Grantham's Perpetual Bear Fund: OpenAI and SpaceX IPOs threaten to crash US stock market

Investment company GMO (Grantham, Mayo, van Otterloo & Co.) Jeremy Grantham, who predicted the collapse of the dot-com bubble and the global financial crisis, has warned of an unobvious risk that carries the planned 2026 IPO of several companies worth hundreds of billions of dollars each. The almost simultaneous entry of such giants as SpaceX and OpenAI into the stock market could trigger its fall, GMO said.

"My prediction is that in 2026 we will see a level of excitement around IPOs that we haven't seen in a long time. I anticipate that at least two non-public giants [of the trio] OpenAI, Anthropic and SpaceX will go public, and that will likely put pressure on the U.S. market later this year," GMO's co-head of asset allocation Ben Inker said during an investment firm webinar in early January, a point highlighted by MarketWatch on Feb. 17.

According to Inker's calculations, historically, every 1% increase in stock market capitalization due to an IPO subsequently causes stock prices to decline by about 7.5% over the next 12 months. "After an IPO, the market will probably rise initially, but in the long run - as more shareholders get the opportunity to monetize their investments - it will create problems for the U.S. [stock] market," the financier argues.

The capitalization of the U.S. stock market is now about $50 trillion. Thus, to increase it by 1% would require the listing of companies with a total value of $500 billion, states MarketWatch. According to Forge Global, Elon Musk's SpaceX alone is now valued at $1.4 trillion. AI startups OpenAI and Anthropic, which are also preparing to go public this year, have reached valuations of $500 billion and $380 billion, respectively.

Jeremy Grantham, one of the most respected veteran investors on Wall Street, has taken a cautious view of the U.S. stock market for more than a decade running. In his memoir Becoming a Perpetual Bear: The Perils of Long-Term Investing in a World of Short-Termism, published in early 2026, Grantham wrote that the hype surrounding ChatGPT created a "bubble within a bubble," only temporarily keeping the stock market from falling.

According to the investment guru, as soon as this particular AI bubble deflates, the main bubble in the market will also collapse. Grantham gives a gloomy forecast: the rally of the past years has actually "eaten up" future profits, so the long-term prospects of the market look one of the worst in history, the investor believes. Now market participants face either perpetually low returns or a hard "bear" trend with a subsequent return to normal, Business Insider quoted his memoir on February 14.

This article was AI-translated and verified by a human editor