Wednesday, January 23, 2008

Markets Gone Wild

Voltron says: Market down 300 then up 300. Crazy. Good chance to short MBIA. I have not mentioned it much on this blog. They insure mortgage backed securities against losses. If they lose their triple-A credit rating, they will go out of business. They've been told by Moody's and others that they need to raise two billion dollars to keep their credit rating. They had to pay 14% interest in order to raise new capital! Triple-A rated companies usually pay around 5-6%

1 comment:

M said...

Thanks Tron for the update...personally I've been sweating the boom happening in MBI right after I got back in for a May $15 Put. Hope to see it start coming down again. I'm assuming you'd recommend to ride it rather than cut losses and get out? Not sure how survivable they are if the Feds keep "helping?"