Shocked. Just Shocked.

So the shitpile has its own little shitpile - CDOs-squared. Nice. We're shocked to find that gambling was going on in there. Bloomberg (12.20.07), via Eschaton:

"MBIA Inc. fell the most since 1987 in New York trading after the world's biggest bond insurer disclosed that it guarantees $8.1 billion of collateralized debt obligations that investors say have a greater chance of losses.

"'We are shocked management withheld this information for as long as it did,' Ken Zerbe, an analyst with Morgan Stanley in New York, wrote in a report yesterday. 'MBIA simply did not disclose arguably the riskiest parts of its CDO portfolio to investors.'"

MBIA Bond Risk Soars on $8.1 Billion CDO Disclosure

"The company posted a document on its Web site late yesterday showing it insured $8.1 billion of so-called CDOs-squared, which repackage other CDOs and securities linked to subprime mortgages."

Turns out these things have been around a while.