Notable analyst Meredith Whitney created a lot of buzz defending her prediction that the $3 trillion municipal bond market faces the immediate threat of hundreds of billions of dollars in default.
But not everyone agrees with Whitney's grim outlook.
"The hundreds of billions of dollars is really the issue," Ben Thompson, a portfolio manager who oversees about $7 billion in tax exempt bonds for Samson Capital, told CNBC's "The Strategy Session" on Wednesday.
"I can't say nothing's impossible, but the reality is you need major urban areas to collapse in the next twelve months for this to be true," Thompson said.
"Interestingly, over the summer the volatility was related to credit. The volatility of the last six weeks is really related to Build America Bonds, heavy supply, mutual funds outflow," he said.
Thompson pointed out that in order to understand the muni market, you have to separate the rated versus the unrated debt.
"When you have the unrated sector, which is things like nursing homes and housing projects and speculative development, you are going to see an increasing default rate, and you have," he said.
Also, comparing sovereign debt to muni debt, Greece is 130 percent of GDP in debt, going to 150 percent. Even the U.S. government is over 50 percent, he said.
"When you look at the states as a percentage of growth, state products, they're basically 7 percent," he said, adding, "Illinois is fully loaded obligations, debt and pensions, 16 percent of the growth state product.
Watch CNBC's "The Strategy Session" weekdays at Noon ET.