From Tom Woods Presentation this MorningThe Gamble the Risk.......
Of greater concern is the US$7.9 billion sub prime exposure we have hedged with monoline insuror counterparties. This has an underlying value of about $2.9 billion and therefore, monoline insuror protection of $5 billion. Because of the now uncertain credit quality of these monoline insurors, we have taken a reserve of $2.8 billion of this amount, leaving exposure, or maximum future losses, of $5.1 billion. But this would occur only if the value of all the subprime exposure fell to zero, and all the monoline insurors went bankrupt.