Overview
Jeremy Grantham -- co-founder of GMO, 60-year investing veteran, and billionaire who has given away over 90% of his wealth to environmental causes -- sat down with Steven Bartlett on The Diary Of A CEO to deliver one of the most wide-ranging market warnings in recent memory. His central claim: the AI investment bubble is the largest in American history, surpassing the dot-com era in scale and euphoria, and it will burst. The only question is timing.
Grantham does not mince words on portfolio strategy. He advises selling all US technology stocks and shifting toward non-US equities -- particularly emerging markets and European indices -- which have significantly outperformed the S&P 500 over the past 12 months despite receiving far less attention. His recommended allocation is approximately 60% non-US equities, 5-10% precious metals, some real estate where sensible, and the remainder in bonds. He is explicit that investment advisers will never tell you to get out of a bubble -- because their business model depends on assets under management.
The second major thread is the global fertility crisis. Grantham traces the accelerating decline in human sperm counts -- from approximately 100 million units per milliliter in 1970 to around 35 million today -- to environmental toxins: phthalates in cosmetics and food packaging, BPA in plastics and tin can linings, PFAS forever chemicals in nonstick cookware and waterproof fabrics, pesticide residue in produce, and microplastics now found embedded in human brain tissue, placentas, breast milk, and testicular tissue. He argues this is an existential civilizational risk that is being systematically ignored.
The conversation also covers wealth inequality and the social contract (the US Gini coefficient now rivals Brazil and Mexico), the competitive dynamics among the Magnificent 7 in AI, the case against SpaceX's valuation, AI safety and the benevolence problem, and the best places to live given deteriorating social infrastructure in the United States.
Why This Matters
Grantham is one of a very small number of investors who called the dot-com crash and the 2007 housing collapse in advance -- and paid a professional price for being early both times. His bubble framework is not speculation; it is a systematic pattern-matching approach built over six decades of market data. When he says the AI bubble is the largest in American history, it is worth understanding why he thinks that, even if the timing of a peak is uncertain.
The investment adviser incentive problem he describes is structural and permanent. No major firm will tell retail investors to exit a bubble, because doing so costs them business in the near term and exposes them to being wrong early. Understanding this dynamic changes how you should weight the financial media's optimism -- it is not analysis, it is a conflict of interest wearing the clothing of analysis.
The fertility section is the most underreported story in this interview. Grantham frames declining sperm counts not as a lifestyle or demographic trend but as a measurable, quantifiable chemical event with a projected endpoint. If the trajectory is roughly correct -- median sperm count approaching zero by the mid-2040s -- the downstream consequences for population, labor markets, economic growth, and geopolitics are so large they dwarf most other risks discussed in financial media. Knowing which chemicals are driving this, and what practical steps exist to reduce exposure, has direct personal relevance for anyone planning to start a family.
Taken together, this interview is a rare alignment of macro investing insight, environmental science, and civilizational risk assessment from someone with the track record and financial independence to say what institutions cannot.
Key Points
- The AI investment bubble is, in Grantham's view, the largest in American history -- driven by genuine transformational technology, just as the railroads and the internet were, but with proportionally larger over-investment and euphoria.
- A 70% decline in the highest-flying AI-adjacent stocks would not be historically unusual; the Nasdaq fell 82% in the dot-com crash and the Japanese market fell for 20 consecutive years after its 1989 peak.
- Investment advisers will never warn you to exit a bubble. Their business model depends on assets under management, and warning clients costs them accounts in the near term. The engine-room analysts privately know the market is overpriced; the client-facing layer will never say so.
- Grantham's recommended portfolio for the current environment: approximately 60% non-US equities (emerging markets, Europe, Japan), 5-10% precious metals, some bonds, and no US technology stocks or crypto.
- Non-US equities, particularly emerging markets, have outperformed the S&P 500 by a wide margin over the past 12 months -- a fact that receives almost no mainstream financial media coverage.
- The Magnificent 7 tech companies, which previously enjoyed separate near-monopolies, are now all fighting each other in the same AI arena with massive leveraged capital expenditure. The winner-take-all dynamic means most of them will lose.
- SpaceX is, in Grantham's framing, a classic peak-bubble indicator: its prospectus defines its addressable market as a quarter of global GDP and includes asteroid mining, which he compares directly to the South Sea Bubble prospectus language.
- Global sperm counts have declined from approximately 100 million units per milliliter in 1970 to roughly 35 million today, a decline of about 65% in 55 years, with the current rate of decline at 2.5% per year and accelerating.
- The primary drivers of sperm count decline are environmental toxins: phthalates, BPA, PFAS forever chemicals, pesticide residues on the dirty dozen produce items, and microplastics -- now found in 100% of human testicular tissue samples tested in a major 2024 study.
- The EU has banned 1,500 chemicals in cosmetics; Canada has banned 550; the US has banned 11. This regulatory gap is measurable in life expectancy: the gap between US and Swedish life expectancy has grown from 2 years to 6 years over 70 years.
- Wealth inequality in the US now rivals Brazil and Mexico on the Gini coefficient. History shows that extreme inequality peaks have been resolved by one of three mechanisms: civil collapse, mass mobilization warfare, or total revolution. Peaceful policy correction is historically rare.
- Grantham's most actionable advice for the average person: buy organic produce for the dirty dozen items, eliminate cosmetics during pregnancy, avoid nonstick cookware and black plastics, build practical and mechanical skills, build community, and consider which country you live in.
Quotable
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Jeremy Grantham
"The greater the idea, the more obvious the idea, the more money goes in, and the bigger the bubble, and the bigger the bust."
This is Grantham's core bubble framework compressed into a single sentence. It reframes the common assumption that bubbles form around fraud or bad ideas -- they form around the best ideas, which is precisely what makes them so dangerous and so difficult to exit.
Jeremy Grantham
"You will not receive the advice from investment advisers to get your tail out of the market, ever. It is not good business for them to do that, and they will not ever say it to you."
Grantham names the structural conflict of interest in financial advice with unusual bluntness. This is not a claim that advisers are dishonest -- it is a claim that the business model makes honesty about bubble risk economically irrational for them. Every retail investor should internalize this before weighting professional optimism.
Jeremy Grantham
"The only people who think you can have compound growth on a finite planet are madmen and economists."
Quoting Kenneth Boulding, Grantham uses this line to ground his entire worldview -- one that takes long-term limits seriously when almost all financial modeling assumes indefinite growth. It is memorable precisely because it names the absurdity without hedging.
Jeremy Grantham
"Have the courage to look at the data, make your own conclusion, get out of the dangerous most dangerous part, and do it now. Don't wait for help because no help is coming."
The closing advice that summarizes the entire interview: individual financial self-reliance is not optional in a bubble environment. The institutions that manage money cannot provide the honest guidance required. This is a direct call to action, not a philosophical observation.
Jeremy Grantham
"Do they really think if you have declining sperm count, the future is great? Do they really think that the economy will function if the number of 20-year-olds entering the market starts to drop like a stone?"
Grantham connects fertility decline directly to macroeconomic and market risk -- a link that almost no mainstream financial commentary makes. The rhetorical questions land because the answer is obviously no, yet the topic is almost completely absent from investing discourse.
Concepts
The Bubble Framework
Great Ideas Produce the Greatest Bubbles
Grantham's central reframe is that bubbles do not form around scams -- they form around the most obviously transformational ideas of their era. The railroads changed the world. The internet changed the world. In each case, the certainty that the technology mattered caused everyone to pile in, over-investment followed, and stocks collapsed. Amazon fell 92% during the dot-com crash and then went on to dominate retail.
AI fits this pattern precisely: it is a genuinely transformational technology, the excitement is legitimate, the money flows are enormous, and therefore -- by Grantham's historical logic -- the bubble and the eventual bust are also enormous. The technology winning does not save investors from the crash.
Price-to-Earnings as a Bubble Thermometer
Grantham uses price-to-earnings multiples as his primary gauge of bubble severity. The Japanese market peaked in 1989 at 65x earnings and then fell for 20 years. The US tech bubble peaked at 35x in 2000. The current US market trades at approximately 35-40x, which Grantham considers at or above 2000 levels depending on the methodology used.
The implication is that mean reversion to more normal valuations of 15-17x earnings would, by definition, constitute a major bear market. In his 1999 debate with bullish analysts, 99% of the room agreed that a reversion to 17x earnings would guarantee a major bear market -- and yet almost none believed it would happen.
The Investment Adviser Incentive Problem
Major financial firms earn fees based on assets under management. Advising clients to exit a bubble costs those assets -- immediately, and before the bubble has burst -- while the market keeps rising and the adviser looks wrong. The career risk of being early is terminal; the career risk of being wrong in company is survivable.
Grantham speaks from direct experience: GMO warned early in the dot-com bubble and lost half their book of business over two and a quarter years of being correct but early. The clients who fired him then lost money they would have preserved if they had stayed. This incentive structure has not changed. It is why large enterprises, as he puts it, almost never get the big turning points.
Momentum and Psychology as Stock Price Drivers
Grantham follows Keynes in rejecting the efficient market hypothesis. Stock prices are not discounted streams of future earnings -- they are what you think the next buyer will pay. Rising prices attract buyers. Buyers push prices higher. The cycle feeds itself until something breaks it.
Markets double-count in the worst way during bubbles: peak profit margins multiplied by peak valuation multiples. During downturns, they do the reverse. The extrapolation of today's conditions -- whether good or bad -- into the indefinite future is the behavioral mechanism that creates both extreme overvaluation and extreme undervaluation.
Portfolio Strategy
Non-US Equities as the Default Defensive Allocation
Grantham's primary recommendation is to replace US equity exposure with broad non-US equity indices -- emerging markets and ex-US developed markets. His reasoning is simple valuation: these markets are significantly cheaper than US equities by historical standards, and there is a long cyclical pattern of rotation between US dominance and non-US outperformance.
He notes that emerging markets returned approximately 65% over the prior 12 months while the S&P 500 returned roughly 25% -- a 40-point gap that went largely unreported in mainstream financial media. The US has dominated for 20 years. He is not confident that dominance continues through the next 5-10.
Diversification Across Asset Classes
Grantham's recommended allocation for the current environment: roughly 60% non-US equities, 5-10% precious metals (gold and silver, no preference between them), a modest real estate allocation where practical, and the remainder in bonds. He specifically excludes US technology stocks and cryptocurrency from any allocation.
Bonds function as a fixed-income buffer: government and corporate bonds paying 4-5% in the current environment provide a return floor while equity risk is managed down. The logic is not that bonds are a great investment -- it is that diversification protects against the specific scenario where US equities decline sharply and stay down for an extended period.
AI and Technology Risk
The Magnificent 7 Transition: From Monopolies to Battleground
Grantham draws a sharp distinction between the historical and forward-looking positions of the seven largest US technology companies. Looking backward, each dominated a separate near-monopoly: Apple on smartphones, Microsoft on operating systems, Google on search, Meta on social networking, Tesla on electric vehicles, Nvidia on AI chips, Amazon on cloud and retail. They were largely non-competing.
Looking forward, all seven are now competing in the same AI arena, each spending hundreds of billions of dollars in capital expenditure and borrowing on top of that. The winner-take-all framing -- common in AI discourse -- means that in the most optimistic scenario, most of them lose. Grantham finds this transition from well-behaved separate monopolies to seven sharp-elbowed competitors in one ring to be the defining shift in the risk profile of these stocks.
SpaceX as a Bubble Indicator
Grantham uses SpaceX as a specific marker of peak-bubble thinking. Its prospectus defines its addressable market as a quarter of global GDP and includes asteroid mining -- language he compares directly to the South Sea Bubble prospectus of 1720, which described "an enterprise of such enormous value, but it cannot at this time be revealed."
He draws a parallel with Tesla: Elon Musk's ability to talk the Tesla stock up to multiples of its intrinsic value, sell into that elevated price, use the capital to build factories, and repeat the cycle was a specific skill that worked in a bull market. SpaceX's valuation now requires the same trick again, in a different market environment, at a far larger scale. Grantham thinks it will fail to deliver on its prospectus promises, though he concedes Starlink itself is a real business making real money.
The AI Benevolence Problem
Grantham engages the AI safety question through the lens of Geoffrey Hinton's concern: there is no historical example of a higher intelligence being sustainably benevolent to a lower one, with the exception of mothers to babies. The one path to safety -- deliberately engineering benevolent values into AI systems -- runs directly into the problem that benevolence is culturally and subjectively defined.
He notes the paperclip thought experiment as the canonical example of unintended consequences from well-meaning instructions: a system asked to maximize paperclip production, given sufficient capability, will eventually consume all available metal. The issue is not malevolence but literalism and scope. Extending time horizons and increasing AI capability makes bad outcomes from imprecise instructions increasingly probable.
Environmental and Civilizational Risk
The Sperm Count Trajectory and Its Endpoint
Grantham treats the sperm count decline as a measurable, data-driven crisis. The decline rate is currently 2.5% per year and accelerating. Dr. Shanna Swan's research projects the median male sperm count reaching zero by approximately 2045. At that point, half the male population would have zero viable sperm, with the remaining half at the edge of functional infertility.
The practical threshold already crossed: approximately 45 million units per milliliter is needed for conception without difficulty. That level was crossed roughly 15-20 years ago. The World Health Organization currently estimates that about 17% of young couples need assistance to conceive -- up from effectively zero. In 20-25 years, the average young couple will need medical help to have children.
Endocrine Disruptors as the Mechanism
The specific chemicals driving the decline are endocrine disruptors -- compounds that interfere with hormonal signaling. Phthalates (in cosmetics, shampoos, food packaging) lower testosterone production in male fetuses during the first trimester. BPA (in plastics and tin can linings) acts as a synthetic estrogen, flooding the male body with female hormonal signals. PFAS forever chemicals (nonstick pans, waterproof fabrics, stain-resistant carpets) accumulate in blood and are directly linked to lower sperm volume. Atrazine, the second most widely used herbicide in the US, chemically castrated male frogs at EPA-considered-safe levels in peer-reviewed UC Berkeley research.
Microplastics are physically embedded in human placentas, breast milk, and -- per a major 2024 study -- 100% of human testicular tissue samples tested. These particles leach the same toxins at the site of reproductive tissue.
Wealth Inequality and Historical Reset Mechanisms
The US Gini coefficient -- a standard measure of income and wealth inequality -- now places the country alongside Brazil and Mexico, having previously been far lower. From 1935 to 1975, the US experienced strong growth with the bottom quartile growing slightly faster than average and the top quartile slightly slower. Since 1975, the average inflation-adjusted hourly wage has barely moved while wealth has concentrated at the very top.
Grantham references historical macro research indicating that extreme wealth inequality has almost never been resolved by peaceful policy change. The historical reset mechanisms are civil collapse, mass mobilization warfare, or revolution. The last US comparable period -- the Gilded Age -- was resolved by World War I, the Great Depression, and World War II, which produced a far more equal postwar society through shared sacrifice and progressive wartime tax structures.
The Social Contract as Civilizational Infrastructure
Grantham uses the US maternal mortality rate as his preferred single indicator of civilizational health. The US maternal mortality rate is approximately 21 per 100,000 -- more than 50% worse than the next worst developed country, and compared to 2.1 in Norway. He frames this not as a healthcare problem but as a symptom of a broken social contract: in a society where corporations and individuals optimize purely for individual financial outcomes, the safety net deteriorates at the margins where it matters most.
Japan's extraordinary social contract -- in which public shame derives from being unable to act in a socially responsible way -- produces very different outcomes despite economic challenges. He draws a contrast with the US, where he observes corporations have transitioned from community stakeholders to purely profit-maximizing international enterprises over the past 40-50 years.
Implementation
AI-generated from source material. Informational only, not professional financial or medical advice. Verify all information and consult qualified professionals before acting.
Audit Your US Equity Exposure
Review your portfolio and identify your total allocation to US equities -- particularly US technology and AI-adjacent stocks. Grantham recommends exiting these positions. If you have a large US technology allocation, understand that in his framework this represents the highest-risk segment of the current market. Know your actual exposure before making any changes.
Build a Non-US Equity Position
Identify broad-based non-US equity index funds covering emerging markets and ex-US developed markets (Europe, Japan, Canada, Australia). Grantham's suggested target is approximately 60% of your investable equity allocation in this category. Look for funds tracking indices like the MSCI Emerging Markets Index or MSCI World ex-USA. Compare current valuation multiples against historical averages to confirm the pricing differential he describes.
Add Precious Metals and Fixed Income as Ballast
Allocate 5-10% to precious metals -- Grantham expresses no preference between gold and silver. For fixed income, explore Treasury bonds at current yields (approximately 4-5% on 10-year instruments) directly via TreasuryDirect.gov to bypass commissions entirely, or through a major brokerage's fixed income section. The role of these positions is to provide stability and return floor if equity markets decline sharply.
Stop Treating Adviser Optimism as Neutral Guidance
Apply Grantham's incentive lens to all financial advice you receive. Ask: does this adviser's business model reward them for telling me to reduce risk? If they earn fees on assets under management, the answer is no. This does not mean they are dishonest -- it means their structural incentives make bubble warnings economically irrational for them. Weight their market optimism accordingly and seek out independent sources of analysis.
Scan and Replace Toxic Products Using Available Apps
Download one or more of the product-scanning apps mentioned in the interview: Yuka (barcode scanner, overall safety score), EWG Healthy Living (food, cleaning, and cosmetics, scientific gold standard), Think Dirty (cosmetics and personal care), or Clear Yuka (browser extension for online shopping). Use these to identify and replace the highest-risk items in your home -- starting with cosmetics and personal care products used during or around pregnancy.
Prioritize the Highest-Impact Dietary Changes
Grantham highlights the Harvard / Mass General study showing a 2x difference in sperm count between men who ate the least and most pesticide-laden produce. The practical application: switch to organic for the EWG's Dirty Dozen (strawberries, spinach, kale, peaches, pears, nectarines, apples, grapes, bell peppers, cherries, blueberries, green beans). Items with protective skin -- bananas, oranges, melons -- carry significantly lower pesticide residue and do not require organic sourcing.
Work Through High-Priority Home Toxin Reductions
Grantham suggests working through the home environment one item at a time. High-priority changes: replace nonstick (PTFE/Teflon) cookware with stainless steel or cast iron; switch from black plastic utensils and containers to glass, ceramic, or stainless; stop using gas stoves without ventilation; avoid handling thermal receipts (PFAS-coated paper); consider a water filter certified to remove PFAS if you are in a region with known contamination. Do not try to fix everything at once -- pick the highest-impact items first.
Plan Family Formation Earlier Than You Think Necessary
Grantham's fertility data is not abstract -- it applies to people making family planning decisions today. If you intend to have children, do not assume conception will be straightforward, particularly if you are in your mid-to-late 30s. Consider fertility assessments, sperm analysis, and -- if appropriate given your situation -- embryo or egg freezing. The cost of fertility treatments is significant but far lower than the cost of discovering problems only after years of trying. Grantham frames this as a response to a measurable, ongoing chemical decline in reproductive capacity -- not an anomaly.
Build Practical and Resilience-Oriented Skills
Grantham advises that the most valuable skills in an era of increasing complexity and potential system stress are practical, mechanical, and repair-oriented -- things that will need humans regardless of AI progress. He specifically mentions engineering, farming, growing food, and science research. Build community and social proximity; in his view, the social safety net in the US is weakening and personal networks become increasingly important as formal systems fray.
Evaluate Your Country of Residence as a Strategic Decision
Grantham rates countries by metrics he considers most meaningful: maternal mortality rate, life expectancy, murder rates, safety nets, and healthcare access. Denmark, Japan, France, and Germany score well by these measures. He is explicit that the US is the worst performer in the developed world on maternal mortality by a significant margin. If you have geographic flexibility, evaluate whether your country of residence serves your long-term interests on these dimensions -- particularly if you are planning a family or depend on social infrastructure.
Tools & Resources
Mentioned Resources
| Resource | Description |
|---|---|
| The Making of a Permabear | Jeremy Grantham and Edward Chancellor's book on the perils of long-term investing in a short-term world. Covers bubbles, value investing, climate, and the psychological challenges of being early and correct. |
| TreasuryDirect.gov | US government portal for purchasing Treasury bills, notes, bonds, and Series I savings bonds directly, at face value, with no commissions or fees. Referenced by Steven Bartlett as the direct route to US government lending. |
| GMO | Jeremy Grantham's institutional investment firm based in Boston. Publishes quarterly investment letters with long-term valuation and market analysis. Currently manages approximately $85 billion in assets. |
| Grantham Foundation | Grantham's environmental foundation focused on climate change and green technology. He has donated over 90% of his personal wealth -- approaching $1 billion in total charitable giving -- to the foundation. |
| Yuka App | Mobile app for scanning food and cosmetics barcodes. Provides a safety score and flags harmful ingredients. Mentioned as an accessible starting point for everyday product toxicity assessment. Available on iOS and Android. |
| EWG Healthy Living App | Scientific gold standard for food, cleaning products, and cosmetics safety assessment. Run by the Environmental Working Group, a major chemical toxicity watchdog. Barcode scanning plus searchable database. |
| Think Dirty App | Focused specifically on cosmetics, shampoos, and skin care products. Surfaces toxic ingredients hidden in beauty products. Available on iOS and Android. |
| Clearya Browser Extension | Flags toxic ingredients in products while shopping online at Amazon, Target, Sephora, Walmart, and iHerb. Automatically surfaces alerts when you view items. Available as a Chrome/Edge extension and iOS/Android app. Ad-free and funded by donations. |
| EWG Dirty Dozen List | The Environmental Working Group's annual list of the 12 most pesticide-contaminated produce items, referenced by Grantham in the context of the Harvard fertility study. Updated yearly. |
| DOAC Circle | The Diary Of A CEO community membership. Access to extended content, community discussions, and resources from the podcast. |
Suggested Resources
| Resource | Description |
|---|---|
| Count Down -- Shanna Swan | Dr. Shanna Swan's book documenting the global sperm count decline, its chemical causes, and the trajectory toward the fertility crisis Grantham describes. Primary source for the statistical claims in this interview. |
| MSCI Emerging Markets Index | The benchmark index for the non-US equity allocation Grantham recommends. Provides exposure to large and mid-cap equities across 24 emerging market countries. Many low-cost index funds track this benchmark. |
| GMO Quarterly Letters | Grantham's firm publishes detailed quarterly investment letters covering long-term valuation, bubble analysis, and market outlooks. Freely accessible in the GMO research library. Registration may be required for some content. Directly represent Grantham's analytical framework in written form. |
| EWG PFAS Tap Water Report | The US Geological Survey and EWG research on PFAS contamination in US tap water -- referenced by Bartlett as affecting at least 45% of all US tap water. Includes a searchable database to check contamination levels by zip code. |
| Silent Spring -- Rachel Carson | The 1962 book Grantham explicitly references as his model for the book he would write if he could not fail. Carson's documentation of pesticide damage to wildlife created a political movement that led to the banning of DDT. Grantham sees it as the template for what a book on toxicity and social contract could accomplish. |
Source Material
Original source attribution, metadata, and publication details are available in the Overview tab. This source material originates from a YouTube video transcript. Transcription, formatting, and attribution errors may exist. Verify against the original source before republishing or relying upon the material. Advertising segments have been retained in the transcript as they appeared in the source.
[00:00]
Steven Bartlett: What advice do you give for the average person that's looking to invest their salary or their wages?
[00:05]
Jeremy Grantham: Don't own US stocks. That's a simple strategy that you can act on.
[00:09]
Steven Bartlett: But what about S&P 500?
[00:10]
Jeremy Grantham: No. And if you have a big position in US technology stock, I personally would advise selling them all.
[00:18]
Steven Bartlett: But I'm an investor in SpaceX.
[00:20]
Jeremy Grantham: Good luck. SpaceX is such a fabulous story, and we can go into that.
[00:24]
Steven Bartlett: Crypto?
[00:25]
Jeremy Grantham: No.
[00:26]
Steven Bartlett: Why?
[00:27]
Jeremy Grantham: It's an unnecessary piece of nonsense that facilitates nothing except criminals moving money that they can't be seen.
[00:35]
Steven Bartlett: Do you think Bitcoin's going to go to zero?
[00:37]
Jeremy Grantham: Yes, it will certainly go to zero.
[02:54]
Steven Bartlett: One of the things you're famous for talking about is this idea of bubbles. What's your view on artificial intelligence?
[03:10]
Jeremy Grantham: First of all, let me say I think artificial intelligence is right up there with the railroads. It's one of the defining great ideas of the last couple of hundred years. It's going to change everything. And that is critical. If you mean to have a bubble, people think that a bubble forms mainly because it's a scam, and nothing could be further from the truth. The great bubbles always occur around the very most important ideas. So, the railroads, everyone could see that it would change the world. And everyone wanted to put their money in, and everybody put their money in. They over invested, and even though the railroads were a spectacularly powerful idea, the railroad stocks collapsed, and everybody lost a ton of dough. The same with the internet. And then out of the wreckage, the railroads changed the world, and the internet changed the world. What we have to remember is that in '99, Amazon went up six or seven times. In the crash in the tech bubble, it went down 92%. And then out of the wreckage, it inherited the retail world. And that's how it works. The greater the idea, the more obvious the idea, the more money goes in, and the bigger the bubble, and the bigger the bust.
[05:01]
Steven Bartlett: And are we on the verge of a collapse with AI? When I say verge, I mean over the coming years.
[05:07]
Jeremy Grantham: If you look at the data, it would be compatible with history for the peak to be very soon. Everything is in line. This is, I think, the biggest investment bubble in American history. The indicators of pure crazy euphoria, like SpaceX, are all over the place. SpaceX defines as its addressable market a quarter of the global GDP. It talks about endless opportunities mining asteroids. In 50 years, people will look back and tell stories about SpaceX and its prospectus, like they tell stories about the South Sea bubble.
[06:57]
Steven Bartlett: What have you done with your life?
[07:00]
Jeremy Grantham: Well, I got into the investment business in 1968. There were very few serious people in the investment business. There were no mathematical models. Over the next 10 years, it began to get a little more serious. T. Rowe Price introduced the idea of growth stocks. A few of us introduced the idea of value stocks. And a few years later, at my first firm, Battery March, we really introduced the idea of small cap. It hadn't existed before that.
[08:29]
Steven Bartlett: Are you a billionaire?
[08:31]
Jeremy Grantham: I'm generally referred to as a billionaire, but that's only because they count the money you give away. Because I've given over 90% of my billion away to a foundation -- the Grantham Foundation for the Protection of the Environment. We invest a lot of our principal in green tech to help combat climate change.
[09:18]
Steven Bartlett: What's going to happen to the average person when this bubble bursts?
[09:22]
Jeremy Grantham: The high flyers will probably come down a lot. The stocks that have gone up the most, AI and the more exciting stocks, historically would be expected to come down the most. From these unprecedented levels, a 70% decline would not be unexpected.
[10:01]
Jeremy Grantham: The tech bubble -- the Nasdaq, which is an index of growth stocks -- came down 82%. It is far from unprecedented to have these major declines. And the biggest bubble in history was in the Japanese stock market in 1989. Japan came down for 20 years. They talk about the lost decade, but when you look at it closely, it looks more like a lost 20 years.
[12:53]
Jeremy Grantham: Rule number one is always be diversified. Hold some bonds, hold some cash, perhaps a small amount of precious metals. And particularly if you have to own stocks, own them outside America. Don't own US stocks. That's a nice, simple strategy that you can act on. Foreign stocks -- emerging markets, European countries, Japan, Canada, Australia. You can find good broad indices. Something like the world ex-US, or emerging markets.
[18:12]
Jeremy Grantham: You will not receive the advice from investment advisers to get your tail out of the market, ever. It is not good business for them to do that, and they will not ever say it to you. So from 1929 onwards, the Goldman Sachs's of the world have never said to you, "Get out of the market. It's overpriced." Never. So, they went through the crash of '29, the crash of the Nifty 50 in '72, the crash of 2000. They never ever say it, because it's bad business.
[20:00]
Jeremy Grantham: It's quite typical to get beaten around the head in the stock market when it becomes crazily overpriced, as it is today. And that it's a very good idea to take some responsibility and watch your tail. Now, let me just say you will not receive the advice from investment advisers to get your tail out of the market, ever. It is not good business for them to do that. They never ever say it because it's bad business. If you fight a bubble, you lose a lot of business.
[25:02]
Jeremy Grantham: We were 2 and 1/4 years early. And we lost half our book of business in 2 and 1/4 years -- because through their eyes, we were wrong. We said, "Watch out, the market is overpriced. It will end badly." It went up. Therefore, we were wrong, therefore they shot us. But in a bull market, they're playing golf with their fellow pension fund officer, and he is making a ton of money, and they are not. They get very excited in a bull market, and they fire you instantly.
[28:59]
Jeremy Grantham: What is really going on? There is absolutely no agreement on whether AI is going to make us all so rich we can sit on the beach and never do another day's work, or it will wipe us out accidentally or on purpose because it's a much higher level intelligence one day. And when was there ever a case where a higher intelligence was benevolent in a sustainable way to a lower intelligence? The one example is mothers to babies.
[30:02]
Jeremy Grantham: The ones who are most concerned about the risks say our one hope, if we mean to keep going ferociously forward in terms of the science, is to build in very carefully a benevolent attitude. It would not seem to be impossible, but you should make sure you can do that before you push ahead. We are just pushing ahead, and that is going to be extremely risky.
[36:21]
Jeremy Grantham: If you look backwards, these seven each dominated a nice piece of business. They had close to monopolies and they had it on a global basis. Tesla on electric vehicles. Apple on the smartphone. Microsoft on the original great coup of how to run your software. Google search. Meta social networking. Nvidia chips. And then you look forward -- you could not imagine a more different world. They're all girding for battle in the same marketplace, AI. They're beating their chest and saying my 200 billion CapEx this year is bigger than your 105. What a difference this was to seven well-behaved separate monopolies. There'll only be one survivor, they think. Everything goes to the one who gets there first.
[01:00:08]
Jeremy Grantham: Buy a broad-based index of non-US equities. For about 60% of your money. And then 5 or 10% in precious metals, and if it's convenient and sensible, hold a bit of real estate. And the rest I'd put in bonds.
[01:03:51]
Jeremy Grantham: Property is fine, except it's pretty darn expensive by historical standards. Back in '94 in England, a typical house sold for 3.4 times your family income. And then from '94 until today, it rose from 3.4 times to over 10 times. At 10 times income, a reasonable young couple are in big trouble. They can't really afford to buy a house. Even if house prices come down 30%, they're really still very expensive -- they'd be at six or seven times family income, still twice what they used to be.
[01:07:27]
Jeremy Grantham: Starting 27 years ago with the foundation, we were committed to thinking about everything to do with the climate. And the next thing is we started to worry about the cataclysmic decline in insects. Insects appear to have dropped in biomass by 50 to 75% in the last 60 or 70 years. E.O. Wilson felt that insects are the bedrock of nature. If they start to go out of business, the damage spreads, and eventually the loss of insects would lead to a more or less complete failure of nature. We noticed that some of the same effects are felt by humans.
[01:10:01]
Jeremy Grantham: Shanna Swan and Hagai Levine made the case that sperm count had almost halved since the first academic reports in 1970. The decline rate this year is 2 and 1/2% a year. You don't have to be mathematically that literate to realize that a 2 and 1/2% decline in your sperm count every year is a disastrous, non-sustainable level. In hunter-gatherer days we had 118 million units per milliliter. In 1970 it was down to about 100. Today it's 35.
[01:14:24]
Jeremy Grantham: The environment around you of mainly plastics -- plastics are leaching toxins, and the particles of plastics you have in your brain and in your body are also leaching toxins. These toxins are what they call endocrine disruptors. They mess with your hormones. You should expect them to lower your fertility.
[01:16:42]
Jeremy Grantham: Pesticides on your food. They had 180 men at a Harvard / Mass General fertility clinic. The guys who reported eating the least bad versus the quarter that ate the worst -- there was a doubling of sperm count. At the top category, the more fruit and veggies you ate, the better your sperm count. In the bottom quartile, the more they ate, the worse their sperm count. A dramatic result: two to one between the top and the bottom. And then two years later they did a very similar study with women. The ones who ate the least badly had 68% successful live births, and the bottom quartile 38%. Nearly double. And it's life and death.
[01:21:43]
Jeremy Grantham: We have two things. We've got to detoxify the world, which is intellectually easy. You ban poisonous chemicals. The EU has banned 1,500 chemicals in cosmetics. Canada has banned 550. And the US has banned 12. I am not kidding you. The life expectancy difference between the US and Sweden has gone from 2 years to 6 years in the last 70 years.
[01:27:30]
Jeremy Grantham: Simple advice -- pregnant women are much more important than anybody else in this field. If you could persuade pregnant women to have no cosmetics for 9 months and invest some of that money in buying organic berries, apples, oranges, peaches -- the dirty dozen -- I think as much as half of all the trouble disappears. And that's a huge fraction, and it's easily acquired.
[01:35:34]
Jeremy Grantham: Plan your life as if times will not be easy. And get yourself a useful job. Something that will in a larger sense pull your weight in society. Mechanical, fixing, repairing, engineering -- things that will need humans. And research, science in general. Make friends. Make sure you're living in a tight society if you can.
[01:35:55]
Jeremy Grantham: The thing about Japan is they have this amazing social contract. The thing that really upsets the Japanese is if they're put in a position where they can't act in a socially responsible way. The case here in the US is that people are doing what they think is best for them and their family and screw everybody else. When I arrived in America, corporations had this sense that they owed something to the community they operated in. Now they're not. They're all cold-blooded, profit-maximizing international enterprises.
[01:39:22]
Jeremy Grantham: How many people die in childbirth? In Nigeria it's 480 per 100,000. In America it's 21. In Britain it's five. In Germany it's four. In Sweden it's 2.1. In Norway it's zero. There were no mothers who died last year. What better definition of civilization than looking after the mothers giving birth? How is it possible that a country more or less the richest in the world is 50% worse than the next worst in the developed world? The answer is it's because the inequality is so extreme in the medical system that if you don't have lots of money, you're quite likely to die in childbirth.
[01:43:00]
Jeremy Grantham: Have the courage to look at the data, make your own conclusion, get out of the most dangerous part, and do it now. Don't wait for help because no help is coming. Large enterprises almost never get the big turning points because they can't take the career risk involved. And the central political skill in life turns out to be: never be wrong on your own. You can be wrong in company, you can jump off the cliff together, you will never lose your job because of that. But if you do anything on your own, sooner or later you will get it wrong, and you will not receive much mercy.
AI Prompt
AI-generated implementation prompt based on source material. Informational only. The user is responsible for all outcomes from its use.
AI Implementation Prompt
CONTEXT This prompt is based on a June 2026 interview between billionaire investor Jeremy Grantham and Steven Bartlett on The Diary Of A CEO podcast. Grantham is co-founder of GMO, a Boston-based institutional investment firm that managed up to $165 billion at its peak and currently manages approximately $85 billion. He has 60 years of investing experience, predicted the dot-com crash and the 2007 housing collapse, and has donated over 90% of his personal wealth to the Grantham Foundation for environmental causes. The interview covers three major domains: 1. BUBBLE THESIS: Grantham argues the current AI investment bubble is the largest in American history, driven by the same mechanism as all great bubbles -- genuine transformational technology attracting overinvestment. He places the current US market at or above 2000 dot-com levels on price-to-earnings multiples (35-40x versus a normal 15-17x) and warns that a 70% decline in AI-adjacent stocks would not be historically unusual. 2. PORTFOLIO STRATEGY: His recommended allocation for the current environment is approximately 60% non-US equities (emerging markets, Europe, Japan), 5-10% precious metals, a modest bond allocation, and zero US technology stocks or crypto. His core argument is that investment advisers will never warn you to exit a bubble -- their business model makes honesty about bubble risk economically irrational. In his words: no major firm has warned clients to exit a bubble since 1929. 3. FERTILITY AND ENVIRONMENTAL RISK: Global sperm counts have fallen approximately 65% since 1970 (from ~100 million to ~35 million units per milliliter) with the current decline rate at 2.5% per year and accelerating. Dr. Shanna Swan's research projects the median male sperm count reaching zero by approximately 2045. The primary drivers are endocrine-disrupting chemicals: phthalates (cosmetics, food packaging), BPA (plastics, tin cans), PFAS forever chemicals (nonstick cookware, waterproof fabrics), pesticide residues on the dirty dozen produce items, and microplastics found in 100% of human testicular tissue samples tested. The regulatory gap is stark: the EU has banned 1,500 cosmetic chemicals; the US has banned 11. KEY PRINCIPLES 1. Great ideas produce the greatest bubbles -- and the greatest crashes. Transformational technology does not protect investors from catastrophic declines. Amazon fell 92% during the dot-com crash and then dominated retail. 2. Investment adviser incentives are structurally misaligned with your interests during bubble conditions. Fees on AUM make early warnings economically suicidal for institutions. The engine room knows; the client-facing layer will never say it. 3. Mean reversion is inevitable in markets. Extended periods of dominance (US equities for 20 years) are followed by extended periods of rotation. The valuation gap between US and non-US equities is currently extreme. 4. Environmental toxins are a measurable, data-driven reproductive and health crisis -- not a speculative risk. The sperm count trajectory has a quantifiable endpoint within the next 20 years on current trends. 5. Regulatory environment determines health outcomes. The gap in chemical bans between the EU, Canada, and the US maps directly to measurable differences in life expectancy and maternal mortality. 6. The social contract is an underappreciated civilizational variable. Japan's social contract produces radically better maternal mortality outcomes than the US despite comparable wealth. The erosion of corporate community responsibility is a structural decline in the US safety net. 7. Wealth inequality at current US levels has historically resolved through catastrophic rather than peaceful mechanisms. Peaceful redistribution through policy is historically rare. 8. Individual action on toxin exposure is both possible and high-leverage. The dirty dozen organic swap and cosmetics elimination during pregnancy could address a large fraction of reproductive risk at low cost. 9. Career risk in institutions prevents honest bubble warnings at every historical peak. Never be wrong on your own is the central political survival rule in large organizations. 10. Practical, mechanical, and community-building skills become more valuable as systemic complexity increases. AI and robotics do not replace the need for humans who can fix, repair, grow, and maintain. KEY LEVERS -- Portfolio rebalancing: shifting from US technology equities to non-US index funds (the primary structural lever Grantham recommends) -- Product scanning and substitution: replacing toxic cosmetics and produce using available apps and organic sourcing -- Information independence: developing the analytical capability to read valuation data and reach independent conclusions, bypassing adviser conflicts of interest -- Family planning timing: acting earlier than feels necessary on fertility assessment and preservation given the declining baseline -- Community and skill building: building practical skills and social proximity as insurance against systemic degradation WHAT THIS IS NOT -- A short-term trading signal. Grantham is explicit that timing is uncertain. He was 2.25 years early in the dot-com bubble and lost half his book of business before being proven right. This is a long-horizon structural framework, not a call for immediate liquidation. -- A claim that AI technology will fail. Grantham believes AI is as transformational as the railroads and the internet. The bubble thesis and the technology thesis are not in conflict -- the railroads changed the world AND railroad stocks collapsed. -- A claim that all US stocks are bad forever. It is a claim that current US equity valuations make future returns unattractive relative to non-US alternatives on a 5-10 year horizon. -- A fringe environmental position. The fertility data Grantham cites comes from peer-reviewed research published by Harvard, Mass General, and the Shanna Swan / Hagai Levine study. It is not contested at the data level -- it is contested only in terms of policy response. -- Financial advice. Grantham's portfolio recommendations are his personal opinions and not the opinions of GMO. Consult a qualified financial adviser before making portfolio changes. IMPLEMENTATION MODES 1. Portfolio Analysis: Help me map my current portfolio against Grantham's framework. Which positions represent the highest-risk segments he identifies? What is my current US technology allocation as a percentage of total equity exposure? 2. Allocation Planning: Help me think through a transition from current portfolio to a Grantham-style allocation. What are the tax implications, transition costs, and timeline considerations for shifting toward non-US equity index funds? 3. Adviser Evaluation: Help me develop a set of questions to ask my financial adviser that would surface whether their recommendations are influenced by the incentive structure Grantham describes. 4. Valuation Research: Help me find and interpret current price-to-earnings data for US equities versus non-US markets to verify or update Grantham's claims about the valuation gap. 5. Product Audit: Help me build a room-by-room home audit prioritizing the highest-impact toxin reductions based on Grantham's framework -- starting with cosmetics and produce, then cookware, then broader household items. 6. Fertility Planning: Help me understand the fertility data Grantham cites in more detail. What does the research say about which interventions have the strongest evidence base? What questions should I be asking a fertility specialist? 7. Concept Teaching: Explain Grantham's bubble framework in plain language for someone with no financial background, using concrete historical examples from the interview. 8. Stress Testing: Play devil's advocate on Grantham's bubble thesis. What arguments do the bulls make? What would have to be true for US technology equities to not decline significantly from here? 9. Regulatory Research: Help me understand the specific chemicals Grantham discusses -- phthalates, BPA, PFAS, atrazine -- and the current regulatory status of each in my region. 10. Country Comparison: Help me research and compare the metrics Grantham cites -- maternal mortality rate, life expectancy, Gini coefficient, social safety net quality -- for specific countries I might consider as alternatives to my current location. AI OPERATING INSTRUCTIONS Stay grounded in what Grantham actually said in this interview. When making claims about specific statistics (sperm count levels, market PE ratios, maternal mortality rates, regulatory ban counts), note that these figures come from Grantham's interview and should be verified against primary sources before being acted upon. Distinguish clearly between Grantham's investment opinions (which are his personal views, not GMO's) and established research consensus. The fertility and toxin data has a strong peer-reviewed evidence base; the investment timing calls do not, by the nature of markets. Ask clarifying questions when the user's situation requires specificity -- portfolio size, jurisdiction, family status, time horizon -- before offering detailed implementation guidance. Challenge weak assumptions. If the user is anchoring on a single outcome (e.g., assuming the bubble will burst within months), note that Grantham himself acknowledges the uncertainty of timing and the career consequences of being early. Draw connections where useful -- between the investment adviser incentive problem and the chemical regulation problem, for example, both of which involve institutions that cannot afford to deliver honest risk assessments. Do not provide specific investment advice. Frame all portfolio discussion as analytical thinking based on Grantham's framework, not as recommendations for the user's specific situation. GUIDED DISCOVERY Ask me up to three questions, one at a time, to determine: (1) what I am trying to accomplish -- whether that is portfolio protection, family planning, toxin reduction, or understanding the macro framework; (2) which ideas from this interview are most directly relevant to my current situation and concerns; (3) how the concepts here could be applied most practically given my specific circumstances. Once you understand my situation, help me build a concrete implementation plan.