Deadbeat States: Make No Mistake… Muni-Bond Defaults Are Headed Our Way

Let's make one thing perfectly clear: Wall Street analyst Meredith Whitney is not crying wolf. Whitney - who gained fame for correctly predicting the U.S. banking implosion that presaged a global credit crisis - is now warning us about defaults in the $2.9 trillion municipal bond market. Whitney is being savaged for this latest prognostication, mostly by institutional money managers who resent the way that she's roiled the traditionally sleepy "muni" market. That's as unfair as it is ugly . It's unfair, because she's correct: muni-bond defaults are headed our way. And it's ugly because the naysayers - vested Wall Street interests that are only trying to protect their playground - are obscuring the truth. And with this dissembling, the Whitney-bashers are keeping disadvantaged individual investors from understanding the disaster at hand, and are likely dissuading these bondholders from avoiding the locomotive that's steaming head-on at their portfolios. Make no mistake: The so-called " deadbeat states " problem is real, and muni-bond defaults are almost certainly unavoidable. For our take on the current muni-bond controversy, please read on...