Wall Street Breakfast: Must-Know News [View article]
Whitney warns on state budget crisis. Look for states to suffer a collapse similar to the banking industry implosion of 2008 as crippling deficits come back to haunt them, outspoken analyst Meredith Whitney said Tuesday (video). "The similarities between the states and the banks are extreme to the extent that states have been spending dramatically and are leveraged dramatically," she said. Whitney, famous for calling the financial sector crisis, warned banks aren't out of the woods yet, predicting a sharp drop in housing prices and shrinking trading revenues will decimate Q4 earnings. ______________________...
Rather than correct the structural issues of fiscal imbalances and insolvency, we will proceed in some fashion to "fix" the problem with additional liquidity in the form of new debt which will only "paper over" the underlying problem and kick the can down the road.
Along with reducing the power of unions, we need reductions in services, compensation and retirement benefits. Additionally, the private sector can reduce its footprint by outsourcing routine activities to the private sector who can perform them at a lower cost.
We must recognize we, at every level, are living beyond our means and must embrace difficult decisions and pain as part of the solution.
Wall Street Breakfast: Must-Know News [View article]
______________________...
Rather than correct the structural issues of fiscal imbalances and insolvency, we will proceed in some fashion to "fix" the problem with additional liquidity in the form of new debt which will only "paper over" the underlying problem and kick the can down the road.
Along with reducing the power of unions, we need reductions in services, compensation and retirement benefits. Additionally, the private sector can reduce its footprint by outsourcing routine activities to the private sector who can perform them at a lower cost.
We must recognize we, at every level, are living beyond our means and must embrace difficult decisions and pain as part of the solution.