2008-06-19reuters.com

Moody's Investors Service on Thursday stripped the insurance arms of Ambac Financial Group and MBIA Inc of their Aaa" ratings, citing their impaired ability to raise capital and write new business.

Moody's said earlier this month it was likely to cut the ratings of Ambac Assurance Corp and MBIA Insurance Corp as plunging share prices and the high cost of accessing the debt markets made it challenging for the two largest bond insurers to raise new capital.

Isn't it great how the top reasons Moody's gives are really reactions to the solvency crisis which MBIA and Ambac are instrumental in bringing about, as opposed to their relevant fundamentals? Really, the lack of a "mea culpa" just looks farcical. Who is going to ever trust these guys again?


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