Meredith Whitney says Texas matters most because much of AI depends on who becomes governor.
Whitney says Republicans are out of touch on affordability, one in four SNAP recipients has lost benefits, and she expects a big upset.
Whitney cites pawn loans up over 30% and wage-access growth at Dave, Chime and Block as overlooked consumer stress.
Whitney Sees Midterm Upset as Affordability Anger Builds
Meredith Whitney expects a big midterm upset because affordability has made the electorate angry. She argues the real evidence sits outside bank lending data, in the private products that serve households banks do not reach. She is watching Texas because AI policy depends on its next governor, and she sees a centrist trend that could carry James Talarico to a win there.
Takeaways
Affordability is the election's top issue. Paul Sweeney calls affordability arguably the number one issue in this election cycle. Whitney says Republicans have been out of touch on affordability and know they are at serious risk, and she expects the electorate's anger to produce a big upset.
Bank data misses half of US households. Banks lend only to prime and super-prime borrowers, Whitney says, so anyone wanting to see what is happening to the 50 percent of households outside that group must look at other data. That data sits largely with private companies.
Pawn loans and wage access show stress. Pawn loans have grown more than 30 percent over the last few years, Whitney says. Daily wage access loans have grown rapidly among people who cannot make it from paycheck to paycheck and have to go from payday to payday.
Private fintechs hold granular consumer data. Companies such as Dave and Chime offer cash-advance and wage-access products, and Block is another example. These are the fastest-growing products within those companies, Whitney says, and many economists are not paying close attention.
One in four SNAP recipients lost access. Whitney says one in four food stamp recipients has lost the ability to access benefits. She calls the Republican talking point that all income levels grew in the most recent Bureau of Labor Statistics data stale.
A centrist trend is growing in the country. Whitney says more and more people are centrist even though extremes dominate the parties and most people do not relate to either party. She cites Texas as an example of that growing centrist trend.
Whitney's midterm calls
Texas is the race to watch because much of AI depends on who becomes the next governor.
Polls and prediction markets have performed badly in recent elections, including Brazil and Israel.
She expects a big upset because the electorate is really angry.
She expects centrist James Talarico to win Texas, which would say a lot about the country.
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