Crocodilian

MBIA, Ambac and GICs: The Other View

Here's one more ABK puzzle: one of their largest and most outspoken holders is part of Evercore, a well known LBO firm. If there were value in ABK that is not presently recognized in the market, one would have thought that an LBO shop with a big stake in ABK equity would have been able to find a cash buyer for the company . . . that hasn't happened though.

MBIA, Ambac and GICs: The Other View

Fascinating, but here's the rub: finance is about belief. They're called "credit" markets for a good reason-- and Ambac now falls afoul of the charge that can't be answered "I don't believe you". Unlike a contrarian play in say a diamond mine which no one else believes in, a company which depends on credit cannot "convince the doubters" -- if they've grown strong, their doubt ends up impairing the business of the company. I may not believe your seismology, but if you find diamonds in your mine, I'll have to accept that. . . . mining companies are often speculations in that way, and people can live with it. What role in the market is there for a speculative insurance company?