Wednesday, December 5, 2007
MBIA facing downgrade
On monday MBIA went up about 15% on monday on the announcement of the Treasury Secretary's bailout proposal. Today Moody's said that MBIA may get it's credit downgraded sending share prices down almost 16% because MBIA's business model is predicated on a AAA credit rating. The lesson here is SHORT any and every pop. Pops is the price will be caused by talk of government interventions. You can't predict when they will leak bailout proposals, but you can predict that they won't be beneficial to the stock price in the long run, so make the money on the way back down.
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