Guess the "ripple effects" are here (if you didn't think they were already)...

Concurrent with its related rating announcement earlier today on MBIA Inc. (MBIA) and its financial guaranty subsidiaries, Fitch Ratings has placed 173,022 bond issues (172,860 municipal, 162 non-municipal) insured by MBIA on Rating Watch Negative.

Fitch placed MBIA's 'AA' long-term rating and 'AAA' insurer financial strength (IFS) rating on Rating Watch Negative following the rating agency's updated assessment into MBIA's current exposure to SF CDOs backed by subprime mortgage collateral and various CDO-squared transactions, as well as MBIA's exposure to RMBS.

Remember when people used to say municipal bonds were "safe"? That was back before the `AAA' rating was polluted into meaninglessness and the municipalities all started going bankrupt. This is not your father's bond market...

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