The Making of a Permabear - by Jeremy Grantham (Hardcover)

Book Synopsis

From the renowned iconoclast investor comes a brilliant account of sixty years spent hunting for value and sidestepping bubbles in a changing financial world

When Jeremy Grantham entered the investment business in the 1960s, he brought the thrifty Quaker values and Yorkshire independence he had been raised with. While other money managers were focused on blue chip stocks, he studied stock market history and constructed by hand the first indices for small-cap and value stocks. Charting their ebb and flow, he could see clearly the powerful force that would become central to his investment philosophy: mean reversion, "the heartbreaking principle that good times always revert back to more boring, more ordinary times."

In the early 1970s Grantham launched the first index mutual fund. Soon after, he co-founded GMO and spent the firm's early earnings on a hard drive the size of an industrial washing machine, becoming the first firm to use a computer for investment analysis. The quantitative style they pioneered would take over the industry. In the late 1990s Grantham acquired notoriety as a "permabear" for refusing to buy into the dotcom mania. Clients left in droves--one called him "dangerously persuasive and totally wrong"--but he was vindicated when the bubble burst in 2000. Yet while his wealth grew, so did his alarm at the disastrous consequences of short-term thinking not just for investors but for the very future of the planet, and he has directed nearly all his wealth to environmental protection.

Written with his former colleague, the bestselling financial historian Edward Chancellor, The Making of a Permabear is replete with investment insights and provides a compellingly candid and witty insider's tour of the booms and busts of the past half century.

Review Quotes

Praise for Jeremy Grantham:

"Grantham's quarterly letters, which command a cult following of readers within and beyond the financial industry, inspire even the most short-term profit-minded investors to do a little fate-of-the-world-scale thinking."--Carlo Rotella, New York Times Magazine

"An investor routinely described as 'legendary'"--The Economist

"Jeremy Grantham's got a track record that's impossible to ignore--he called the Internet bubble, then the housing bubble. While moves like those have earned the famed forecaster the nickname "perma-bear," in early 2009 he also told clients...to jump back into the market. It was the same week that stocks hit their post-Lehman low."--Ian Salisbury, The Wall Street Journal

"[Grantham] occupies a legendary place in the world of finance for predicting all the major stock market bubbles of recent decades (and doing very well in the process)."--Leo Hickman, The Guardian

"The legendary investor [Jeremy Grantham]...is famous for predicting doom. And he's famous for being right, with a remarkable record of spotting investment bubbles before they pop."--Ben Steverman, Bloomberg Businessweek

"More than the [co-founder] of asset-management giant GMO, this man should be recognized as the world's greatest environmentalist."--Gus Lubin, Business Insider

Praise for Edward Chancellor:

"[Edward Chancellor is] one of the great financial writers of our era."--Financial Analysts Journal, on Capital Account

"Edward Chancellor has produced not just a brilliant explainer of the value of money and time but a hugely engaging history of the greatest problem confronting markets today. The Price of Time is a must read -- a copy should be on the desk of everyone who has anything to do with financial markets or wondered why things work as they do."--Merryn Somerset Webb, Editor-in-Chief, MoneyWeek, on The Price of Time

"Entertaining, useful, admirable . . . Chancellor seems to have read everything."--New York Times Book Review, on Devil Take the Hindmost

About the Author

Jeremy Grantham is widely regarded both as one of the world's greatest investors and a top environmental philanthropist. He is cofounder and long-term investment strategist of GMO, a Boston-based investment management firm with offices around the world, and founder of the Grantham Foundation for the Protection of the Environment. He is a member of the American Academy of Arts and Sciences and received the Carnegie Medal for Philanthropy in 2017 as well as the Harvard Business School's 2025 Alumni Achievement Award. He lives in Boston.

Edward Chancellor is an award-winning financial journalist and for several years worked with Jeremy Grantham at GMO. He is the author of The Price of Time: The Real Story of Interest, winner of the 2023 Hayek Book Prize, and Devil Take the Hindmost: A History of Financial Speculation, a New York Times Notable Book of the Year. He lives in Somerset.