The WSJ had an article about the mortgage insurers, and you only had to read one line. Here it is:
Predictions of the demise of bond insurers could be premature, particularly if they succeed in securing lifelines from a deep-pocketed insurance salesman in Omaha, Neb.
Re-insurance from Buffett would knock one of the pegs from the stool that the bears were standing on in their hysterical laced Armageddon they've envisioned for the stock market. Remember two years ago, when no-one wanted to write any hurricane insurance? Mr. Buffett stepped up to the plate. How did that bet pay off? The idea that Buffett is looking to be a lifeline to the reinsurance industry indicates that severe overpricing of risk currently exists in the marketplace and these assets are being under-valued at today's prices. Blackstone yesterday, said that sub-prime was particularly interesting at these levels.
Market players should take heed to what the smart money is now doing.