The outspoken municipal bond bear follows up with more evidence that the fiscal troubles in many states are far greater than we’ve been told.
FORTUNE — Meredith Whitney is issuing a fresh warning to mutual funds, banks, and politicians: The state of state finances is far worse than what you think, or at least than what you’ve been willing to tell the investors and taxpayers who will eventually carry the burden. In a new report released today to her clients, Whitney summons what appears to be the most comprehensive set of data ever assembled on state budgets and debt.
Meredith Whitney, still focused on state finances.
Her conclusion is that the future deficits that need to be closed, either by new taxes or draconian cuts in social services, are far bigger than the official numbers show, and that debt levels, when all liabilities are counted, vastly exceed the official estimates.
Late last year on 60 Minutes, Whitney predicted hundreds of billions in defaults on municipal bonds in the next five years. That controversial call was widely condemned, especially on Wall Street, where the muni market is an enormous profit spinner.
Read more here: Meredith Whitney: State finances are worse than estimated – The Term Sheet: Fortune’s deals blog Term Sheet.
