- Warren Buffett Ranked #14 On Forbes 'Most Powerful People' List
- Warren Buffett and the Crisis: 'Brilliant Moves Interspersed with Some Surprising Errors'
- Warren Buffett to Sell Stakes In Union Pacific & Norfolk Southern
- BNSF CEO: Buffett's Bid for Railroad "Warmly Received" In Washington
- Berkshire Hathaway's NetJets Furloughs 495 Pilots
- Buffett's Berkshire Hathaway May Lose Only Remaining AAA Credit Rating
- Buffett to CNBC: Berkshire Talking to 5 Firms About Buying Tax Credits
- CNBC Transcript: Warren Buffett Explains His Railroad 'All-In Bet' on America
- Warren Buffett to CNBC: Berkshire Businesses Doing 'Just a Tick Better'
- Warren Buffett Tells CNBC Burlington Northern Buy Is 'Bet' On America
RSS FEED
MOST SHARED
- Hewlett-Packard to Acquire 3Com for $2.7 Billion in Cash
- How the Droid and Google Threaten the GPS Makers
- Dollar Trouble, Oil's Bubble Could Derail Recovery
- CNN Anchor Lou Dobbs Says He is Leaving Network
- USC Football Blog Leads All-Access Space
- Shopping for Answers
- HPQ to Acquire 3Com
- Rising Jobless Biggest Threat to World Trade: WTO
- APEC Pledges to Back 'Market-Oriented' Currencies
- Pricier Beer Helps AB InBev Operating Profit
- What to Expect From Disney Earnings?
- HP's Shot Across Cisco's Bow
- USC Football Blog Leads All-Access Space
- Clowning Around At Work
- Ahead of Earnings Disney Restructures Studio
- Nov. 11: Unusual Volume Leaders
- 3 'Clear Sailing' Mid-Caps For Investors: Strategist
- Intimate Apparel Sales Heating Up: Maidenform CEO
- A Day On The USS Harry S. Truman
- US Mortgage Refinancing Up; Buying Demand Sinks
- Rising Jobless Biggest Threat to World Trade: WTO
- Gold Hits $1,122, Barrick Chief Says Selloff Possible
- Wall Street Pay Is Often too High: Bill Gates
- Morgan Stanley Gets Aggressive in Luring Brokers
- Foreclosures Fall Again But Improvement Likely Fleeting
- Highest State Foreclosure Rates
- Yuan Critics Want Obama to Keep Campaign Promise
- Obama Most Powerful Person in World: Forbes
Warren Buffett Watch
Text Size 
 |
Mark Lennihan / AP Warren Buffett's new municipal bond insurer has written its first policy, backing a $10 million bond issued by New York City. |
Ajit Jain, who runs Berkshire's insurance businesses, tells the New York Times, "We're tip-toeing into the market, doing very small deals. We want to see if we can get the pricing that we find acceptable to us. Once we find this is real, we'll put in a lot more capital."
UPDATE: IN A LIVE INTERVIEW ON CNBC'S STREET SIGNS TODAY, JAIN REVEALED THAT BERKSHIRE IS TALKING "RIGHT NOW" WITH BOND INSURERS ABOUT A POSSIBLE PURCHASE OR PARTNERSHIP.
That cautious approach is exactly what Buffett himself was talking about when he first revealed plans for the muni bond insurance business late last month. He made it clear to the Wall Street Journal that Berkshire wouldn't be making the same mistakes, charging too little and taking on too much risk, as the now-struggling bond insurers Ambac [ABK
Loading...
()
]and MBIA [MBI
Loading...
()
].
Jain also told the Times Berkshire's move into bond insurance was pushed forward by New York State's top insurance regulator Eric Dinallo, who called Jain to suggest Berkshire get into the business.
According to the newspaper:
"As it turned out Berkshire Hathaway was trying to figure out how to capitalize on the troubles in the municipal bond market and was ready to move when the phone rang. Both sides came together in a meeting in New York. 'We talked very quickly and we reached middle ground on a number of issues,' Mr. Jain said."
 |
NYS Insurance Dept. Eric Dinallo, Superintendent of the New York State Insurance Department, phoned Berkshire Hathaway's Ajit Jain to suggest new bond insurer. |
Jain describes Dinallo in glowing terms. "He's 180 degrees apart from the regulators I’ve dealt with. He’s a guy in a hurry. He’s constantly pushing. He called me up personally and made his pitch. He said, 'This is a very important issue for me personally and for the department.'" (The Times headline calls Dinallo a "Regulator Not Stymied by Red Tape."
Dinallo tells the Times he called Berkshire into the game because he was worried that a time could come when New York entities wouldn't find enough willing buyers of their bonds if they couldn't be insured. "I needed to make sure we had adequate capacity to insure municipal bonds."
Update: Dinallo appeared Wednesday evening (January 9) with Jim Cramer on CNBC's Mad Money to talk about why he approached Berkshire. Cramer also discounted the possibility that Buffett might come in and buy Ambac or MBIA, asking why Buffett would want to buy the competition when he's poised to crush it instead.
Questions? Comments? Email me at
Data is a real-time snapshot *Data is delayed at least 15 minutes