- 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
- Warren Buffett Sells More Moody's After Stock Rebounds
- Warren Buffett Beats Bill Gross As Best Investor - Bloomberg Poll
- Warren Buffett and Bill Gates to Hold Master Class in CNBC Special
RSS FEED
MOST SHARED
- Sweeping Health Care Overhaul Bill Passes House
- US Becomes Top Country Brand Under Obama: Survey
- BofA Board in Civil War Over Lewis' Succesor
- What Stocks to Buy Amid Health Care Overhaul: Strategist
- GE, Comcast Agree on NBC Universal Valuation
- Kraft to Formalize Hostile Cadbury Bid on Monday
- Obama Delays Start of Asia Trip to Attend Memorial
- Tamminen: Why Does Oklahoma Want To Drown New York?
- Food Network, HGTV Drive Scripps Networks' Upside Surprise
- Tommy Lee, Medical Tourism and Nasty Santa, Your Emails
- U.S. Markets Gain 3% for the Week Despite 10.2% Unemployment
- Disney's 'Carol' Tests Widest 3-D Release Ever
- Stimulus II? Jobs Tax Credit=Cash For Clunkers
- Rockwell Automation Earnings: What Options Are Saying
- Gold Will Touch Higher Lows and Higher Highs: Analyst
- Is Misery Alive And Well in Your Office?
- Kraft to Formalize Hostile Cadbury Bid on Monday
- GE, Comcast Agree on NBC Universal Valuation
- US Health Care Reforms Face Tough Path in Senate
- Northrop to Sell $1.65 Billion Unit to Private Equity
- Obama Delays Start of Asia Trip to Attend Memorial
- China Urges US to Control Deficit to Stabilize Dollar
- BofA Board in Civil War Over Lewis' Succesor
- US Home Values Follow Sales Higher, For Some
- Hottest Zip Codes for Home Prices
Warren Buffett Watch
Text Size 
Warren Buffett tells CNBC this morning that he has a plan to help the troubled bond insurance situation, but so far it's not getting a very warm reception.
In a live telephone call to Squawk Box, Buffett offered to reinsure $800 billion in municipal bonds now insured by Ambac, MBIA and FGIC, effectively giving them a AAA credit rating.
 |
Warren Buffet |
Those insurers are in danger of losing their AAA credit ratings due to problems with subprime mortgages and other loans.
Buffett tells us he sent that offer to the bond insurers last week, and that he's giving them 30 days to find a better deal.
Buffett says one bond insurer turned him down, and he hasn't yet heard from the other two. Buffett wouldn't say which company turned him down. He said he didn't think regulators could do much to force the bond insurers to accept his offer, unless they took over the companies themselves.
The billionaire says this is an offer designed to make Berkshire Hathaway money, not to just do a good deed. He is not offering to take on liability for other, riskier investments insured by MBIA, Ambac and FGIC, such as CDOs. That makes the deal potentially unattractive to the insurers, because they would be left with the 'bad' risks.
Why go public? It seems to me that Buffett is trying to put some pressure on those insurers to take the deal by talking about how the financial world would be reassured should all those bonds get Buffett's AAA backing.
New York State's top insurance regulator, Eric Dinallo, has issued a statement saying, "I am pleased that this provides one option to protect municipal bond issuers and investors."
STOCKS IN 'GENERAL RANGE OF FAIR VALUE'
During the conversation, which lasted nearly half-an-hour, Buffett also said he thinks stocks right now are in the "general range" of fair value.
He also answered questions on a number of other topics, including a plan from six financial lenders to reduce foreclosures, the Presidential election, and his U.S. dollar "worth less" comment last week in Toronto.
I'm preparing a transcript of the entire conversation, which will be posted later here on Warren Buffett Watch. Meanwhile, enjoy these video clips (in two parts) so you can hear exactly what he said.
Current prices:
Berkshire Hathaway [US;BRK.A
Loading...
()
]
Ambac [ABK
Loading...
()
]
MBIA [MBI
Loading...
()
]
Questions? Comments? Email me at
- Warren Buffett Calling CNBC's Squawk Box Tuesday on Bond Insurance Situation (February 11)
- Warren Buffett Says Berkshire Not Interested in Troubled Bond Insurers (February 6)
- State Regulators Working with Berkshire Hathaway on Nationwide Bond Insurance License Application (January 28)
- Berkshire Hathaway's Jain Tells CNBC He's Talking "Right Now" With Bond Insurers About Possible Purchase or Partnership (January 9)
- Warren Buffett's Muni Bond Insurer "Tip-Toes" Into Market With $10M NYC Bond (January 9)
- Warren Buffett Promises to Stay on the Straight and Narrow with His New Bond Insurer (December 28)
Data is a real-time snapshot *Data is delayed at least 15 minutes