Billionaire investor Jeremy Grantham said Friday that the U.S. stock market has reached its most expensive valuation in American history [1].
Grantham's warning suggests that the current equity surge is unsustainable, signaling a potential systemic risk to investors who have relied on the recent growth of technology stocks.
During an interview on CNBC’s “Squawk Box” on June 26, 2026, the co-founder of GMO said, "This is the most expensive market in American history" [1]. Grantham said that the market could suffer a steep correction if the current bubble bursts, with a potential decline of up to 70% [4].
He attributed the record price levels to soaring AI-driven valuations [5]. While Grantham said in May that AI was the only thing preventing a recession and a market crash [2], he now suggests those same valuations have pushed the market into a dangerous bubble [4].
Beyond the equity markets, Grantham expressed a bleak outlook for digital assets. He said during the CNBC appearance that "Bitcoin will dwindle away with a whimper" [1].
Grantham has a history of identifying market bubbles, and his current focus on AI reflects a broader concern that investor enthusiasm has decoupled from fundamental economic value. He said that the risk of a crash increases as prices deviate further from historical norms [4].
“"This is the most expensive market in American history."”
Grantham's assessment highlights a growing tension between the productivity promises of artificial intelligence and the actual financial valuations of the companies delivering them. If the market undergoes the 70% correction he predicts, it would suggest that AI was a speculative driver rather than a fundamental shift in economic value, potentially triggering a broader recession.
