This Will Help Lending (Not)
Another part of the Ponzi scheme getting a downgrade warning.
"Bond insurers are suffering as a result of their roles as guarantors of mortgage-related securities, and downgrading them could affect all markets in which they are active, including the municipal bond, commercial mortgage-backed securities, and other structured finance areas," Tanya Azarchs, a credit analyst for S&P, wrote in a note to investors. "In turn, dislocation in those markets could affect banks."
So, what happens to prices when there's no one holding the bag, because there is, in fact, no bag?