Madam, – Every time someone mentions the idea of “burning the bondholders” it is met by an angry response from the European Central Bank (ECB).
Perhaps the idea evokes images of mobs burning effigies of those they dislike or brings a reminder of the famous quote by Heinrich Heine: “Where they have burned books, they will end in burning human beings”.
Whatever the reason, it is clear that our language must change if we are going to make any progress on dealing with the excessive debt burden that is now on the shoulders of the Irish people. Might I suggest we start talking about “Segmenting the Bondholders” and dealing with them accordingly.
If there are bondholders who purchased bonds on the second- hand market at vastly discounted prices in the months leading up to the bank guarantee then at best they should be entitled to receive back only the money they actually invested. Why should a nation pay any more than this or allow private gambler to profiteer at a time when it is teetering on the brink of bankruptcy?
If there are those who climbed on the bondholders bandwagon at the peak of the market, it would seem unreasonable to treat them in the same way as the longer-term investors who may now be looking at huge losses in their pension funds. Some form of long term/short term segmentation is required if we are to move beyond the current impasse. – Yours, etc,
