Agencies Whistle Past the SCA Graveyard By Jim Cramer About this article: No one can blame anyone for being confused about financial guarantees. Consider the case of Security Capital . Here's an organization that has tremendous insider buying and the full support of the regulatory agencies for being well-capitalized, even as the CDOs it insures and the residential mortgages it backstops would have to be among the highest risk imaginable. It is hard to imagine a more toxic brew than what SCA has on its hand, save E*Trade. The company has minimal reserves set up for about $105 billion in guaranty risk, including about $8.9 billion in residential junk -- which is, of course, highly rated (talking about home equity loans and subprime loans) -- and it has reserves of $81 million. That's just a catastrophe waiting to happen. Yet you probably have not heard one word about them. How can this be? Because who's going to enforce it?... Or, call us at 1-866-321-TSCM (8726) Monday-Friday, 8 a.m.-6 p.m. ET. Outside the U.S. and in Canada, call 1-212-321-5200.

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