June 8, 2011 by USA Post
Meredith Whitney, Wall Street bankinganlyst Meredith Whitney told CNBC on Wednesday he stands by her call last year that hundreds of billions of dollars in U.S. bonds municipal default. “Unfortunately, that is the size you will be watching,” Whitney told CNBC’s Squawk Box. He added, however, that the search for a strict timetable “misses the point” and that the failures are only part of a broader question about state and local finances. Last year, Whitney unnerved investors in the market and 2.9 trillion municipal bond when he said on CBS television’s 60 Minutes that the market could see from 50 to 100 by default local governments worth hundreds of billions of dollars.
Whitney made her reputation in 2007 correctly predicted that Citigroup would need a massive infusion of capital. On CNBC, said the poor state of government budgets. She said that the unfunded liabilities threaten their finances with the result that many states may have to sell or privatize the assets to raise cash. Whitney said off-balance sheet debt expenses sheet and pension unfunded liabilities are problems to be addressed by the states.
“State governors agree with me,” he told CNBC. “It’s the muni bond market is not.”
He added that recent research done by her firm, Meredith Whitney Advisory Group, is the validation of their claims, even though municipal bond research is like jumping into a “pool” with “terrible” disclosure.
Whitney was released a report this week that paints a bleak picture of municipal finances, according to Fortune magazine.
In May, Whitney wrote in an opinion column in The Wall Street Journal that the state and local government finances threaten the U.S. economic recovery and should be treated.
In an interview on Bloomberg radio in May, also trapped by her prediction of default, but added a title. “I never gave accurate estimates or a specific period of time”
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