The news of the day today for the stock market was Warren Buffett and his offer to bond insurers. Buffett offered to reinsure $800 million worth of municipal bonds through Berkshire Hathaway, his holding company. Buffett said that he has offered to resinsure these bonds held by MBIA (NYSE:MBI), Ambac (NYSE:ABK), and Financial Guaranty Insurance Company. 
Already Ambac has turned down this proposal by Buffett saying the offer by Berkshire Hathaway is not in its or its shareholders best interests. The others haven't been heard from just yet, but it is rather likely that they will also turn down Buffett's offer.
The stock market shot higher on the news of Buffett's offer today, but the reality of the matter is, it does little to change the landscape of the real issues that these bond insurers face. Buffett's offer wouldn't help at all on the subprime security side, also known as CDO's. The CDO's are precisely what has been crushing the backs of the bond insurers. Most who assess Buffett's bid say the same thing, this is simply an offer that Buffett put out there that would have helped Berkshire Hathaway in a tremendous way, nothing more.
Those who initially saw this offer as a great sign for the troubled bond insurers are likely to see it for what it really is after taking some time to figure the whole situation itself. Anytime Warren Buffett's name is in the news making an offer, the street gets excited, and rightfully so, but in this case I caution everyone to look at the facts and see that this really isn't the saving grace we need that it initially appeared.
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