oldlures1

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    • Sun Jun 22nd 13:21 PM | Rating: 0 0
      Commented on:
      On the Monolines: Brown vs. Tilson, Round 2
      Sadly thought, it also reminds me of my suspicion that MBI and ABK (and possibly FSA next?) are casualties of a well-orchestrated, collaberative effort by parties (such as the hedgies, Buffett and the rating agencies) to destroy the companies and create opportunities for profit in the process. Admittedly, I believe this has been a commonly employed tact for decades. However, it one thing to impact a company, its quite another when those actions impact $1 trillion in debt and the entire financial system! I've got to believe that much of the current turmoil will dissipate once the election is over.

      Good grief, what have I become?! I've never EVER been conspiracy-minded, but when left with no reasonable (factual) substantive evidence for events, I guess I have search for explanations elsewhere.
      View article »
    • Sun Jun 22nd 12:49 PM | Rating: 0 0
      Commented on:
      On the Monolines: Brown vs. Tilson, Round 2
      Excellent job, Mr. Brown! Well-articulated and, dare I say, ironclad! <grin>
      View article »
    • Sun Jun 22nd 12:37 PM | Rating: 0 0
      Commented on:
      MBIA: The View from New York State
      Good column, Mr. Salmon - good points, and lots of info worth cogitating on. Thnx.
      View article »
    • Sun Jun 22nd 12:32 PM | Rating: 0 0
      Commented on:
      MBIA: Moody's Twists the Knife
      User148443 - I wish I could say definitely, but I just don't know. Admittedly, I was more confident months ago, but the unpredictable (if not irresponsible!) actions of the ratings agencies have shaken my otherwise fundamental approach to investing. I don't think MBI or ABK will be insolvent, which is what most adverse opinions insinuate, but how they go-forward is the question. Will it be in run-off, or will they continue under a different name (via resurrecting the biz in one of their subsidiaries, or after being acquired).

      mythoughts - yes, I collect antique fishing tackle. And I must admit, at this juncture, it has proven to be a better investment than my various holdings in the financial sector.
      View article »
    • Fri Jun 20th 17:30 PM | Rating: 0 0
      Commented on:
      MBIA: Moody's Twists the Knife
      phantom - I'll offer that Ackman has not been "right" with regard to the monolines specifically, but rather he's only been "right" in predicting the effectiveness of his propaganda and it's ability to manipulate the market. His propaganda has created an environment (and perception) adverse to the monolines, leading them to where they are today -- not on fundamentals, but perception. In fact, I'll offer that none of his predictions with specific regard to performance of their respective portfolios has materialized. But that irrelevant, as he has still managed to gain from the companies' distress. Yes, I'll concede, his "predictions"... are becoming "reality", but it little to do with the monolines and almost everything to do with creating false perception and lack of confidence in the market. Marty Whitman called Ackman a "slick salesman", and "slick" he is! I prefer to compare him to the Pied Piper; he plays his magical flute for the masses and they follow his lead - i.e. whatever he says, it must be right! And unfortunately, that is exactly how this has played out. The mkt has yet to wake from its trance to realize how sinister a customer he is! He's a reckless, self-centered, dare I say dangerous, individual.
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    • Fri Jun 20th 15:53 PM | Rating: 0 0
      Commented on:
      MBIA vs. Smith and Jones
      Mbuna - it boils down to a matter of interpretation and definition. Your's just happen to be different, that's all. Personally, I share the perspective of Mr. Salmon.

      PSFS - this isn't a journalist medium, it's a blog, full of opinions. If you want journalism, I'd love to be able to point you to today's media, which is where it should be...but sadly you won't find it there either, at least not containing accuracy or integrity.
      View article »
    • Fri Jun 20th 14:57 PM | Rating: 0 0
      Commented on:
      MBIA: Rosner's Take
      That's a fair position to take on the matter. However, I'm not as deeply convinced of the accuracy of Rosner's position overall. He does give good food-for-thought though.
      View article »
    • Fri Jun 20th 14:49 PM | Rating: 0 0
      Commented on:
      MBIA: Moody's Twists the Knife
      User148443 - welcome to the party! You're coming into this game at an interesting juncture. Personally, I'm heavily vested in MBI, so I'm going to ride this pony 'til it bucks me off. That said, I'd be remiss if I didn't advise you to wait on the sidelines. My confidence is getting rattled these days, not because I doubt the companies' numbers, but because there are forces at work here that are less obvious and very unpredictable. The companies' financial fundamentals are sound; they exceed the rating agencies capital requirements and can pay policyholders under worst-case scenarios. So why are they being downgraded, you ask? Good question. Frankly, they shouldn't be. But this all has evolved into a classic example of (false) perception becoming reality.

      It all began when activist hedge fund managers, like Ackman, shorted the monolines. They then intentionally launched highly visible, well-executed propaganda campaigns to trash the companies. Like the rats led by the Pied Piper of Hamlin, the market soon began to buy into the propoganda. Ackman and other were successful in creating a "perception" (albeit a false one) that began to manifest itself into a "reality". The stock price dropped, and Ackman (and fellow manipulators) made a bundle on their short positions. As expected, the companies' reputations fell under fire, and they soon found it hard (although not impossible) to write new business. Yes, they were still writing business, but much less than before. The rating agencies, which had maintained the companies' AAA-ratings, soon fell under scrutiny from the market place. The mkt couldn't understand why its "reality" wasn't that of the rating agencies, as such it deduced the rating agencies were inept. Feeling the pressure, the rating agencies downgraded the monolines, but lacked substantive supporting evidence, so they quoted such things as "financial flexibility" and "franchise value" as reasons for their actions. In other words, they questioned the monolines ability to write new biz. But remember, they were, in fact, still writing business...albeit much less. Given enough time, the Pied Piper-induced "reality" would have, in time, dissipated like an oceanic fog on a sunny day, and the monolines could have henceforth resumed business-as-usual. However, by downgrading the monolines, the rating agencies effectively shut the monolines' doors; they can't write biz without the "AAA". Ironic, isn't it? And so now you find MBI and ABK trying to open new entities via pre-existing subsidiaries. The subsidiaries can be rated "AAA"; they don't need the holding co's rating.

      Sure, you'll hear a lot of rhetoric about how monolines are toast. But ask yourself this, if that were the case; if the whole industry was doomed, why did Buffett just enter the market via his newly created monoline, Berkshire Hathaway Assurance (who, by the way, owns 20% of Moodys rating service -- interesting huh?).

      Meanwhile, Ackman and is others activist hedgies keep blowing away on their magical flutes, and the market rats follow mindlessly. Ackman is now "out" of his positions on MBI and ABK, so he's trained his sight on FSA, a AAA-rated (for now!) monoline.

      I truly hope MBI and ABK survive this. Sure, they made mistakes, and should take their blows accordingly. But their mistakes are not (and should not be) dibilitating. They're good companies, with sound fundamentals and strong leadership, that should be allowed to survive on their own merits and not be destroyed by the selfless, self-centered antics of activist hedge funds.
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    • Fri Jun 20th 13:58 PM | Rating: 0 0
      Commented on:
      More Alarmism Over MBIA
      fxtrader - I agree; you're right on.

      User - Ackman himself said he was effectively "out" of his positions on both MBI and ABK. And now, having made his money on those two, he'll ride the wave of panic and hysteria that he's created and focus his sight on FSA. Their value is still very lofty. So, what does he do? He has now announced a short position in FSA, and you can expect a deftly executed propoganda camgaign against them in an attempt to drive down their stock price. And sadly, I worry, the market, like a bunch of rats, will followed the Pied Piper's magical flute over the cliff of panic and hysteria.
      View article »
    • Fri Jun 20th 10:29 AM | Rating: 0 0
      Commented on:
      Fund Manager Ackman Shorting Financial Security Assurance
      vittell's right - Ackman is an activist hedge fund manager with a "loud mouth" and an agenda. To his credit, he's an extremely effective propogandist, and will use that tool to his financial benefit...and no one elses, I asure you.

      But this time, I think he's bitten off more than he can chew, and is showing his true colors.
      View article »
    • Wed Jun 18th 17:03 PM | Rating: 0 0
      Commented on:
      Bond Insurer Buying: Time to Dabble Soon?
      Ishortyou - the more this rocks on, the more I'm convinced that your prediction will prove out.
      As Schweister said, the game is changing.
      And as these guys take a ableit forced hiatus, they're getting stronger.
      View article »
    • Wed Jun 18th 16:58 PM | Rating: 0 0
      Commented on:
      Bond Insurer Buying: Time to Dabble Soon?
      Berkshire's originations to date have been mostly reinsurance of existing business, not new originations. Also, I think it would be in Berk's best interest to tred lightly in this area. After all, as a 20% owner in Moody's, the obvious conflict-of-interest would be hard to hide should they start growing their business in the absence of those pesky competitors ABK and MBI.
      View article »
    • Wed Jun 18th 16:38 PM | Rating: 0 0
      Commented on:
      Whitney Tilson’s Response on the Monolines
      Like Ackman, you are intelligent, articulate and make a convincing argument. And to that extent, your (and Ackman's) agenda-driven propoganda has obviously proven convincing to many - the stock price of both companies has been pummelled! Kudos - you accomplished your goal, and stand to gain monetarily. At this point, Ackman no longer holds positions in either; he's made his money, he's out, so where is your target level? It can't be far.

      Suffice to say, I'm in Mr. Brown's camp on this issue. It has been a (financially) painful ride, but I'm staying on board - I'm in it for the long haul...."long&quo... being the key word. I believe in the financial fundamentals and the leadership; the latter of which I've been very impressed with! It's disappointing, from my admittedly biased perch, that the market can be so easily lead by (albeit very adept) propogandists.

      Lastly, you imply that Mr. Brown is "simply incorrect". You're entitled to your opinion, after all this is a blog. But since we're opining, I believe your interpretation of the facts is "incorrect" and, not surprisingly, skewed to support your short position.
      View article »
    • Tue Jun 17th 17:24 PM | Rating: 0 0
      Commented on:
      Disagreeing With Tilson on the Monoline Insurers
      fx - we share the same suspicion.
      And would me interested to hear from the SA editors as well.
      View article »
    • Mon Jun 16th 16:18 PM | Rating: 0 0
      Commented on:
      Disagreeing With Tilson on the Monoline Insurers
      I noticed the article has been "temporarily removed from publication". Interesting.
      Nevertheless, I googled the article and hit "cached" and pulled it up (and saved it!).
      It's refreshing to see the otherside side; a perspective contrary to all the one-sided garbage painting the headlines (and apparently the pages of Seeking Alpha) these days.
      Thank you, Mr. Brown, sincerely! I hope your opposing view didn't result in a backlash from Tilson's camp, or worse yet a retraction of the invitation to speak at his conference.
      View article »
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