beachtango

Why We're Still in the Early Innings of the Bursting of the Housing and Credit Bubbles - And Implications for MBIA and Ambac

Why can't you ever say anything positive about ABK or MBI? Why is everything you say so biased and transparently malicious? At the very least state both sides of argument...theirs and yours! Like the following article by the street.com..:

The embattled Armonk, N.Y.-based bond insurance outfit, which has raised some $2.6 billion in capital from private and public investors to appease Standard & Poor's and Moody's Investors Service, believes that it can snatch up new insurance and reinsurance policies from smaller firms that might be facing runoff -- a process in which they collect fees on policies they already insure, but pursue no new business -- or are otherwise hampered, CEO Jay Brown tells TheStreet.com.

"We have a clear opportunity. A number of companies look like they are going to go into runoff," Brown notes.

For his part, Brown has been scrambling since returning to MBIA as CEO last month to breathe new life into the world's largest bond insurance company. MBIA, the largest financial guarantor, and its next largest rival Ambac Financial(ABK - Cramer's Take - Stockpickr) have been swept up in perhaps the most harrowing financial turmoil the debt insurance sector has experienced in three decades. The guarantors have also been the target of short-selling hedge fund manager Bill Ackman, who has lobbed frequent verbal grenades at the companies through the press and his writings.

"Look at all the companies affected the most and you look at how much capacity the firms that have underwritten insurance. They don't have enough capacity," Brown says. Without being explicit, Brown said a number of the smaller guarantors may be susceptible to falling into runoff.

Still, restoring confidence among shareholders continues to be an uphill battle.

MBIA has so far underwritten "very little new business," according to a recent filing with the Securities and Exchange Commission. But Brown is optimistic that the pall surrounding the company will dissipate in the wake of S&P and Moody's affirming MBIA's pristine triple-A rating last month. The CEO also noted that MBIA wrapped up a public finance insurance deal for a $377 million toll road project. But the insurer will likely face further writedowns next quarter in areas tied to mortgage-tainted securities, including home equity mortgages that have dropped recently.

As a part of its restructuring efforts, MBIA announced late Thursday that it was cutting 48 positions, as it retools its structured finance insurance business. Brown's larger restructuring plan involves splitting up MBIA's more risky structured finance business from its safer, more conservative job of insuring debt for municipalities. The CEO has said the split may take up to five years to complete.

Some of the new staffers MBIA plans to hire in the near term will be part of a strategic financial group that will help the firm achieve its goal of underwriting conservative insurance policies. MBIA plans to steer clear of funky structured debt and staffers in its strategy group will help it figure out ways separate out its structured book of business.

Brown has said publicly that splitting up the structured book from the municipal business should help it secure future funding at attractive rates and help restore the guarantor's image to potential clients. At this point, MBIA is trading at a more than 80% discount to its share price a year ago.

MBIA has been adamant about its view that it has sufficient capital -- about $17 billion -- to pay claims should a deteriorating economy result in debt defaults.
NEW YORK, March 11 (Reuters) - U.S. bond insurers' losses are likely much lower than what the troubled firms have reported when marking their holdings to market prices, Moody's Investors Service said on Tuesday.

Shares of bond insurers like MBIA Inc (MBI.N: Quote, Profile, Research) and Ambac Financial Group (ABK.N: Quote, Profile, Research), which guarantee payments on roughly $2.4 trillion of debt securities, have fallen precipitously on worries about billions of dollars of claims on mortgage-related bonds they may have to pay out.

In the last six months, Ambac shares have fallen 79.4 percent and MBIA shares have slid 81 percent.

But Moody's approach to rating the guarantors involves trying to determine the "real economic loss" the firms will sustain, as opposed to mark-to-market losses, Moody's analyst Ted Collins said in response to a question on a conference call.

Such loss estimates are "lower than the mark to market that's being recorded," Collins said.

Accounting firms are putting increasing pressure on financial firms to mark their holdings to observable market prices. That has frustrated some firms, which argue that volatile short-term prices can exaggerate actual losses.

If the losses the bond insurers face turn out to be less than expected, that could provide some relief for investors.

Insurers like Ambac have had to write down the value of billions of dollars of credit derivatives, but these write-downs may not necessarily translate into actual losses.

As a result, some players are still confident the firms have enough capital and available funds to pay expected claims.

Tillson, Once again please try to write both sides of stories not just your own...make things interesting at least....

Ambac's Announcement is a Joke; Disagreeing with Whitman on Monolines

Tillson you're amazing...Get a clue, and do yourself a favor and cover your shorts...short interest is not what it was...Perhaps you need to review everything before you start posting. Please read on :


NEW YORK, March 11 (Reuters) - U.S. bond insurers' losses are likely much lower than what the troubled firms have reported when marking their holdings to market prices, Moody's Investors Service said on Tuesday.

Shares of bond insurers like MBIA Inc (MBI.N: Quote, Profile, Research) and Ambac Financial Group (ABK.N: Quote, Profile, Research), which guarantee payments on roughly $2.4 trillion of debt securities, have fallen precipitously on worries about billions of dollars of claims on mortgage-related bonds they may have to pay out.

In the last six months, Ambac shares have fallen 79.4 percent and MBIA shares have slid 81 percent.

But Moody's approach to rating the guarantors involves trying to determine the "real economic loss" the firms will sustain, as opposed to mark-to-market losses, Moody's analyst Ted Collins said in response to a question on a conference call.

Such loss estimates are "lower than the mark to market that's being recorded," Collins said.

Accounting firms are putting increasing pressure on financial firms to mark their holdings to observable market prices. That has frustrated some firms, which argue that volatile short-term prices can exaggerate actual losses.

If the losses the bond insurers face turn out to be less than expected, that could provide some relief for investors.

Insurers like Ambac have had to write down the value of billions of dollars of credit derivatives, but these write-downs may not necessarily translate into actual losses.

As a result, some players are still confident the firms have enough capital and available funds to pay expected claims.

once again shorts sellers , don't get caughts with your shorts down.. Satrt covering them while you can, and stop the cynicism.

Why We're Still in the Early Innings of the Bursting of the Housing and Credit Bubbles - And Implications for MBIA and Ambac

Why can't you ever say anything positive about ABK or MBI? Why is everything you say so biased and transparently malicious? At the very least state both sides of argument...theirs and yours! Like the following article by the street.com..:

The embattled Armonk, N.Y.-based bond insurance outfit, which has raised some $2.6 billion in capital from private and public investors to appease Standard & Poor's and Moody's Investors Service, believes that it can snatch up new insurance and reinsurance policies from smaller firms that might be facing runoff -- a process in which they collect fees on policies they already insure, but pursue no new business -- or are otherwise hampered, CEO Jay Brown tells TheStreet.com.

"We have a clear opportunity. A number of companies look like they are going to go into runoff," Brown notes.

For his part, Brown has been scrambling since returning to MBIA as CEO last month to breathe new life into the world's largest bond insurance company. MBIA, the largest financial guarantor, and its next largest rival Ambac Financial(ABK - Cramer's Take - Stockpickr) have been swept up in perhaps the most harrowing financial turmoil the debt insurance sector has experienced in three decades. The guarantors have also been the target of short-selling hedge fund manager Bill Ackman, who has lobbed frequent verbal grenades at the companies through the press and his writings.

"Look at all the companies affected the most and you look at how much capacity the firms that have underwritten insurance. They don't have enough capacity," Brown says. Without being explicit, Brown said a number of the smaller guarantors may be susceptible to falling into runoff.

Still, restoring confidence among shareholders continues to be an uphill battle.

MBIA has so far underwritten "very little new business," according to a recent filing with the Securities and Exchange Commission. But Brown is optimistic that the pall surrounding the company will dissipate in the wake of S&P and Moody's affirming MBIA's pristine triple-A rating last month. The CEO also noted that MBIA wrapped up a public finance insurance deal for a $377 million toll road project. But the insurer will likely face further writedowns next quarter in areas tied to mortgage-tainted securities, including home equity mortgages that have dropped recently.

As a part of its restructuring efforts, MBIA announced late Thursday that it was cutting 48 positions, as it retools its structured finance insurance business. Brown's larger restructuring plan involves splitting up MBIA's more risky structured finance business from its safer, more conservative job of insuring debt for municipalities. The CEO has said the split may take up to five years to complete.

Some of the new staffers MBIA plans to hire in the near term will be part of a strategic financial group that will help the firm achieve its goal of underwriting conservative insurance policies. MBIA plans to steer clear of funky structured debt and staffers in its strategy group will help it figure out ways separate out its structured book of business.

Brown has said publicly that splitting up the structured book from the municipal business should help it secure future funding at attractive rates and help restore the guarantor's image to potential clients. At this point, MBIA is trading at a more than 80% discount to its share price a year ago.

MBIA has been adamant about its view that it has sufficient capital -- about $17 billion -- to pay claims should a deteriorating economy result in debt defaults.

Tilson , I hope you're taking notes...

The Jury is Still Out on the Monolines

well if they're in a run off mode they will still be worth twice what they are worth now .....guaranteed!

What's Going on with Bond Insurers?

We live in a great country where one can publish unfounded information. Ct_programmer, I agree that it seems like a spreading disease how people have jumped on the , there's no need for bond insurers! For heavens sake, what is wrong with everyone, it's like they drank that Ackman punch!,...Warburg, Third Avenue, Davis select, and other investors not divulged have made millions of dollar investments "RECENTLY." I suppose they too like municipalities throw money away. I cannot wait to see these stocks double, and our economy to improve so that these negative, unhappy people have some more stupid things to say...,.

Third Avenue: Why MBIA Is a Good Buy

It is always refreshing to read about Mr. Whitmans perspective on undervalued value companies. His thoughts are expressed "without" sarcasm and rhetoric, and contain sound, original analysis.
For the record I am long ABK and MBI. I began buying ABK and MBI after reading several articles on aforementioned companies in Barron's, Wall Street, adn IBD, as well as noting how large funds(Davis Select, Third Avenue), and other investment firms ( Warburg) with much more knowledge than I, stated how undervalued for the "long term" these companies were [are]...

Ambac, MBIA Are Still Shorts Amidst This Wink-and-Nod

I cannot for the life of me understand how arguments against the monolines are refuted and the monlines themselves are affirmed their ratings by comapnies that have been around for quite some time, and are supported and looked upon for guidance by local and state goverments yet just about every article I read on Alpha Dog is against the monlines and mock the agencies that are looked up to. I bet if the rhetoric from Ackman and his ilk,(CNBC), the street.com, and Aplha dog stopped for just a few weeks people would realize what a waste of time it was to read what he and his backers, or should I say fellow shorters stated, and realize that these companies will recover and prevail. I wonder if the people who write here know more than Pincus, Davis fund, and other huge investors that have invested millions and millions of dollars..recently and at much higher stock levels than the present share price . Does anyone think that they would invest in a losing concern? I think not. I wonder if there will be articles written about other apects of the monolines, like ways they can procure new business with their affirmed ratings. Stop bashing, and lets help with thoughts and positive ideas...

The Jury is Still Out on the Monolines

I cannot for the life of me understand how arguments against the monolines are refuted and the monlines themselves are affirmed their ratings by comapnies that have been around for quite some time, and are supported and looked upon for guidance by local and state goverments yet just about every article I read on Alpha Dog is against the monlines and mock the agencies that are looked up to. I bet if the rhetoric from Ackman and his ilk,(CNBC), the street.com, and Aplha dog stopped for just a few weeks people would realize what a waste of time it was to read what he and his backers, or should I say fellow shorters stated, and realize that these companies will recover and prevail. I wonder if the people who write here know more than Pincus, Davis fund, and other huge investors that have invested millions and millions of dollars..recently and at much higher stock levels than the present share price . Does anyone think that they would invest in a losing concern? I think not. I wonder if there will be articles written about other apects of the monolines, like ways they can procure new business with their affirmed ratings. Stop bashing, and lets help with thoughts and positive ideas...

Thoughts on Ambac Bailout, MBIA, Berkshire's Muni Bond Backing

MBI announces in response to media and other inquiries concerning the "Ackman plan" presented to regulators and then widely disseminated last week by Mr. William Ackman, principal of Pershing Square Capital Management, the co today released a letter it sent on Friday, February 22 to the Honorable Eric Dinallo, Superintendent of the New York State Insurance Department and the Honorable Michael T. McRaith, Director of the Illinois Division of Insurance. "As we stated last week, we believe this proposal is simply a continuation of Mr. Ackman's campaign to profit from his short positions and credit default swaps in the bond insurance industry... Mr. Ackman has only two objectives: to impede the ability of companies who are trying to strengthen their financial resources to meet the needs of existing and future policyholders, and to further his own personal agenda and financial objectives. His calculated practice of using the media to broadcast his self-serving and misleading letters, reports and presentations is, we believe, clear evidence of his agenda. "At a time of critical importance in the financial guarantee industry, Eric Dinallo and the staff of the New York State Insurance Department and other regulators are working tirelessly to assist all financial guarantee companies to develop plans to meet the needs of all their constituencies... Assuring that these plans treat all policyholders on an equitable basis is an extraordinary challenge that requires thoughtful and careful evaluation. Mr. Ackman should let the officials charged with regulating the industry do their jobs instead of continuing a relentless media-driven campaign fueled only by personal financial gain."