Wednesday, January 9, 2008

Warren Buffet Buys NYC's Bonds (and a Hillary footnote)

In today's New York Times, Berkshire Hathaway is now backing New York City's bonds. Insurance is regulated by the state, and it normally crawls along at a glacial pace- which only encourages calls for centralized federal regulation.
    Shortly before Thanksgiving, Eric R. Dinallo, the insurance regulator for New York State, did something unusual. He called Warren E. Buffett’s right-hand man on insurance, Ajit Jain, and suggested that he start a new company to insure municipal bonds in New York.

    Mr. Jain, who oversees one of the biggest insurance portfolios in the business at a subsidiary of Mr. Buffett’s holding company, Berkshire Hathaway, was surprised. He had never heard from an insurance regulator offering a new business idea.

What's the big deal? Well, a few million bucks every year, that's what. Berkshire Hathaway has a triple A rating, and NYC's bond rating is double A. The difference in interest between the two ratings is in the millions, and kudos to Dinallo for adjusting to the times. Now maybe the city will have enough money to pave roads flat.

And this is an irrelevant aside, but I would just like to take a few blog seconds to thank the lovely voters of New Hampshire for voting for Hillary. To be honest, I'd be happy with any of the Democratic candidates at this point (I'm still undecided), but I have a special place in my heart for Hillary to do well. The sexist double standard rampant in the media is appalling even to my jaded view, and I want her to represent. So in words so 1992, you go girl! (snap, snap, snap)


Ms. M&P said...

I'm going to have to read that NYT article--it sounds interesting, although I don't think I entirely understand it...maybe it's because I'm drinking...

HRC inspired one of my posts today. I am so fed up with the media's spin on her and I had to speak up about it or implode. I wholeheartedly agree with you!!

PiggyBankBlues said...

hey, pass some of that over here!

i'll go check out what you wrote- i just knew you'd hit on it!