Meredith Whitney blames '60 Minutes' for her muni 'call,' then doubles down on the 'hell' coming for muni bonds
In places like Stockton, Calif., bondholders are being paid, but cuts to public pensions, rising crime and slow emergency responses, cuts to sports, arts programs in the schools are the price
Investment & Wealth Institute
Top Executive: Sean Walters
The emperor had no clothes. Her prediction was dead wrong. She knows a lot about banks, hats off for that, and virtually nothing about the municipal bond market. I saw some of the group’s analysis- it was sophomoric at best. If I recall, they acted like saying Illinois was a weak credit was some kind of revelation. Market participants have known that for a minimum of 25 years.
Not defending Whitney but 60 Minutes has sliced and diced video in the past to embellish their stories, completely distorting what the interviewee intended.
Meredith reiterated her comments after, she and her group published a paper on the subject. She was crystal clear in her prediction. This had nothing to do whatever with 60 minutes. What she really did was scare mom and pop to sell their municipal bonds at fire sale prices and helped fuel a liquidity problem for states and localities. All to give herself more publicity. Her predictions had no real basis which is why they proved to be so off the mark.
Richard is 100% correct, no distortion at all of her prediction. She was a one hit wonder, primarily from work done by her mentor Steve Eisman, a former Oppenheimer Analyst, on the banking industry. The muni prediction was her her own, bold to grab headlines and completely incorrect. Only idiots would pay $100,000 to get her research and shockingly several did!