MBIA (MBI, news, chart, volatility) short-term out of the money puts are active. Shares are down 50 cents to $7.66 after Friedman Billings cut the price target on the stock to $9 a share after the company reported an operating loss of $2.22 a share yesterday. The firm remains cautious because of the tight credit and liquidity conditions. However, the firm says the company has so far managed the problems better than other bond insurers and it might also benefit from government’s TARP program. Players in the options market seem a bit more concerned, with 18,000 puts and active buying in the November puts with the 4 and 5 strike prices.