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Jeremy Grantham Q4 Letter: Pavlov's Dogs

Tyler Durden's picture





 

In Jeremy Grantham’s 4Q Letter, he summarizes what went well and not so well in 2010, then looks ahead to 2011, sharing what he believes to be critical issues for investors to focus on. He also continues his series of Letters to the Investment Committee with a piece called “On the Importance of Asset Class Bubbles for Value Investors and Why They Occur.” Must read.

Pavlov’s Bulls (pdf)

 

 


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Tue, 01/25/2011 - 16:28 | Link to Comment Mrmojorisin515
Mrmojorisin515's picture

Anyone notice the market going up like a rocket and then falling just as hard two mins later?

Tue, 01/25/2011 - 16:29 | Link to Comment redpill
redpill's picture

PPT in the house!

Tue, 01/25/2011 - 16:36 | Link to Comment 101 years and c...
101 years and counting's picture

IBM.  161 to 164.35 in a second. 

Tue, 01/25/2011 - 16:39 | Link to Comment Cognitive Dissonance
Cognitive Dissonance's picture

Desperate lunge for the finish line. It failed in case anyone didn't notice.

Tue, 01/25/2011 - 16:53 | Link to Comment HarryWanger
HarryWanger's picture

Straight up for the past half hour. Looks to be a nice intraday reversal. Signals a good week ahead.

Tue, 01/25/2011 - 18:56 | Link to Comment onlymyopinion
onlymyopinion's picture

I agree, especially given the nice sell off we had last week.  Time to head back up.  Outstanding Consumer Confidence numbers IMO will only get better as the markets continue higher.  2011 shaping up to be another winner. 

Tue, 01/25/2011 - 19:16 | Link to Comment LowProfile
LowProfile's picture

I look forward to you eventually joining Johnny Bravo in his Frigidaire shipping container condo under the overpass.

Tue, 01/25/2011 - 19:35 | Link to Comment knukles
knukles's picture

Why does anybody even bother to pay attention anymore? 

Tue, 01/25/2011 - 16:39 | Link to Comment Yen Cross
Yen Cross's picture

 I had a comment! An erroneous spike? So that explains Pavlov's Bulls.

Tue, 01/25/2011 - 16:41 | Link to Comment Bigger Dickus
Bigger Dickus's picture

The TOP in the s&p 500 for the next two years is in: HUGE head and shoulders pattern

 

shoulder 1 was the top of the .com bubble.

the head was late 2007

shoulder 2 could be anywhere between this level and the 2001 top. If the correction continues into the next few days, go short on margin.

Tue, 01/25/2011 - 16:44 | Link to Comment onlymyopinion
onlymyopinion's picture

I really do need to go from 80% long to 100% now.  LOL.  Gawd I heart top-callers. 

Tue, 01/25/2011 - 16:44 | Link to Comment Deep
Deep's picture

you mean DOW right.

 

Tue, 01/25/2011 - 16:46 | Link to Comment Bigger Dickus
Bigger Dickus's picture

both. Technically, the double top for the s&p is in for the next 10 years.

Wed, 01/26/2011 - 11:52 | Link to Comment onlymyopinion
onlymyopinion's picture

Darn! I was hoping with your double topper you'd have taken my bet.  I guess you ain't that silly.  ROFLMAO!

Tue, 01/25/2011 - 16:59 | Link to Comment Prof Gulliver
Prof Gulliver's picture

Adjust your TA charts for Infinite Bennie Bux.

Tue, 01/25/2011 - 18:33 | Link to Comment onlymyopinion
onlymyopinion's picture

edit

Tue, 01/25/2011 - 18:35 | Link to Comment onlymyopinion
onlymyopinion's picture

Betcha an innernet brewski we print 1300+ this week.   Afterwards I'll be so kind to allow you a chance to double down on a bet we'll also see a 1400+ print by EOY. 

Tue, 01/25/2011 - 16:41 | Link to Comment RobotTrader
RobotTrader's picture

Virtually every hedge fund trader on the planet is trying to front-run the Davos comments or figure out if The Bernank is going to halt QE or not.

Tape is now trading as if all the quants were on crack.

Tue, 01/25/2011 - 16:44 | Link to Comment Bigger Dickus
Bigger Dickus's picture

Is that your daughter?

Tue, 01/25/2011 - 16:48 | Link to Comment youngman
youngman's picture

need it over 12,000 for the big speech tonight also

Tue, 01/25/2011 - 16:49 | Link to Comment Gubbmint Cheese
Gubbmint Cheese's picture

the only way QE2 will stop is so QE3 can start.

No way to stop this money train...

 

Tue, 01/25/2011 - 17:08 | Link to Comment Sudden Debt
Sudden Debt's picture

I'm pretty sure there will never be a QE3

Obama needs to cut spending.

Fire people.

I don't think that if he fired 500.000 government employees and will order a QE3 BANK BONUS, that the voters would like it, so congress wouldn't aprove.

 

NOP, QE2 is running out and better start making it 1 BULLET 1 KILL

 

Tue, 01/25/2011 - 17:50 | Link to Comment Cdad
Cdad's picture

SD,

Correct.  I think this constant clamor for QE3 is from the wishful thinking crowd.  Strangely, that puts us within the six months of that end...which makes today's last minute stick save rally very strange, indeed.

 

Tue, 01/25/2011 - 18:05 | Link to Comment Sudden Debt
Sudden Debt's picture

If QE2 didn't do it, QE3 won't either and people would only start talking about a QE4 if they ever mentioned QE3.

 

Nop, Sugar Daddy Benny B. is calling it quits after this one.

 

 

Tue, 01/25/2011 - 18:16 | Link to Comment Quinvarius
Quinvarius's picture

I don't see the connection between giving insolvent banks money through QE and Obama cutting spending.

Tue, 01/25/2011 - 16:50 | Link to Comment entendance
Tue, 01/25/2011 - 17:00 | Link to Comment Orly
Orly's picture

Wow.  Anyone besides me see the rather unusual, unnatural-looking trading at the close of the session?

Something fishy is going on here...

/:

Tue, 01/25/2011 - 17:07 | Link to Comment HarryWanger
HarryWanger's picture

Just dip buyers. We should see some nice upward momentum continue tomorrow with the State of the Union tonight and FOMC tomorrow. The market leaders like AAPL have turned in the past two days to continue higher as well. I guess we saw our dip. I thought maybe we'd get to 1250 but they didn't let it get that low.

Tue, 01/25/2011 - 17:21 | Link to Comment Orly
Orly's picture

BTFDers, you say.

Okay.

Tue, 01/25/2011 - 17:38 | Link to Comment Sudden Debt
Sudden Debt's picture

BUY ANY STOCK YOU WANT!!!!

 

As long as you remember to buy the puts that go with it ;)

 

 

 

Tue, 01/25/2011 - 19:40 | Link to Comment knukles
knukles's picture

There be birthers, truthers, gold bugs and whateverers, so lets now add "ralliers".  Another buncha Conspiracy Theorists! 

Tue, 01/25/2011 - 17:04 | Link to Comment firstdivision
firstdivision's picture

Any stop in QE will result in a tanking of all markets.  QE is the only thing keeping banks solvent long enough for a day.  There is no end in sight at this point, so just be prepared for Ben to start talking about QE3.

Tue, 01/25/2011 - 17:08 | Link to Comment Flapjackmaka
Flapjackmaka's picture

FOMC meeting tommorow right? Oh boy

Tue, 01/25/2011 - 17:06 | Link to Comment Flapjackmaka
Flapjackmaka's picture

The Dow is down even with POMO. Are we nearing a top for stocks or can Bennie still ponzi around? thoughts?

Tue, 01/25/2011 - 17:25 | Link to Comment the not so migh...
the not so mighty maximiza's picture

My 1 cent is that the PD's will spend like crazy tommorow and give a hugh rally tommorow.

Tue, 01/25/2011 - 18:18 | Link to Comment Sudden Debt
Sudden Debt's picture

If your long on stocks worth 1 cent. That's not a high risk.

Otherwise:

Today, I've seen a lot of stock take out stops and go down pretty fast.

Untill they all suddenly started to rise at the same time.

These kinds of tricks costs billions a day.

And the cookie jar of the FED is looking mighty empty now.

It may make sense to you that they inject like forever and that it's a sure thing every day, but nothing lasts forever.

Tue, 01/25/2011 - 17:10 | Link to Comment CIABS
CIABS's picture

that's great.  now can someone put up a pdf, not a scribd, of grantham's eisenhower piece?

Tue, 01/25/2011 - 17:17 | Link to Comment 6 String
6 String's picture

....and not a single word about America's Fiscal Trap. Debts just don't matter until they do I guess.

So.....it's off and running for the major indexes this year, while precious metals get pummeled to death.

I'm taking all my money and going home.

Tue, 01/25/2011 - 17:31 | Link to Comment tarsubil
tarsubil's picture

So the market is rocketing up for no reason and gold and silver are dropping despite common sense, and you're taking your money home? Why not take advantage of a buying opportunity?

Tue, 01/25/2011 - 17:38 | Link to Comment 6 String
6 String's picture

tar, just a sarc post. If silver gets down to below 20 I'm all-in.

Tue, 01/25/2011 - 18:06 | Link to Comment redrob25
redrob25's picture

I stopped reading after he insisted weather patterns were related to global warming.

Tue, 01/25/2011 - 18:08 | Link to Comment Orly
Orly's picture

Same here.

Wed, 01/26/2011 - 14:53 | Link to Comment blindfaith
blindfaith's picture

weather patterns and climate patterns are two very different things.  The later affects the former, not the other way around.  Weather patterns are sort of like the daily markets, climate patterns are like Ellioit Wave, 200dma, long term patterns, etc.

You can ignore the opinion but not the data.

Tue, 01/25/2011 - 18:20 | Link to Comment Yen Cross
Yen Cross's picture

 A Povlov comment! Breath. Ahhhh Breath!!!! Pick some XAG @ 22 and some change.

Tue, 01/25/2011 - 18:43 | Link to Comment LooseLee
LooseLee's picture

Like we keep saying; there's a sucker born every minute. Buying at the top is the trademark of a fool. In America fools are behind most everything anymore; especially this communist stock market.

Wed, 07/06/2011 - 05:10 | Link to Comment jimmight
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Mon, 07/25/2011 - 06:33 | Link to Comment cindycheng
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