ABK work overnight to raise capital from banks

Mar.10, 2008 in Market Outlook

it is just the matter of time,,,a bank bailout can take abk all the way to $20+ cuz it scure abk rating from all three agencies and strenthen its financial position for its future businiess,,, if any of bank like Citi, BAC,etc buyout ABK, and inject suffient funds that would actually make abk replace MBI as largest bond insure of this nation, looking good tho… since MBI is insure too much, don’t think anyone would be able to take care of it…sell mbi and buy abk is wise decision.

Who Really Pays for the Bailout?

The irony of this bailout is…. the money is coming from capital constrained banks such as Citigroup (C). These banks are piling into the biweekly super secret Fed auctions since they don’t want to show their faces at the discount window because that is a “sign of weakness” - please note, your stock dropping 60-70% is not a sign of weakness - but I digress…

So who is really paying for this bailout? You guessed it… the Fed. But they are using a middleman - the banks. See how it works? We provide the capital… banks go to TAF auctions to get the capital… banks give capital to Ambak (ABK)… and we all live happily ever after.

Personally, I will rejoice and pop champagne when this happens. So I don’t have to hear Charlie Gasparino talk about it pending every day when I am positioned for the market to fall, only to see my gains for the day evaporate and turn into losses as he done to me 3x in the past 2 weeks.

This changes very little - the underlying collateral is still in free fall, banks are still black boxes which refuse to provide transparency and are capital constrained, and the credit markets are seized up. But we can’t be bothered with those sort of details.

Now with this out of the way (hopefully) we can rally on the next bailout talk….

When everyone expects news, it is generally already priced in. So while the market likes to make fools of everyone making short term predictions, I’d say, gun to head, the marker sells off on the “news” portion of this long long long saga of a rumor.

Fed would injected money to banks and take care of ABK and MBI to ease some mortgage concern of the economoy.

http://seekingalpha.com/article/67354-ambac-is-halted-who-really-pays-for-the-bailout?source=yahoo

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