GMO offers this disclaimer.

*The chart represents local, real return forecasts for several asset classes and not for any GMO fund or strategy. These forecasts are forward‐looking statements based upon the reasonable beliefs of GMO and are not a guarantee of future performance. Forward‐looking statements speak only as of the date they are made, and GMO assumes no duty to and does not undertake to update forwardlooking statements. Forward‐looking statements are subject to numerous assumptions, risks, and uncertainties, which change over time. Actual results may differ materially from those anticipated in forward‐looking statements. U.S. inflation is assumed to mean revert to long‐term inflation of 2.2% over 15 years.

Measuring the Bubble

If one assumes 2.2% inflation per year, then the nominal decline is on the order of -3.4% per year for seven years.

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Compared to Hussman, GMO is outright optimistic. In Measuring the Bubble, Hussman forecast stocks will decline by two-thirds over twelve years.

I expect the S&P 500 to lose approximately two-thirds of its value over the completion of this cycle. My impression is that future generations will look back on this moment and say "... and this is where they completely lost their minds." As I’ve regularly noted in recent months, our immediate outlook is essentially flat neutral for practical purposes, though we’re partial to a layer of tail-risk hedges.

I side with Hussman but even GMO's optimistic forecast would crucify pension funds.

Mike "Mish" Shedlock

Few Places to Hide: GMO Forecasts US Equity Losses for 7 Years

If you are looking for a place to hide, GMO forecasts cash and emerging markets.

Y-o-Y Employment is Up an Average of 136K Per Month, Jobs 211,000 Per Month

Year over year employment is up an average of 136,000 per month. Jobs are up an average of 211,000 a month.

Congratulations Workers, You Now Make 0.5% More Than a Year Ago

In real (inflation-adjusted) terms workers make 0.5% more than a year ago, assuming one believes the CPI.

National Average Rent Inches Up by $3 Per Month

The increase in national average rents slowed to a crawl in July but year-over-year rates are up 3.4%.

Pension Dilemma: Expecting 7% Returns in a Negative Yield Setup

Wilshire Consulting predicts 6.25% return on US Equities over a decade. Hussman and GMO predict negative returns.

Congratulations Workers! You Make a Penny More Per Hour Than Last Month

The average worker makes a penny more per hour than last month in real terms. The year-over-year gain is precisely zero.

Wage Growth for Men About 1/4% Per Year Since 2000, Women About 1/2% Per Year

Women are slowly catching up to men in median wages but growth has been pathetic across the board.

National Average Rents Up 2.5% From Year Ago

Looking for inflation? One place you can find it is in national rent averages.

Let's Review 50 Years of Dire Climate Forecasts and What Actually Happened

Here are 21 headlines from various news sources regarding dire climate predictions over the last 50 years. Many of the predictions are outrageously funny.