UPDATE — Leo Varadkar versus the World (7): Irish Central, Vanity Fair, etc. – Establishment created Ponzi Scheme and froze out those who warned against it


Double-plus good, citizens!

MUST READ — Michael Lewis’s report on Ireland in Vanity Fair — via Irish Central’s Niall O’Dowd, who reports in The real heroes and villians of Irish crash finally revealed in ‘Vanity Fair’ masterpiece:

The bondholders who the Irish people are now in hock to for $100 billion or so, didn’t expect they would get repaid when the banking system collapsed.

The best they were hoping for was about 20 cents in the dollar…

Social Justice Ireland reports – :

According to Vanity Fair “Lewis interviewed (Minister for Finance, Brian) Lenihan in an attempt to uncover the man’s reasoning for his actions. Lenihan asserted that he had no choice in the matter. “Under English law,” he explained to Lewis, “bondholders enjoy the same status as ordinary depositors.”
As Lewis points out, this is legalistic – “narrowly true, but generally false. The Irish government always had the power to impose losses on even the senior bondholders, if it wanted to.”  When he made the decision in 2008, Minister Lenihan said it was done to prevent contagion. But Lewis points out, this wasn’t true either. A year and a half later, the Minister offered a different explanation, claiming that the bonds were owned by Irish people and institutions. “The Irish, in other words,” Lewis writes, “were simply saving the Irish. This wasn’t true.” The bondholders were mostly foreigners…

The Vanity Fair investigation into Ireland’s predicament – When Irish Eyes Are Crying:

“Lenihan faced a choice: Should he believe the people immediately around him or the financial markets? Should he trust the family or the experts? He stuck with the family. Ireland gave its promise. And the promise sank Ireland…”

“The investors who owned the roughly 80 billion euros of Irish bank bonds,….were stuck. They couldn’t take their money out of the bank. And their 80 billion euros very nearly exactly covered the eventual losses inside the Irish banks.

These private bondholders didn’t have any right to be made whole by the Irish government. The bondholders didn’t even expect to be made whole by the Irish government.

Please, read more.

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This entry was posted in Accountability, Bankers' Bailout, Budget, Debt Default/Restructuring, ECB/IMF, Economy, Elections, EU, Housing Bubble, Ideology, ireland, Irish America, Local News and tagged , , , , . Bookmark the permalink.

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