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Meredith Whitney Was Flat-Out Wrong About Municipal Bonds

TedTed
in Fund Discussions
FYI: Being too far ahead of your time is indistinguishable from being wrong.”

That’s what Howard Marks, chairman and co-founder of Oaktree Capital Group LLC, wrote in a memo to clients about 11 years ago. Around that same time in late 2007, banking analyst Meredith Whitney made a prescient negative call on Citigroup Inc. that exacerbated a market sell-off and, she said, prompted death threats. Perhaps emboldened by that experience, she made another headline-grabbing prediction in a December 2010 broadcast of CBS Corp.’s “60 Minutes” program: There would be “50 to 100 sizable defaults” in the U.S. municipal market in the coming year, totaling “hundreds of billions of dollars.”
Regards,
Ted
https://www.fa-mag.com/news/meredith-whitney-was-flat-out-wrong-about-municipal-bonds-41662.html?print

Meredith Whitney 60 Minutes Interview 12/19/2010:

Comments

  • jerry
    Not completely clear WHY she got it wrong particularly since the following year(2011) was not a good one for the stock market (though the bond market did ok) Anyone have thoughts or an article on the subject?
  • JoeD
    edited October 2018
    But she looked so nice in her white pearl necklace! You just really WANTED to believe her. She spooked the muni market at the time. That much she accomplished.
  • AndyJ
    Muni bond investors of the strategic kind still fondly recall the Whitney Bottom (no, not that one) as the best buying opportunity of the last decade.
  • VintageFreakVintageFreak
    Keep making calls, get one right, money pours in, next call does not work out. But wait...just focus in the middle...money pours in. Classic.

    This is a business where you have to be right only ONCE in your life and it will set you up for good.
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