You can now sleep better at night. Jeremy Grantham, market strategist for GMO, an institutional asset management firm, has found the culprit for the market crisis. According to Grantham, the efficient market hypothesis is to blame for the financial crisis. Quoting Mr. Grantham, "The incredibly inaccurate efficient market theory was believed in totality by our financial leaders.... It left our economic and government establishment sitting by confidently, even as a lethally dangerous combination of asset bubbles, lax controls, pernicious incentives and wickedly complicated instruments led to our current plight". Clearly Mr. Grantham has a gift for hyperbole but is he speaking the truth? Let's take apart his claims:
Culprit found for market crisis!!!!
Culprit found for market crisis!!!!
Culprit found for market crisis!!!!
You can now sleep better at night. Jeremy Grantham, market strategist for GMO, an institutional asset management firm, has found the culprit for the market crisis. According to Grantham, the efficient market hypothesis is to blame for the financial crisis. Quoting Mr. Grantham, "The incredibly inaccurate efficient market theory was believed in totality by our financial leaders.... It left our economic and government establishment sitting by confidently, even as a lethally dangerous combination of asset bubbles, lax controls, pernicious incentives and wickedly complicated instruments led to our current plight". Clearly Mr. Grantham has a gift for hyperbole but is he speaking the truth? Let's take apart his claims: