voltron says: MBIA's CEO was fired. The old CEO was brought back. They are in discussions to split into two parts, municipal bond insurance (bread and butter) and structured debt insurance (toxic waste). If this happens, your broker may force you to cover your short position. If not you will be short both companies. I would not be so quick to cover the municipal bond side, because they are likely to get sued by the structured debt insurance holders and the need for municipal bond insurance is being questioned. It is also a business that Warren Buffett is entering, and I could even envision the federal government taking over the role.