How the power players do it - by Fortune senior editor at large Patricia Sellers

Meredith Whitney on her 60 Minute warnings

December 21, 2010: 11:45 AM ET

by Patricia Sellers

Meredith WhitneyMeredith Whitney dropped a big lump of coal on municipal bond investors' holiday.

Sunday night, on 60 Minutes, the Wall Street analyst -- who warned early and famously in October 2007 that bank stocks would collapse, and soon they did -- blared her warning about the dire financial conditions of the U.S. states. Since her TV turn, Whitney told me this morning, she's been fielding lots of emails and calls, some congratulatory and others charging that she's overly worried and alarmist.

"I didn't put on that debt!" says Whitney, standing her ground that the 15 largest states, including California and New Jersey and Illinois, are wildly over-leveraged -- like the big banks were three years ago. This time, Whitney sees a similar level of investor complacency -- and another dreadful outcome. There may well be more than 100 municipal-bond defaults and restructurings in the next 12 months, she predicts. That, she adds, would cascade into hundreds of billions of dollars in investor losses.

Whitney's 600-page report on the state of the states is available only to clients of Meredith Whitney Advisory Group. But if you care to see the market-moving analyst, who is No. 38 on Fortune's Most Powerful Women list, on 60 Minutes, here's the segment, "State Budgets: Day of Reckoning" that is sure to add a tad more stress to your holiday season.

Join the Conversation
Fortune's Most Powerful Women
Fortune's Most Powerful Women For the latest on the most influential women in business, philanthropy, government, and the arts, like us on Facebook.
Guest Posts
Fortune Most Powerful Women Fortune Most Powerful Women The rolodex that redefined power
Profile in The Washington Post
Sheryl Sandberg: Sheryl Sandberg: Don't leave before you leave
COO of Facebook
Wendy Clark Wendy Clark Exec learns firsthand how the homeless live
SVP of the Global Sparkling Brand Center at Coca-Cola
Marissa Mayer's 3 biggest decisions as Yahoo CEO With company stock up over 100% since she began running the company 16 months ago, Mayer reflects on her choices to date. Watch
Chelsea Clinton on running for office: 'I don't know' The vice chairman of the Clinton Foundation talks about her diverse career path and growing up in the spotlight. Watch
About This Author
Pattie Sellers
Pattie Sellers
Senior Editor at Large, Fortune
Executive Director of MPW/Live Content, Time Inc.

Pattie Sellers has written more than 20 Fortune cover stories including "Marissa Mayer: Ready to Rumble at Yahoo," "Muhtar Kent's New Coke," "Oprah's Next Act", "The $100 Billion Woman" (Melinda Gates), and "Gone with the Wind" (Ted Turner). She co-founded Fortune Most Powerful Women and oversees the Fortune MPW Summit, the preeminent gathering of women leaders in business and beyond—and programs such as Fortune MPW Entrepreneurs and the Fortune-U.S. State Department Global Women Leaders Mentoring Partnership. Pattie also develops Live Content across Time Inc. Her blog, Postcards, is about how power players lead and navigate their careers. Pattie won Time Inc.'s prestigious MVP award for her performance in 2012.

Email Pattie Sellers | Welcome to Postcards.
Follow Pattie | email newsletter
MPWomen go Global

The Fortune/U.S. State Department Global Women Leaders Mentoring Partnership brings rising-star women from countries around the world to the U.S. for three-week mentorships with participants of the annual Fortune Most Powerful Women Summit - among them Ursula Burns of Xerox, Laura Lang of Time Inc., Marissa Mayer of Yahoo, and Tory Burch.

Read more

Current Issue
  • Give the gift of Fortune
  • Get the Fortune app
  • Subscribe
Powered by VIP.