Meredith Whitney is Here to Help

by StockJockey

Sunday, November 30, 2008 - 9:29 pm

It has been a little over a year now since Meredith Whitney burst on to the scene. Sure, old timers have seen her name in print for roughly ten years now, going back the the merger and integration of Wheat First/First Union/Wachovia etc.

But she has accumulated valuable intellectual and/or political capital in the past 12 months, and is now spending it wisely, unlike most Americans. Her OpEd today in the Financial Times makes it clear, she feels your pain, America:

As an analyst, it is my job to do fundamental research and call it as I see it, and my bailiwick is financials. My outlook has been negative for over a year and, technically, I have been “right” on my calls. Seeing massive capital destruction has brought me no pleasure, but unfortunately I see little on the horizon that would change my outlook. In fact, after observing the US economy so derailed, I feel that I must act as a citizen of this great country to attempt to offer solutions to this economic train wreck we are all involved in.

First, I am more bearish today than I have been in the past 18 months. FT

Change your diapers and keep reading, if you are man enough.

Whats in her wallet?

That would be like asking her age. But Meredith is worried that banks will ratchet back credit too far, further choking off the economy, and has a few suggestions for regulators and bankers who will probably overshoot, and exacerbate the great consumer credit crunch of 2009.

While we are at it, props to her. She warmed up to Citigroup last week, bestowing it with an “appropriate for risk tolerant investors” endorsement when it traded under $5, after reminding investors it was highly speculative. So far, so good given where it closed the holiday shortened week.

Of course this idea, which you can read about at the FT, might not get the traction she is accustomed. But at least hear her out.

She has earned it.

______________________________________________________

America must keep consumer liquidity flowing
Financial Times
-----------------------------------------------------------------------------------------------------------------------
The content contained represent the opinions of 1440 Wall Street. This commentary in no way constitutes a solicitation of business or investment advice. It is intended solely for the entertainment of the reader, and the author. No Position

Comments:

@Stockjockey- Pres Elect says Main Street is 1st before Wall Street, while we know most major banks are in fact insolvent(not his fault),is a write off /cxl of the CDO’s insurance contracts due upon us? or at least at this stage, a set price on the dollar? Just Asking...?

Posted by on 12/01/2008 at 12:29 AM

BTB,

I am sure there is much wrangling behind the scenes coming into year end.

The auditors need to stand their ground, but we are months from any sort of resolution I think, wait for year end numbers and see what kind of treatment was applied.

check this out

http://tinyurl.com/67t3ga

and accounting onion

http://tinyurl.com/5jhvgf

I had dinner with the ex CFO of MS and JPM this weekend, he is also advisor to IASB, but he did not want to talk shop. However, If you need a suggestion on how to construct a deer fence in the Hamptons, he is your man.

Zoning prohibits high fences, 3 rows of four foot fence will do the job, interspersed with 500k worth of landscaping.

Battling deer is more fun than getting caught between Purcell and John Mack.

And looking back, Purcell’s cautious stance and limited risk taking maybe was not so bad after all. Much of the damage to MS was done after John came back and turned the bankers loose.

Posted by on 12/01/2008 at 01:30 PM