The Business On... Meredith Whitney, Founder, Meredith Whitney Advisory Group

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The Independent Online

I'm scared

The mention of her name does that. She is the most famous bear on Wall Street. Whatever you think is the scariest prediction on the solvency of the banks/the collapse of US house prices/job prospects in the finance industry, Ms Whitney will tell you it is going to be worse.

Not one of life's optimists, then?

It's not pathological. She just does a lot of research. People have been taking notice ever since October 2007, when she predicted Citigroup, the most significant bank in the US, would run out of money to pay its dividend.

Well she was right about that – and then some.

Indeed, and the plain-speaking manner of her delivery marks her out in an industry of wafflers. She's been nicknamed the Dollar Dominatrix for her stridency. She is married to a former professional wrestler, so go analyse.

Where does she come from?

When she made the Citigroup prediction, she was banking sector analyst at Oppenheimer & Co, a middling investment bank. She learnt her craft there at the knee of Steve Eisman. He wasn't famous before the crisis, either, but he is one of the heroes of the Michael Lewis book The Big Short, about the Wall Street misfits who saw the credit crisis coming and made a fortune betting against the banks.

With the economy recovering, presumably she is less bearish?

Ha ha. Absolutely not. In fact she is predicting the next financial crisis, the next $1 trillion government bailout, and a new era of economic misery.

Told you I was scared

She says local government finances in the US remind her of the banks before the crisis. She predicts a wave of bond defaults by cities that will ripple through the banking industry, while the mightiest state economies from California down will be crippled by a budget crisis.

Yikes. What can we do?

Hope she's wrong. For the first time.