For the last few months I have been wondering why Martin Peretz -- a major supporter of Barack Obama who has used his perch as former editor-in-chief (now contributor) at the influential magazine The New Republic to promote his candidacy -- would be addressing the mortgage meltdown crisis in America with particular attention and ire focused on one company, MBIA. MBIA is a major bond insurer that has been a favorite of speculators and hedge-fund managers who have taken major trading positions that would benefit them greatly if the company's stock price collapsed. This has indeed happened over the last few months, enriching investors who have profited handsomely. The financial health of these bond insurers -- as reflected in the strength of their stock and debt prices -- is vital to the operation of the mortgage market and thus the housing market. Investors can profit by trading strategies (going "bearish") that makem money when the prices of...(Read Full Post)