I really could not beleive it when I first read it. In a letter to shareholders MBIA (MBI) Chairman & CEO Jay Brown actually penned the following
“But as the leading monoline, we are also a convenient and attractive target for self-interested parties such as Mr. William Ackman. Many of you have asked me in the past few days whether there is something personal between us. In actual fact we have many similarities. We are both extremely passionate in our beliefs and are persistent in overcoming all obstacles in terms of reaching our objectives. The real difference is that I am leading a regulated institution that provides security, jobs and peace of mind to tens of thousands of institutions and millions of individual investors. Mr. Ackman’s objective is less complex; he will stop at nothing to increase his already enormous personal profits as he systematically tries to destroy our franchise and our industry. His campaign against us has increased our cost of capital, but his intent to force a collapse has no chance to succeed.”
Let’s just forget that Ackman is giving 1/2 the profits to charity so this is not the shameless “self interest” thing Brown weeps of. Let’s also forget that Ackman first began predicting the current CDO situation in 2002. Let’s also forget that were it not for the self-serving bailout by the banks, MBIA and Ambac (ABK) would have indeed suffered the rating agencies downgrades and the very extinction Ackman predicted.
Now that we have put the actual events up to this point aside, aren’t facts a better defense to Ackman than essentially calling him names? Wouldn’t sitting there and pointing out the errors of his research that has been out there for a long time be more a effective way to rebut him? It would, but if Brown were to just look at numbers and profits and little things like that, he would find folks siding with Ackman in droves.
Is it any wonder to him that Berkshire Hathaway’s (BRK.A) Warren Buffett only wanted 1/2 the business? The answer is the other half is junk..
Brown would have been better served to ignore Ackman, not sit there and pout about him.
Disclosure (“none” means no position): None
