S&P confirms FANT.W at AAA

Yes, S&P's fantasy world where the bond insurers are AAA is developing nicely. Bloomberg reports:

MBIA Inc., battling to stave off the crippling loss of its AAA credit rating, soared in New York Stock Exchange trading after Standard & Poor's said no downgrade of the bond insurer is imminent.

The insurer remains on negative outlook, meaning that any ratings move may be lower, though not any time soon, New York- based S&P said today in a statement. Ambac Financial Group Inc., which ranks second to MBIA among bond insurers, is still being reviewed for a possible downgrade pending the company's ability to raise new capital, S&P said.

This must be so frustrating for Bill Ackman. He's basically right, but the world keeps on being irrational. And this, of course, takes the pressure off Moody's to do anything about MBIA either.