Meredith Whitney, who a few years ago was the first to accuse the financial emperor of having no clothes, still maintains there’s going to be a double-dip price drop in housing, though she said it will probably be a “light” double dip.

She blames the shadow inventory of homes and a broken bank model for the continuing woes. According to Whitney, the broken bank model boils down to this: The banking system doesn’t know how to make large numbers of affordable mortgages available without securitization of mortgages — and the only institution now making large mortgage-securities purchases is the Fed, she says.

The Fed wants out of the mortgage-securities business, but it may have to backtrack on its stated policy, Whitney argues.

She makes some interesting arguments. What do you think?

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