Insights

When asked what people would learn from the 2008 financial crisis, Jeremy Grantham responded, “In the short term a lot, in the medium term a little, in the long term, nothing at all.”

We’re not saying that this is 2021 all over again, but the number of speculative indicators flashing red is rising by the day. Our favourite example so far is Allbirds, a shoe company that announced a pivot to artificial intelligence (AI) and subsequently saw its shares rocket over 600%. Maybe it will be the next great AI play, but something tells us unprofitable footwear is perhaps not the best starting point.

We can jump to the punch line here: it’s difficult to imagine how those growth rates could be achieved—particularly in the U.S. The implication is that investors should be braced for lower broad-based equity returns and be more focused on asset class and manager-specific return profiles.

We can jump to the punch line here: it’s difficult to imagine how those growth rates could be achieved—particularly in the U.S. The implication is that investors should be braced for lower broad-based equity returns and be more focused on asset class and manager-specific return profiles.