising combination of growth and inflation, and that is to protect the integrity of the U.S. financial system. It does seem to me entirely appropriate for the Fed to have that on the list. They have totally allowed the integrity of our financial system to erode in the last 20 years and they should be ashamed of themselves.”


When asked by a money manager what he would buy now, Grantham said, “long mattresses”—jesting about the stereotypical nervous behavior of hoarding cash. He seriously suggested: “Put money into something incredibly safe, like a high-quality hedge fund.”


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