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Bond Holders and the Bailout - David Norris in Indo

Comments

  • Closed Accounts Posts: 18,163 ✭✭✭✭Liam Byrne


    Precisely.

    You'd expect that approach from a scummy moneylender, but not from a supposed "bank". But Anglo proved that some banks operate just as badly, if not worse, than moneylenders.

    This is why the "debt-for-equity" swap was proposed, so that they would be getting an interest in running a business properly, rather than simply looking at it was a way to make "interest on interest", which is what FF & The Greens - and now the EU - allowed them to do by taking over the banks' debts; they probably have no chance of getting the original money back directly, so they'll charge crippling interest in order to get as much of it as they can back that way.

    Think of it as someone who wants to make a massive profit selling 5 cars, rather than a reasonable sustainable business selling 5,000 cars at reasonable prices; no long-term view as long as they get their massive cut.


  • Registered Users, Registered Users 2 Posts: 43,313 ✭✭✭✭K-9


    Liam Byrne wrote: »
    Precisely.

    You'd expect that approach from a scummy moneylender, but not from a supposed "bank". But Anglo proved that some banks operate just as badly, if not worse, than moneylenders.

    This is why the "debt-for-equity" swap was proposed, so that they would be getting an interest in running a business properly, rather than simply looking at it was a way to make "interest on interest", which is what FF & The Greens - and now the EU - allowed them to do by taking over the banks' debts; they probably have no chance of getting the original money back directly, so they'll charge crippling interest in order to get as much of it as they can back that way.

    Think of it as someone who wants to make a massive profit selling 5 cars, rather than a reasonable sustainable business selling 5,000 cars at reasonable prices; no long-term view as long as they get their massive cut.

    Why would anybody have taken debt for equity in Anglo?

    Mad Men's Don Draper : What you call love was invented by guys like me, to sell nylons.



  • Closed Accounts Posts: 18,163 ✭✭✭✭Liam Byrne


    K-9 wrote: »
    Why would anybody have taken debt for equity in Anglo?

    Well, we did, courtesy of the Failure party.

    If they'd invested in a completely unsustainable business that failed, then they should have been like any other investor/credit......put the business into liquidation and take what they can get, or else take a risk and invest some more.


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