Meredith Whitney was one of the first to call trouble at Citigroup in the early days of the 2008 financial crisis. She’s making another bold prediction in her new book, “Fate of the States: The New Geography of American Prosperity.”
As coastal states like California and Arizona slowly recover from the housing boom-and-bust, states in the middle of the country will be in a better position to capitalize on the economic recovery. Homeowners in states like Indiana didn’t have as much access to cheap credit a few years ago. Their cities and state governments didn’t build budgets on expectations the boom would continue. And now, they’re able to offer a host of incentives to prospective businesses as other states cut public services and school funding.
Now, says Whitney, you’re seeing “businesses relocate to the central corridor because of tax advantages, because of cheap energy, because of better ease of operations.” The central corridor includes states in the Midwest, states that were, until now, “flyover” states.
Whitney says “you look where opportunity is presenting itself." And that’s not California or New York she says. While economic recovery is coming to states once struggling, “the disparities in growth [between different states] are pretty dramatic.”
Whitney’s firm is located in Manhattan. She says she and her husband often debate moving to Texas.