Major bond insurers are having issues right now concerning their ratings, as The Street reports:
The firms ran afoul of the ratings agencies by choosing to backstop esoteric collateralized debt obligations pooling mortgages and other risky debt, which have seen increasing defaults as the housing and credit bubbles burst in the second half of 2007.
What's being done to fix this? Well, interestingly, Warren Buffett is offering to reinsure the bonds. Collateralized debt obligations and other ill-advised investments are causing problems, and insurers are being offered a way out. However, two are mulling the thought. One has rejected the offer. But Buffett's offer alone was enough to give the stock market a bit of a boost today.
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