The investment manager GMO has published its 7-year asset class real return forecasts for 30th September 2014 and they sync very well with our current market views. Based on current stock market valuations, GMO is forecasting negative real returns each year for the next 7 years for US equities of between -1.5% (US large cap stocks) and -4.1% (US small cap stocks). Their expected real return forecast for European stocks is little better at +1.8%, while emerging market equities appears to be the only real bright spot with an expected annual real return of +3.7%.