When consensus swings

April 2026

At a time when consensus is swinging sharply with the uncertainty in energy markets and the war in the Middle East, it can be helpful to step back and focus on the bigger picture. With that in mind, we very much enjoyed Jeremy Grantham’s talk at the Library of Mistakes this month (here). A committed value investor, he reflects on decades of experience in markets. The dot-com bubble was far from easy for GMO LLC, and his experience is a reminder of the strong returns that can come from perseverance and maintaining a clear view of what matters over the long term.

Current S&P 500 valuations, measured by the Shiller CAPE, have been surpassed only at the height of the dot-com bubble. In our view, that crowded consensus means that long-term investors should be focused elsewhere.

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