Jeremy Grantham Has an Even Scarier Prediction Than His Crash Call

(Bloomberg) -- Jeremy Grantham got the market’s attention with his “super bubble” call on U.S. stocks. Now he wants to get an even more alarming and urgent message out, one his critics may find harder to accept.

The “Goldilocks” period of the past 25 years is ending, and the world needs to prepare for a future of inflation, slower growth and labor shortages, the renowned value investor said in a Bloomberg “Front Row” interview.

“There’s only a certain amount of cheap oil, cheap nickel, cheap copper, and we are beginning to hit some of those boundaries,” said Grantham, co-founder of Boston asset manager GMO. “Climate change is coming with heavy floods, serious droughts and higher temperatures -- none of these make farming easier. So, we’re going to live in a world of bottlenecks and shortages and price spikes everywhere.”

Grantham, 83, insists that’s all inevitable because, along with the scarcity of raw materials, baby boomers are retiring, birth rates are declining, emerging markets are maturing and geopolitical tensions are flaring -- all trends decades in the making and almost unstoppable.