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Jim Dandy to the Rescue

If there was any really positive news today to justify the Dow and S&P 500 gains, it escaped me. It looks as though today’s gains were attributed to Warren Buffett’s “rebuffed” offer to bail out bond insurers Ambac Financial Group Inc., MBIA Inc. and Financial Guaranty Insurance Co. But, can this be considered good news for the economy? I don’t think so.

When things get desperate, one will try to put a positive spin on just about anything. How did Wall Street react today to Warren Buffett’s offer, which likely won’t materialize? Just watch.

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Comments 3

  1. Mike wrote:

    In case anyone’s wondering why the credit rating of bond insurers is important, and all the hoopla about a Warren Buffett bailout, there’s some good information to be found about recent failed municipal bond reset auctions at two good blogs:

    1. Accrued Interest
    2. Indextown

    It’s very interesting, and also enlightening.

    Posted 12 Feb 2008 at 11:20 pm
  2. Mike wrote:

    Here we go again..

    MBIA, Ambac Credit Ratings Under Threat at Moody’s

    June 4 (Bloomberg) — Moody’s Investors Service placed the Aaa insurance ratings of MBIA Inc. and Ambac Financial Corp. under review for a downgrade for the second time this year after the two largest bond insurers reported wider losses from the mortgage-market slump.

    Posted 04 Jun 2008 at 4:04 pm
  3. Mike wrote:

    Welp.. it’s a done deal.

    MBIA, Ambac, $1 Trillion of Debt, Lose S&P AAA Rating (Update3)

    June 5 (Bloomberg) — MBIA Inc. and Ambac Financial Group Inc., the world’s largest bond insurers, had their AAA financial strength rankings cut by Standard & Poor’s, taking with them the ratings on more than $1 trillion of securities they guaranteed.

    The ratings were lowered two levels to AA, New York-based S&P said in a statement today. S&P said it would keep the ratings under review pending “clarification of ultimate potential losses as well as future business prospects, the outcome of strategic business decisions, and potential regulatory developments.”

    Posted 06 Jun 2008 at 8:07 am

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