http://www.cnbc.com/id/15840232?video=613034036
Bill Ackman of Pershing Square Shorting MBI:
http://pershingsquare.valueinvestingcongress.com/files/How%20to%20Save%20the%20Bond%20Insurers.pdf
We agree with Marty that Mr. Ackman is a great salesman. But looking at Bill's trackrecord and his past analysis in a couple of situations, we think Mr. Ackman is quite thorough at investment analysis as well. In terms of experience in the bankruptcy field, we do think Marty has an upper hand.Now that Warren Buffett stepped into the bond insurance game, would his move make it easier for MBIA to find new capital infusion that Marty is talking about?
Is MBI a case too hard for us? Who do you think is right here?
Please post your comments.
1 comment:
If you do mark-to-market valuation for the bonds they are insuring, these companies are in deep trouble.
However, if you hold on to these bonds to maturity or participate the bankruptcy proceedings, the long term average loss on their bonds are quite low. So liquidation value assuming hold-to-maturity and based on historical loss ratio, you may have value here.
The bankruptcy of ACA, another Martin Whitman purchase, is a big concern. Are these insurers big black financial holes too hard to analyze without the details of their insurance contracts?
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