Warren Buffett's latest proposal for the troubled bond insurance industry is no help to MBIA(MBI Quote) and Ambac (ABK Quote), but it could be the best free market solution for everyone else.
On Tuesday, the legendary investor and CEO of Berkshire Hathaway (BRKA Quote) disclosed a letter he sent earlier this month to the two largest bond insurers, as well as privately held Financial Guaranty Insurance, offering a second level of insurance on up to $800 billion of the municipal bond underwritings at the companies.
Buffett wants no part of the structured finance underwritings that have plunged the industry into turmoil in recent months amid a rash of defaults in collateralized debt obligations, or CDOs, tied to risky mortgage loans. He's offering to take over the most stable part of the bond insurance business, and leave the bond insurers to deal with the rest. ...
Recent Comments
| Dow Jones | S&P 500 | NASDAQ | 10-Year Note | |
|---|---|---|---|---|
| 10,388.90 | 1,105.98 | 2,194.35 | 34.83 |
Oil *
77.74
|
|
UP
22.75
|
UP
6.06
|
UP
21.21
|
UP
1.03
|
10 Yr
3.48%
SPDR Gold
113.75
|
|
+0.22%
|
+0.55%
|
+0.98%
|
+3.05%
|
Data delayed 20 minutes |
Connect with TheStreet