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Strategies & Market Trends : John Pitera's Market Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: ggersh who wrote (11593)	1/30/2009 9:54:26 PM
From: Hawkmoon	Read Replies (1) \| Respond to of 33421

You'd think so.. They were going to relax the capital requirements for the monolines, but that got rejected by the insurance regulators. Eric Dinallo was speaking on CNBC about some form of "bad bank" for monolines that would enable them to regain their AAA ratings by getting out of some of the obligations they have which would help the municipal bond market considerably. cnbc.com Banks are important, there's no doubt of that. But banks fail from time to time for extend too many bad loans. But it's the insurance companies that eventually wind up holding the bag, especially if the assets were fraudulently packaged with liar loans, and then given a AAA stamp of approval by a Rating Agency working in cohoots with the investment banks packaging the deal. The insurers were forced to offer "protection" and risk diversification on assets that had been negligently (fraudulently?) given AAA status. So what insurance company is going to be willing to provide financial surety unless they have sufficient capital to do so? Does the US government, and the American taxpayer, want to be in a position where they provide a financial guarantee for every bank loan? Geezus weeps.. I hope not!!! Hawk