GMO’s Jeremy Grantham recently sat down for a lengthy interview with Charlie Rose, and offered a number of interesting takes on the economy and stock market.

Grantham says that the great U.S. franchise company stocks are a bit expensive, but that the balance of the U.S. market is very expensive. Overseas in emerging markets, the picture is better, he says. He’s currently slightly underweight global equities, and heavily underweight U.S. equities outside of those great franchise companies. Still, he says we’re not in a terrible outlier situation for the market — he just thinks investors should be careful when buying regular U.S. stocks.

More generally, Grantham also said that, despite what efficient market theorists say, markets can be “crazily inefficient” at times, and that “economic theory doesn’t work with human beings”, who he says are far too “messy”.

Grantham reiterated his belief that the global economy is in a long-term slowdown that is being unappreciated by most economists, who aren’t interested in the long-term. He says that gross domestic product growth is a function of population growth and productivity growth. In the U.S., growth of the workforce has slowed significantly, in part because the addition of women into the workforce over the second half of last century has peaked. He thus does not think the U.S. will return to its former levels of 2.5% or 3% GDP growth per year.

Grantham also reiterates his concern about resource use. He says that we can switch pretty seamlessly to alternative energy sources, but he doubts political leaders’ willingness to do so. If we keep going in the path were going, however, he sees terrible consequences.

Despite his bearish economic views, Grantham says there is no reason to think good companies won’t be profitable. “What it’s about is value,” he says. He also says that the U.S. would be better off using direct government spending to stimulate the economy rather than creating an ultra-low interest rate environment, and he says the hyperfocus on the U.S. debt problems is distracting from real-world problems. What really matters is the quantity and quality of the people in economy, meaning things like job training and education need to be improved in America, he says.