JKirk

Rating Agencies Target Guarantors to Deflect Subprime Blame

Really, what ABK/MBI suffer from is that they don't control their business model. It relies on a AAA rating from the rating agencies and they didn't have a contractual goal post for maintaining that rating. They thought they just had to have reserves that fulfilled the Moodys/S&P models, but have found out those models... however long they've been in effect previously, can be changed 3 times in a six-month period due to fear. I don't know if ABK/MBI will remain going concerns, but in run-off they seem to be worth multiples of their current stock price... and there are of course lots of talented/experienced people there available to start new financial guarantor companies.

The Great Monoline Debate Goes to Washington

A well written and logical argument regarding the monolines. There have been few, far-between on SA. I have heldd the opinion that the claim-paying resources are adequate, but am still fearful that Ackman et al can attack the MBIA/ABK structure, that is kill the holding companies via regulators or agency actions. While the policyholders remain safe, the debt and equity holders are left with nothing.