Comments on: MBIA Tells Nasty Fitch to Go Away; Ambac’s Friends Manipulate Market http://www.nakedcapitalism.com/2008/03/mbia-tells-nasty-fitch-to-go-away.html Sun, 22 Nov 2009 07:56:24 -0500 http://wordpress.org/?v=2.8.4 hourly 1 By: Francois http://www.nakedcapitalism.com/2008/03/mbia-tells-nasty-fitch-to-go-away.html#comment-4886 Francois Sat, 08 Mar 2008 22:44:00 +0000 http://www.nakedcapitalism.com/2008/03/mbia-tells-nasty-fitch-to-go-away-ambacs-friends-manipulate-market/#comment-4886 Man! If I was Fitch's CEO, I'd be delighted. Man! If I was Fitch’s CEO, I’d be delighted.

]]> By: Anonymous http://www.nakedcapitalism.com/2008/03/mbia-tells-nasty-fitch-to-go-away.html#comment-4878 Anonymous Sat, 08 Mar 2008 18:22:00 +0000 http://www.nakedcapitalism.com/2008/03/mbia-tells-nasty-fitch-to-go-away-ambacs-friends-manipulate-market/#comment-4878 They want the shorts to burn their fingers repeatedly and give up and go short someone else. When it comes to the health of the bond insurers, perceptions matter more than reality, and a "healthy" stock price is prerequisite to maintaining that perception. Gotta keep it out of penny stock territory at all costs.<br/><br/>Think about it: if banks were willing to seriously consider investing a few billion into Ambac to forestall having to do even larger writedowns, why not toss a mere trifling throwaway $10 million or so into a hit-and-run short squeeze, even if it was a dead loss?<br/><br/>It's worth a shot from their point of view, even if it probably won't work, because the other side can surely figure out a way to profit from predictable yo-yo volatility. And who knows? Maybe naive retail investors will buy into it at some point and start pushing the price up.<br/><br/>The whole bond insurer rescue drama playing out over the past few months has been an exercise in grasping at straws. What's one more straw?<br/><br/>Expect the next shoe to drop at option expiry time if not sooner. They want the shorts to burn their fingers repeatedly and give up and go short someone else. When it comes to the health of the bond insurers, perceptions matter more than reality, and a “healthy” stock price is prerequisite to maintaining that perception. Gotta keep it out of penny stock territory at all costs.

Think about it: if banks were willing to seriously consider investing a few billion into Ambac to forestall having to do even larger writedowns, why not toss a mere trifling throwaway $10 million or so into a hit-and-run short squeeze, even if it was a dead loss?

It’s worth a shot from their point of view, even if it probably won’t work, because the other side can surely figure out a way to profit from predictable yo-yo volatility. And who knows? Maybe naive retail investors will buy into it at some point and start pushing the price up.

The whole bond insurer rescue drama playing out over the past few months has been an exercise in grasping at straws. What’s one more straw?

Expect the next shoe to drop at option expiry time if not sooner.

]]> By: Anonymous http://www.nakedcapitalism.com/2008/03/mbia-tells-nasty-fitch-to-go-away.html#comment-4876 Anonymous Sat, 08 Mar 2008 15:35:00 +0000 http://www.nakedcapitalism.com/2008/03/mbia-tells-nasty-fitch-to-go-away-ambacs-friends-manipulate-market/#comment-4876 I don't get it. What benefit is there for any company in bumping up the price of the stock for such a short time? I can't think of anything gained if it all comes back off the next day. I don’t get it. What benefit is there for any company in bumping up the price of the stock for such a short time? I can’t think of anything gained if it all comes back off the next day.

]]> By: doc holiday http://www.nakedcapitalism.com/2008/03/mbia-tells-nasty-fitch-to-go-away.html#comment-4863 doc holiday Sat, 08 Mar 2008 08:43:00 +0000 http://www.nakedcapitalism.com/2008/03/mbia-tells-nasty-fitch-to-go-away-ambacs-friends-manipulate-market/#comment-4863 The whole market is designed to be goosed by multiple players now, like The Fed and rating agencies, while SEC and audits and accounting are out the window.<br/><br/>Also, Re: The more they stand apart from Moody's and S&P, the better they look. <br/><br/>If rating companies survive, it will depend on having integrity and not playing games like this. In reality, would you rather have a stock or bond rated by a game playing, political casino/mafia, or a company that seems on the level which is being hard nosed? MCO and S&P are devaluing and diluting their future value and decreasing future market share, which is just plain bad business! Boo! The whole market is designed to be goosed by multiple players now, like The Fed and rating agencies, while SEC and audits and accounting are out the window.

Also, Re: The more they stand apart from Moody’s and S&P, the better they look.

If rating companies survive, it will depend on having integrity and not playing games like this. In reality, would you rather have a stock or bond rated by a game playing, political casino/mafia, or a company that seems on the level which is being hard nosed? MCO and S&P are devaluing and diluting their future value and decreasing future market share, which is just plain bad business! Boo!

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