In this second part of his interview with the Master Investor Podcast, Jeremy Grantham discussed the long-term threats facing humanity—and by extension, the markets. “This is not gradual. This is catastrophic,” Grantham says, capturing the urgency of his message. While markets celebrate record highs, he points to underlying crises—toxicity, climate change, and population decline—that investors ignore at their peril.
Grantham’s concerns about toxicity are particularly striking. “We live in a kind of toxic stew,” he notes, highlighting the proliferation of chemicals since World War II.
Pesticides, designed to kill, may be harming humans in ways we are only beginning to understand. “They are designed to kill our cousins, the insects… It shouldn’t be that unlikely that these things designed to kill great swaths of life would be damaging for humans.”
The evidence is alarming: endocrine disruptors are linked to declining sperm counts, which have fallen from 100 million units per milliliter in the 1970s to 35 today. “Every survey of sexual activity in every country, every age group is dropping like a stone,” Grantham observes. The consequences are dire: “In 20 years, the average young couple will need help getting pregnant.”
This ties directly into his second major concern—population decline. “Global populations will decline significantly,” he predicts, citing The Lancet’s projection of 6 billion by 2100, far below UN estimates.
The economic implications are profound. “The workforce has been dropping in Europe for nearly… 15 years. This takes a big bite out of GDP growth.”
Grantham dismisses American exceptionalism, noting that immigration and fracking—not superior policies—explain the U.S.’s relative outperformance. “The main difference is that they in the US have had significantly more immigration… and moderately more fertility.”
On climate change, Grantham strikes a cautiously hopeful note. “If we rise to the occasion, which we just may… we could hit a carbon zero economy.” Yet, he acknowledges the political hurdles: “It’s a political will and… the huge power of the vested interest behind pollution.”
Even so, he warns that population decline is already reshaping economies. “There is no chance we are not fairly well into a population crash.” Japan’s plummeting birthrate—from 2.5 million babies in 1948 to under 700,000 today—illustrates the trend. “This is not theoretical, guys. This is happening.”
Grantham’s conclusion is a damning indictment of human nature. “We have such a desperate predisposition for good news.” Amid nuclear threats, climate crises, and demographic collapse, the market’s optimism feels surreal. “At a time like this, to find yourself facing the most optimistic bull market in American history is really a very interesting testimonial to human nature, isn’t it?”
You can watch Part 2 of the interview here:
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