I just talked to Eric and said, "um are we the only 2 people that realize these monolines like MBIA and AMBAC are pulling some funny business?" Eric said "yep". It sure looks like it. Now if you look to the right of this page in the archives we've been railing on these monolines for over a year. Well MBIA and AMBAC both released earnings today that were LOWER then estimates by analysts. Obviously, the analysts dont read monkeybusinessblog.com cause theres no way these 2 companies would go lower then our estimates if you know what I'm saying. Now what is clear is that MBIA and AMBAC officials read this blog because they seem to respond to us every time we write about them which I must admit hasnt been often lately due to the fact that I thought they were dead.
I guess they arent dead because the stocks were able to go down another 25% or so today after these "shocking" earnings announcements. Let me spell it out for people and I welcome the MBIA and AMBAC guys to respond to this. When a person holds a bond and it pays say 50 for arguments sake, and you can sell that bond and pay someone only 10. You keep 40. Nice deal right? If you are the guy who takes the 10 and KNOWS the other guy is getting 50 you are an assclown right? Well this is the business MBIA and AMBAC chose. You know what they used as an excuse? They didnt have to put much capital aside to protect against a falling price against this asset because it was AAA. So it was like a "free 10 in their pocket" or a "riskless 10". Now that those bonds are in the crapper we all know it wasnt a free or riskless 10. But theres something else that bothers me here.
They seem to be taking their sweet time marking these "riskless assets" to the market. So they keep dropping earnings bombs every quarter hoping and praying these prices go up. But they arent yet. You know what really frosts my ass though? They are asking for our taxpayer dollars via the $700bn bailout program because they went hogwild into this market for these assets when they knew other guys were getting paid 50 for and they gladly took 10. For chrissakes, they are called MONOLINES because that means 1 line of business. Which was insuring municpal bonds. This business of excepting "the riskless 10" was diving headlong into the subprime business. A new business. I dont think them accepting just 10 on these trades was stupidity either, thats some form of arrogance or something. Now they ask us to bail them out? You know how all these actors said they would move if Obama lost? (Alec Baldwin said he would move if John Kerry lost but hes still here). Well if the Fed gives money to these assclown monolines, I might move. Maybe to Cuba where at least I know they call it communism and I can expect crazy stuff to happen. The cigars are good there too.
Comments