Meredith Whitney Speaks Out On Political Gridlock, The Crisis In New Jersey, And The Never-Ending Mortgage Crisis

meredith whitney

Meredith Whitney on CNBC is talking about her big issue, state governments, again.

The states where she’s warning of huge trouble:

  • New Jersey — the nominal numbers aren’t so huge, but relative to GDP its enormous.
  • California — part of its huge problem is that the political system is so screwed up, the government can’t easily make changes.
  • Illinois and Georgia also in a lot of trouble.

As for the level at DC: “Gridlock can put our economy in a very bad state.”

As for mortgages, she thinks the putback/misrepresentation issue could still be very bad.

On QE2: There’s so much market expectation for this, there’s no way it can deliver. It’s complicated and dangerous.

This year there will be another leg down in housing, which is a reason banks shouldn’t be too aggressive about hiking dividends.

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