What information in Jeremy Grantham’s Quarterly Letters?
Mr Jeremy Grantham is a huge force sponsoring those who want to change the world’s economy based on their forecasts for 2100. And yet…
GMO’s Quarterly Letter – Third Quarter 2014 (text by Jeremy Grantham)
“Oil was $14 a barrel in 1998 and has now dropped to $83 from $115 (Brent). With costs of production at $60 or $70 a barrel, oil prices are not going back to $14 or even $40 (at least until renewables displace it more or less completely in a few decades). “
Quarterly Letter – Fourth Quarter 2014 (text by Jeremy Grantham)
“Under glut conditions, oil (and natural gas) is uniquely sensitive to declines toward marginal cost (ignoring sunk costs), which can approach a few dollars a barrel – the cost of just pumping the oil.”
Today’s news on CNN
“Crude plunged 4% to as low as $42.85 a barrel on Monday”
Back to Grantham’s 4th-quarter letter
“I believe the reason for the glut is not complicated…yes, my major regret for 2014 is, “How on earth did I miss this!” A combination of laziness and distraction is my lame excuse. “
What’s the value of the information published in the Quarterly Letters then?