(Bloomberg Opinion) -- It was perhaps only natural that Christopher Whalen, this week's guest on Masters in Business, did a stint as a researcher at the Federal Reserve before departing for a job on Wall Street.
Whalen grew up in Washington: his father was a speechwriter for Richard Nixon and an adviser to Ronald Reagan. Both parents were politically active in the Republican Party at a time when the capital was dominated by Democrats. He met and spent time with several Fed leaders, including Arthur Burns, Paul Volcker and Alan Greenspan.
Early in his career, he worked at the Fed, at one point supervising Citigroup's international credit operations. He joined Bear Stearns in the mid-1980s in its investment banking and fixed-income divisions.
Whalen explains the mechanics of how the Fed provides both credit and liquidity to both the bank and fixed-income markets. His concern is that a third or more of people who have requested forbearance on their mortgages in the pandemic eventually will default. The consequences won't be pretty.
He is the founder and president of Whalen Global Advisors, and is the author most recently of, "Ford Men: From Inspiration to Enterprise."
His favorite books are here; a transcript of our conversation is here.
You can stream and download our full conversation, including the podcast extras, on Apple iTunes, Spotify, Overcast, Google, Bloomberg and Stitcher. All of our earlier podcasts on your favorite pod hosts can be found here.
Next week, we speak with Jim Chanos, famed short seller and founder of Kynikos Associates. Chanos helped to expose a number of financial frauds, most famously Enron, Baldwin-United and Drexel Burnham.
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
Barry Ritholtz is a Bloomberg Opinion columnist. He is chairman and chief investment officer of Ritholtz Wealth Management, and was previously chief market strategist at Maxim Group. He is the author of “Bailout Nation.”
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