Yesterday, the market rebounded from down 300 to up 300 points on the strength of rumors of a bailout for bond insurance companies like MBIA Inc. (NYSE: MBI). But today's article in the New York Times suggests to me that there may be less there than meets the eye. That's because the report says that insurance regulators are trying to raise $15 billion from Citigroup (NYSE: C), Merrill Lynch (NYSE: MER) and Goldman Sachs Group (NYSE: GS).

Is anybody home? In case anyone forgot, Citigroup and Merrill bot announced huge losses and are scrambling to raise capital. Citi lost $1.99 a share and Merrill lost a cool $12.01. Fortunately, they've recently raised $18.7 billion and $12.8 billion respectively from Sovereign Wealth Funds (SWFs). But as a Citi investor, I don't want it turning around and investing that capital in yet another subprime-related house of cards.

The big problem for the bond insurers is to figure out how much capital they really need to insure against losses. MBIA has estimated that in the worst case, which it described as a one in 10,000 event, it expects to incur losses of $10 billion, a fraction of the $673 billion it has insured. Sean Egan, founder of Egan-Jones Ratings, thinks bond insurers may need to raise as much as $30 billion. It's not clear who's right.

Nor do I understand how these banks -- two of which have had to go begging SWFs for capital to shore up their own shaky balance sheets -- will be in a position to pony up $15 billion.

While Goldman may have the capital to invest, I am still amazed that the $2 trillion hedge fund industry continues to sit by the sidelines through this. What's scaring them away from this "opportunity"?

Peter Cohan is President of Peter S. Cohan & Associates. He also teaches management at Babson College and edits The Cohan Letter. He owns Citigroup stock and has no financial interest in the other securities mentioned.