Strike prices of $14 and $18 in particular showing some volume.

I don't know yet what the story is behind this activity. There's similar activity for MBI (MBIA) as well, but on a lesser scale.

(I just went long AGO stock.)

Possible hedge against Greece giving the EU the finger in 2 weeks?

Some kind of "new" mortgage settlement for bond insurers??

I'm still looking around.

As far as I can tell, Assured Guaranty does have suits pending against UBS and JPM:

Assured Guaranty Municipal Corp. v. UBS Real Estate Securities Inc., 650327/2012, New York State Supreme Court, Manhattan

Assured Guaranty Corp. v. EMC Mortgage LLC, 650805/2012, New York State Supreme Court, Manhattan

But aren't the chances remote that any realistic sort of settlement, or verdict in AGO's favor, would pop the stock to such an extent?

So, if these calls are a straight long play, my first guess is that they're front-running some sort of legislation.

I hadn't realized it, but the issue of covered bonds has received a lot of attention in recent months:

S&P is going to put the ratings hurt on lots of covered bonds, effective July 12:

http://www.reuters.com/article/2012/05/3....

Then there's the United States Covered Bond Act of 2011:

http://www.corker.senate.gov/public/inde....

http://thomas.loc.gov/cgi-bin/query/z?c1....

Are Hagan and Corker the cavalry? This sounds sexy:

http://www.mortageservicerattorney.com/7....

Partial quote:

Quote:

The Hagan-Corker bill would create a regulatory and oversight framework for U.S. covered bonds and clarifies the rights of investors should an issuer become insolvent . . . it would change who could issue covered bonds and moves nonbanks to the Federal Reserve’s jurisdiction.

http://www.opencongress.org/bill/112-s18....

Partial quote:

Quote:

[The Bill s]ets forth requirements for . . . obligations of issuer and its conservator, receiver, liquidating agent, and trusteeship of the estate in bankruptcy by the covered bond regulator. Directs the Comptroller General to study whether federal reserve banks should be authorized to extend credit to an estate of a covered bond in bankruptcy.

Anyway, I'm not drawing any conclusions in respects to the intent behind those calls.

Good work Argos, thanks.