|Somalian Refugees/US Navy|
|Union Jack and EU Flag|
He begins with calling the current economic (i.e. central banks' policies) and political developments (i.e. Brexit) as "Black Hole Experiments in which the further we push them, the more the laws of physics, finance, or politics begin to change in unknowable ways."
Even though we are experiencing these unusual political times, and even though Grantham believes assets are overpriced, he expects the (US) stock market for the time being to keep rising thanks to what he calls the "two remarkable pillars of support", which are the continuing Fed's policy of low interest rates and the US corporations buying back their stock.
Furthermore, although he believes Brexit will be bad for the UK economy, it could turn out to have a positive effect by stimulating the EU to reconsider its many weaknesses. But more importantly Grantham believes Brexit is an indication of how problematic immigration from outside Europe can become. He then comes up with an in my view very important statement about social cohesion in society. This is something that many European politicians and policymakers seem to forgot about or take for granted. Grantham states: