Dinallo on MBIA / FGIC Deal

29 Aug 7:27am
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If MBIA (MBI, Ambac (ABK) or FGIC fail, it won't be because the NYC Insurance Commissioner did not do all he could to assure their survival. Berkshire Hathaway (BRK.A) was a bidder for the book also.



I think those who are still short on MBIA or Ambac have seen the most of their gains. If the NYC Insurance Dept. has not moved to force actions from either company that would wipe out shareholders at this point, I don't think one should be thinking they will.

Dinallo does make the point that while large, heavily populated municipalities may not need the bond insurers, there are "thousands" of small municipalities that do need it. It that sense, the business of both companies is still needed.


Disclosure ("none" means no position):
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ToddSullivan

A Massachusetts based value investor, I look for companies whose current valuation is at a discount to their true value. When I purchase a stock, my typical holding period is several years. I consider buying a stock purchasing a piece of a business. I am confident once I make a decision to buy that eventually the market as a whole will recognize the true value of the business and value it accordingly. It may take 1 month, 6 months or a year, but if I buy it at enough of a discount to its true value my results will be (and have been) superior to the market as a whole. Of all the disparate investing disciplines, value investing has stood the test of time. The great investors of have all been value investors. Warren Buffett, Ben Graham, Bill Ruane (Sequoia Fund), Bill Miller and Wally Weitz, all have consistently outperformed the market for decades by using various forms of value investing. Currently I am a contributing writer to Seeking Alpha, Vinvesting.com, The Stock Masters and Value Investing News. Posts have been reprinted in The Wall St. Journal, Yahoo Finance, Google Alerts, Google Finance, TheStreet.com. 24/7 Wall St. and Topix.net.