Meredeth Whitney Investor's Call

I've really gotten to like Meredeth Whitney lately. Probably because she is right most of the time. Here is her latest:

From July 2007 to date, over $5 trillion worth of securities have been downgraded, but our concern here is that the pace of downgrades has only accelerated through 2008," the Oppenheimer analyst wrote in a research note dated January 6.

It seems as though the banks may be holding off on lending because they are concerned about the rate of right downs on existing debt. Which explains a lot and makes a lot more sense than other ideas that I have heard that the credit freeze is due to fearful non-bank actors who are wary of any risk at the moment and constitute the majority of US lending through the bond markets. If banks are suffering write downs on their debt, than those same private equity and sovereign wealth funds HAVE TO be dealing with the same (or greater) order of losses.