tag:blogger.com,1999:blog-30643134.post2235928034756916281..comments2023-12-26T01:10:26.319-05:00Comments on Accrued Interest: I assure you, we are quite safe from your CDOs hereAccrued Interesthttp://www.blogger.com/profile/05096191765979971184noreply@blogger.comBlogger9125tag:blogger.com,1999:blog-30643134.post-77529099663134018882008-02-06T08:22:00.000-05:002008-02-06T08:22:00.000-05:00Measure:You win. I've already admitted I was too s...Measure:<BR/><BR/>You win. I've already admitted I was too sanguine on the insurers many times.Accrued Interesthttps://www.blogger.com/profile/05096191765979971184noreply@blogger.comtag:blogger.com,1999:blog-30643134.post-59600177089728723652008-02-05T19:37:00.000-05:002008-02-05T19:37:00.000-05:00Update:In Dec 2007, Calculated Risk reported on an...Update:<BR/>In Dec 2007, Calculated Risk reported on an issue that went from AAA to worthless in less than a year. That's right, they defaulted:<BR/>http://calculatedrisk.blogspot.com/2007/12/from-aaa-to-worthless-in-less-than-year.htmlAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-30643134.post-36275799809572097542007-12-06T04:50:00.000-05:002007-12-06T04:50:00.000-05:00You are wrong interest,very wrong. if the bonds th...You are wrong interest,very wrong. if the bonds they insure get downgraded or the ABX keeps going down THEY WILL HAVE TO MARK TO MARKET, just not in the same scale as citigroup. that will be a charge against their earnings(indeed q3 was negative for mbia) and that will lower their capital necessary for AAA rating, once they lose the rating MBIA is going to 0 100%¨guaranteed, no one is going to bailout someone who holds billions of CDO exposure.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-30643134.post-77316635137702607312007-08-17T15:39:00.000-05:002007-08-17T15:39:00.000-05:00Sorry, here is the linkSorry, here is the <A HREF="http://www.designs.valueinvestorinsight.com/bonus/pdf/IraSohnFinal.pdf" REL="nofollow"> link </A>Rameshhttps://www.blogger.com/profile/04788687800334639382noreply@blogger.comtag:blogger.com,1999:blog-30643134.post-11170946480784076172007-08-17T15:38:00.000-05:002007-08-17T15:38:00.000-05:00There's an alternative view about MBIA here -http:...There's an alternative view about MBIA here -<BR/><BR/>http://www.designs.valueinvestorinsight.com/bonus/pdf/IraSohnFinal.pdfRameshhttps://www.blogger.com/profile/04788687800334639382noreply@blogger.comtag:blogger.com,1999:blog-30643134.post-61373162441534028182007-08-07T12:46:00.000-05:002007-08-07T12:46:00.000-05:00Re: Borrowing at LIBOR+5Many large financial insti...Re: Borrowing at LIBOR+5<BR/><BR/>Many large financial institutions (buy and sell side) can borrow at even below LIBOR, near the risk-free treasury rate. This is done by offering treasuries they own as collateral, which is essentially risk-free.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-30643134.post-41439615706364565422007-08-06T14:11:00.000-05:002007-08-06T14:11:00.000-05:00Barry:Thanks. While it is complex, I wish more MSM...Barry:<BR/><BR/>Thanks. While it is complex, I wish more MSM reporters took the time to understand the situation before reporting on it. As for the blog, its a labor of love.<BR/><BR/>David:<BR/><BR/>MBIA said in their conference call on Thursday that they are mostly in the senior-most tranche, although I don't remember them actually giving a statistic there.<BR/><BR/>Anyway, the negative basis trade isn't riskless at all. But it becomes more like counterparty risk and less like CDO risk.<BR/><BR/>As for borrowing at L+5, commercial paper is usually rich to LIBOR. So we're talking about very highly rated banks and insurance companies who are usually involved in negative basis trades.Accrued Interesthttps://www.blogger.com/profile/05096191765979971184noreply@blogger.comtag:blogger.com,1999:blog-30643134.post-24118047579063427062007-08-06T13:50:00.000-05:002007-08-06T13:50:00.000-05:00Great blog. On the negative basis trade, is it tr...Great blog. On the negative basis trade, is it truly riskless? Supposedly, MBIA mainly insures super-senior AAA CDO risk, where there are some AAAs in front of them.<BR/><BR/>Is it possible that not all of the AAA bonds are getting wrapped here? Also, who gets to borrow at L+5? That seems pretty aggressive. Do they have to offer their AAA bonds as collateral?<BR/><BR/>Thanks. I regularly read your work.David Merkelhttps://www.blogger.com/profile/05073877918072914309noreply@blogger.comtag:blogger.com,1999:blog-30643134.post-999272838359500592007-08-06T13:49:00.000-05:002007-08-06T13:49:00.000-05:00Nice explanation of a complex situation.This blog ...Nice explanation of a complex situation.<BR/><BR/>This blog is rapidly becoming a regular stop for me!Ritholtzhttps://www.blogger.com/profile/08608448405502237269noreply@blogger.com