Oh its not even being talked about. I'm just throwing out a situation that could apply if things turned out much worse than anticipated.
It was one of the things I looked into though as I had looked into when doing my due diligence. It would not alter my view of the share value and is one of the things that MBIA bears are wrong about.
It does not matter. MBIA executives have indicated that the surplus note holders essentially own MBIA Insurance.
Probably time for the company to change the name of the parent company so people do not confuse the liabilities of MBIA Insurance with MBIA Inc.
Panic selling over issues such as Zohar and Puerto Rico can happen again. It would be foolish but it could happen.
Zohar is an absolute non-issue even if it drags MBIA Insurance into rehabilitation and Puerto Rico default loss possibilities are small relative to the potential losses already embedded in the share price.
Trading around 57% of par. Don't have any opinion on whether I'd buy them as I don't understand the structured finance products well enough to have an opinion. Fairly sure MBIA management thinks they are trading too high based on statements in the last call.
MBIA would buy them if the price was right. What that price would be I don't know.
The surplus notes may be accounted for as debt but management said they in effect owned the structured finance insurer in the last call. Not sure who owns the surplus notes now.
Pretty hilarious. The banks were right that the entity was "built to fail" but being right doesn't always mean you win in a court of law. State of New York should be ashamed of itself.
Those were not sales in the normal sense of the term. They had warrants to purchase at $30 a share that were acquired early in the financial crisis that expired worthless.
All the years of expecting this to happen and finally seeing it is nice. Only wish I had the courage to stay short.
Who knows, maybe it bumps up in short-term but over the medium term I don't see how it trades above 50 cents.
Anyone who thinks PE is an appropriate valuation measure for this company is not exactly familiar with the accounting and risks that it faces.
I agree that they will likely become insolvent but they have spent a good portion of their existence in such a state. For some reason they are able to keep raising money.
Tend to think someone would buy the assets just to keep them from winding up in the hands of private equity. On one of the recent share issuances the legal documents were drafted such that it was an either/or transaction. In other words they almost sold out rather than issue shares. Doesn't mean they had a solid buyer but they definitely were talking to someone. That is the reason I would go long at 30 cents. Might lose it all but I make bets like that.
Almost, woulda, coulda.
Was ready to short the day they "announced" the partnership with Nokia but the share price didn't pop the way I expected and didn't get filled.
I'll go long if it goes to 30-40 cent range.
Honestly not sure. Could be they think that PR (and/or PREPA) will default and it will cause a spike down. Might be Zohar. Might be something else. My guess is that someone is betting on PR default panic.
There is a chance PREPA does default over the short-term. No denying that but I think even if they do the ultimate recovery will be good. Put buyers are just hoping for a stampede. That is my guess but who knows.
This is the subsidiary holding the structured finance products. More or less the "badco" from the restructuring to hold toxic assets.
Company said it was worthless in the 4th quarter call (as far as shareholders go). The surplus note lenders, a note considered equity for regulatory purposes, is now the owner of the company in terms of economics. They bear the risk of loss from the Zohar stuff, not MBIA Inc.
Banks who brought the Article 78 litigation have now effectively been proven right. MBIA Insurance was built to fail. Fortunately for MBIA shareholders they have plenty of assets in National Public Finance.
Cannot wait for the next Prescience Point report.
I've been thinking about looking into whether it is possible for an individual investors to bring suit against them for fraud. Company really can't do it because of discovery but an individual on the other hand...
It is freakin hilarious how they always get it wrong but still, someone really needs to stop them.
Yea you are right. Now they need ten days in a row above a dollar.
It is off for at least a few months. Very difficult to sell bonds when a company is accused of fraud as it just doesn't pay. Even a 5% chance of fraud when combined with the difficulties of negotiating the Indian legal system makes it very hard to do a deal at a reasonable price.
They plan to rely on Indian banks until things clear up and they will. Basic result is that they continue to outsource certain capabilities that they wanted to bring in-house. Costs them money but less than the additional interest bond holders would have demanded.
The gift that just keeps on giving. Pretty soon so many people will be following them around doing the exact opposite of whatever they say that their hit jobs will have no impact.