The argument for paying Anglo bond holders?

Trotter

I've heard a lot of convincing arguments this week as to why the insistence on paying upwards of 1 billion dollars to Anglo bondholders is tragic and misguided.

Can anyone tell me (a total newbie to these things) why the government has insisted on paying an unsecured bond? What are the reasons behind it?
Is there some subversive 'keep the boys at the top happy' reason behind it that little joe soap like me shouldn't know or understand? Or is paying this money the best thing for Ireland and its people in the long run?

I don't understand why we're even considering paying it. We're broke, and surely these bond holders are insured? It seems investing in Irish unguaranteed bonds is now risk free given the governments stance on having the poorest of the poor brought to the floor before entertaining the option of not paying on an unsecured bond to those that will never know what it's like to not afford bread.

Have I got this completely backwards?

ei.sdraob

There is no sane argument for it

The ECB made an offer "that can not be refused"

pay up or else...

Sudsy86

The ECB (from what I have read on here already) have not said Ireland Should pay back the Bondholders...

There are many arguements for and against paying the bondholder...

The government bailed out Anglo which changed the agreement...They (the government) agreed to pay the bondholder back...We (the ppl who elected the governement) have to adhere to the governments agreements...

There is no point in arguing over it, they WILL be paid back...

The reason behind it would need to be taken up with government officials, the liklehood of an answer are slim to none...

The bondholders did not Gamble the money, they lent the money to Anglo...From what I gather the Unsecured in unsecured bonds means that there is no security that they will make a profit on the bonds but that does not mean that they if the bank fails they wont get paid back what they originally paid in...

The above is my reasoning for why they are being paid back which for me helps me sleep at nite....It may be totally wrong and far from the thruth of the matter but zzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzz

Trotter

There's got to be a root reason for us not saying sorry we can't pay this; one that goes beyond 'we said we would'.

What or who is stopping the decision makers from saying no...

WalterMitty

This article by a public sector economist puts it in perspective i feel. We are getting things in return for paying them and will likely get more.
http://www.sbpost.ie/commentandanalysis/working-towards-a-better-deal-59317.html

Duke Leonal Felmet

ei.sdraob wrote: »

There is no sane argument for it

The ECB made an offer "that can not be refused"

pay up or else...

By right, the thread should have ended here.

two wheels good

"Irish Government ..... is on track to repay USD $1bn (€725m) unsecured unguaranteed senior Anglo bond on 2nd November 2011"

Quoted from Constantin Gurdgiev here:
http://trueeconomics.blogspot.com/2011/09/24092011-anglo-bonds-and-national.html

Trotter

The more I read on this, the more betrayed I feel.

Sand

Its quite simply fear. And greed.

Theres no sane reason why the unguaranteed debt of a dead, failed bank should be paid.

However, we have an insane ECB policy which would rather bankrupt sovereigns than allow market reality to apply. And our government is terrified of the ECB - its unclear why. As Greece has shown, the ECB can huff and puff, but the reality is they cant actually carry out any selective targeting of Ireland without causing vastly more damage to the Eurozone.

Secondly, we have greed. The insiders - our civil servants and politicians - are not paid by the Irish people. They are paid out of money lent to us. Were Ireland to not do what the ECB says, and risk ECB reprisals the money they are paid out of might not be lent to us. Or the ECB might retaliate through its role in the Troika by specifically requiring the removal of Croke Park and capping public sector wages and pensions at relatively low levels as a condition of further assistance. So its very much in the interests of our decision makers to go along with whatever the ECB says.

No matter how insane it is.

Scofflaw

We seem to have regular threads on this, and there are a handful of different explanations which tend to boil down into 3 main classes:

1. our politicians do it because they are mad corrupt and in bed with the bondholders

2. the ECB/EU makes us do it because European banks are really the bondholders and EU politicians are mad corrupt and in bed with the bondholders

3. it makes economic sense

There's an element of truth in all three, depending on what you classify as "in bed with the bondholders" and "corrupt". Our politicians, and the ECB, believe in the prevailing economic orthodoxy, and accept the power of the markets - as far as it's possible for politicians to accept anything unwelcome. So they look out for the interests of the bondholders because they believe that by doing so they're looking out for the interests of the Irish/eurozone economy, and in turn the interests of the Irish/eurozone public.

In the classic sense, then, it's not corrupt - that is, it's not being done for personal advantage. But it is being done because the system all revolves around money and keeping the money markets happy. Our politicians pay back unguaranteed and unsecured bondholders because they believe that doing so is better for Ireland in the long run, and the ECB want us to do so because they believe that doing so is better for the eurozone and to a much lesser extent Ireland in the long run.

Irish politicians would obviously like to reduce the amounts Ireland pays back but we're only willing to do so if it doesn't involve much damage to our reputation - and we can only really do that if we visibly have the sanction of the ECB to do it, rather than it being a unilateral decision on our part.

The Greeks have made it fairly clear that the ECB/EU/IMF will in fact not pull the plug if they can possibly avoid doing so, so it would seem that we should surely have similar leverage to insist on debt writedowns by being bolshy - the idea that the ECB will actually withdraw liquidity funding from our banks, or that the troika will withdraw funding from the state, is clearly not really on the cards. We're not doing what the Greeks are doing because we don't want to be seen to be bolshy - we want to be given a debt writedown that we can disclaim responsibility for - that we can claim we only took for the good of the eurozone, etc, we're not like Greece, and so on.

In other words, we want to have our cake (a reputation for paying our debts) and eat it too (not actually pay them). Currently the ECB will not let us actually eat the cake - which is, of course, outrageous.

cordially,
Scofflaw

ei.sdraob

4 Options

a. pay nothing
b. pay only a % (partial default)
c. pay only what was invested
d. pay what was invested + 13% interest


We are going with option d, some people think things are black and white (a or d)

I personally think its incredible that a risky double digit interest gamble ended up being goldplated due to actions of politicians, in a free market regime this crazy mess would not have happened but hey what would us Austrians know about anything

Scofflaw

ei.sdraob wrote: »

4 Options

a. pay nothing
b. pay only a % (partial default)
c. pay only what was invested
d. pay what was invested + 13% interest


We are going with option d, some people think things are black and white (a or d)

I personally think its incredible that a risky double digit interest gamble ended up being goldplated due to actions of politicians, in a free market regime this crazy mess would not have happened but hey what would us Austrians know about anything

An enduring question.

amused,
Scofflaw

moceri

Let me clarify Snr. Bondholders are not equivalent to Depositors. They charge a premium (13%) appropriate to the risk. Many of the bonds have been sold on at a discount. They should at least be cut to 50 Cent in the Euro.

Alan Dukes also bailed out AIB in 1985, when Minister for Finance. Looks like he has spent too much time amongst corrupt bankers who are just looking out for themselves.

We should have a Robin Hood Tax on Bankers to recoup this loss to taxpayers.

ed2hands

We're still paying for bailing out PMPA apparently..

Anyhow, can someone tell me what Dukes meant when he said that not paying tomorrow could trigger "cross-defaults"?

What exactly are the "serious implications" he talks about?

bobby3131

Better for Ireland in the long run !!!!!!! Wtf is the long run . My grandchildren will be paying for this through thier taxes for most of their working lives

Scofflaw

bobby3131 wrote: »

Better for Ireland in the long run !!!!!!! Wtf is the long run . My grandchildren will be paying for this through thier taxes for most of their working lives

We're currently still paying for debt acquired in the Seventies and Eighties, so there's nothing new there. And the national debt seemed vast and unpayable then too.

cordially,
Scofflaw

Bannasidhe

moceri wrote: »

Let me clarify Snr. Bondholders are not equivalent to Depositors. They charge a premium (13%) appropriate to the risk. Many of the bonds have been sold on at a discount. They should at least be cut to 50 Cent in the Euro. Jean Claude Trichet should stop protecting his Jewish Friends who are the most likely to be burnt.
The poison is endemic amongst this inner circle; each looking out for the other.

Alan Dukes also bailed out AIB in 1985, when Minister for Finance. Looks like he has spent too much time amongst corrupt bankers who are just looking out for themselves.

We should have a Robin Hood Tax on Bankers to recoup this loss to taxpayers.

WTF does religion have to do with this?

ianuss

Well, interestingly enough, possibly a fair bit.......http://www.guardian.co.uk/education/2011/oct/31/economics-religion-research

http://www.irishtimes.com/newspaper/frontpage/2011/1101/1224306845900.html

Scofflaw

ianuss wrote: »

Well, interestingly enough, possibly a fair bit.......http://www.guardian.co.uk/education/2011/oct/31/economics-religion-research

http://www.irishtimes.com/newspaper/frontpage/2011/1101/1224306845900.html

Possibly, but none of the countries involved are Jewish, which leaves the whole "Trichet's Jewish friends" thing a bit odd. Perhaps the poster would care to explain it?

moderately,
Scofflaw

flutered

ed2hands wrote: »

We're still paying for bailing out PMPA apparently..

now one can add quinn to the pmpa

ianuss

I wasn't making excuses for anti-Semitic comments btw, I just happened to read those articles today.

Good loser

Even if the ECB allowed us not to pay I think we should. It's a contract debt. In the longer run we will get cheaper rates on the bank and sovereign bonds by doing so.

We would be saving only the percentage of the haircut, 20% or 30%.

Remember how the Govt will/may help the mortgage holders - after separating the 'can't pays' from the 'won't pays'.

To the ECB and Germany, Finland etc we are in the 'won't pay' camp while Greece is quite obviously in the 'can't pay'.

Dirk Gently

Good loser wrote: »

To the ECB and Germany, Finland etc we are in the 'won't pay' camp while Greece is quite obviously in the 'can't pay'.

Greece can't pay because their citizens said they wont pay and frankly I applaud them for booting that proverbial can back up the road where it came from. Through sustained civil disobedience they've forced the bailout (debt) strategy to look itself in the mirror. Had Greek society accepted everything as Irish society has then I've no doubt Greece would still be viewed as being able to repay even though they clearly can't. It's time for the epic can journey to come to an end.

Personally I think Ireland is in the "we will pay even though we cant pay" camp. I view unsecured bondholders as being in the can take a hit but wont take a hit category.

Peppa

Interesting..

http://order-order.com/2010/10/15/anglo-irish-bondholders-should-take-the-lossesis-the-ecb-forcing-ireland-to-protect-german-investments/

Scofflaw

Peppa wrote: »

Interesting..

http://order-order.com/2010/10/15/anglo-irish-bondholders-should-take-the-lossesis-the-ecb-forcing-ireland-to-protect-german-investments/

No, rubbish - I draw your attention to the following exchange in the comments:

6
Deka Investment GmbH says:
October 15, 2010 at 7:37 pm

We’re on the list?

News to us.

12
Guido Fawkes says:
October 15, 2010 at 7:49 pm

You hold USD EQUIV 1.756 Million of the EURO MEDIUM-TERM NOTES 2004-25.6.14 FLOATER COUPON 1.689 TERM 06/25/2014

Do you want to know what day you bought it?
17
Deka Investment GmbH says:
October 15, 2010 at 7:55 pm

That’s a pretty **** coupon for junior debt.
26
Guido Fawkes says:
October 15, 2010 at 8:02 pm

You bought it.
35
The Gold's Under the Mattress says:
October 15, 2010 at 8:13 pm

Cheers Deka my old mate, I now know where NOT to go if I want any investment advice or financial services.
woops! says:
October 16, 2010 at 4:45 am

deka ****ing decked

"Junior debt"...this list is supposed to be Anglo's famous senior bondholders, the people they couldn't burn. But, oh dear, look, it contains junior bondholders, who did get burned, so it isn't a list of senior bondholders.

The debt coupon that brings Deka onto the list is subordinate debt which received an offer of 20 cent in the euro (see here) - not only that, it's exactly the same debt issue as was held by Wexford Credit Union:

WEXFORD CREDIT Union is unable to pay a dividend to its members this year because it has been forced to write down a €3 million investment in Anglo Irish Bank.

Manager Ultan Ryan said the credit union owned subordinated Anglo bonds worth €2.99 million, an investment which has now been written down by 80 per cent.

Source: http://www.irishtimes.com/newspaper/finance/2010/1209/1224285100497.html

Yet Wexford Credit Union isn't on that list, and Deka is. Why? Because Deka is foreign and Wexford Credit Union isn't - there's no other difference.

Not to put too fine a point on it, the list is a crock, sold to a gullible public in support of a political narrative.

cordially,
Scofflaw

Bannasidhe

Scofflaw wrote: »

No, rubbish - I draw your attention to the following exchange in the comments:



"Junior debt"...this list is supposed to be Anglo's famous senior bondholders, the people they couldn't burn. But, oh dear, look, it contains junior bondholders, who did get burned, so it isn't a list of senior bondholders.

The debt coupon that brings Deka onto the list is subordinate debt which received an offer of 20 cent in the euro (see here) - not only that, it's exactly the same debt issue as was held by Wexford Credit Union:



Source: http://www.irishtimes.com/newspaper/finance/2010/1209/1224285100497.html

Yet Wexford Credit Union isn't on that list, and Deka is. Why? Because Deka is foreign and Wexford Credit Union isn't - there's no other difference.

Not to put too fine a point on it, the list is a crock, sold to a gullible public in support of a political narrative.

cordially,
Scofflaw

Plus, even if an accurate list of those who originally purchased the bonds was available we have no idea who currently holds those bonds. The balance of probability is that some (if not all) were sold on when it became apparent that Anglo was imploding - and I seriously doubt that the original purchasers didn't take a haircut on the re-sale price.

So, and I must be clear this is conjecture as we simply do not have the information, the most likely situation is at least some of those we will be paying are speculators who purchased Anglo bonds at knock-down prices having gambled that the Irish state will honour them in full. A gamble that has paid off.

Now, while I do understand why the government is taking it's stance - and I think PR has a great deal to do with it plus I think there is some validity in their position- however, I also think as regards domestic politics it could backfire for them. Both FG and LP ran on a burn the bondholders platform - here is an opportunity to do just that with yes, some risk but I do not believe the risks are as great as are being touted.
FG/LP are so concerned with external perceptions of Ireland that they have taken their eye off the ball when it comes to internal perceptions. No matter how it is spun - the defeat of the 30th amendment was a disaster for the government, many voters perceived it as a power grab, plus Shatter and Howlin came across as arrogant in the extreme making government look out of touch with the national Zeitgeist.

If FG/LP want to play the PR card - I would suggest it would be more in their interests to refuse to pay the unguaranteed, unsecured bondholders and demonstrate to the Irish electorate that they are at least fulfilling some of their grandiose manifesto promises.

Scofflaw

Something that never seems to come up in these discussions, as well, is that debt is a legal contract. The government took on ownership of these institutions, and thereby acquired their debtors and creditors. So we are legally obliged to pay back the creditors.

Clearly, there are plenty of arguments for not paying them back (mostly, that we could do other things with the money), but we're not actually starting from a position where it's purely a matter of preference. If we force a writedown on the creditors, they can and will resort to law to obtain payment in full - and that's true whether the bonds have been traded on at less than face value or not, because the face value of the bond is the legal obligation acquired.

I'm not suggesting this is an argument that trumps all others - only that it's an argument that it seems doesn't even appear on a lot of people's radar.

cordially,
Scofflaw

ei.sdraob

ei.sdraob wrote: »

There is no sane argument for it

The ECB made an offer "that can not be refused"

pay up or else...

Just in case anyone has any doubts left about what is happening here it is straight from horses mouth

Mr Kenny said the repayment was on foot of a commitment entered into “at the highest level by the previous government and our external partners.”

it



aside: can people support my photoshop competition suggestion based on above

fred252

Scofflaw wrote: »

Something that never seems to come up in these discussions, as well, is that debt is a legal contract. The government took on ownership of these institutions, and thereby acquired their debtors and creditors. So we are legally obliged to pay back the creditors.

do unsecured bonds rank the same as deposits? i thought deposits ranked above unsecured bonds in case of bankruptcy?

there's been a lot of talk of reputation and keeping the money markets happy. what is the right thing to do in a moral sense, irrespective of the financial implications for ireland or the eu???

Scofflaw

fred252 wrote: »

do unsecured bonds rank the same as deposits? i thought deposits ranked above unsecured bonds in case of bankruptcy?

Senior bonds rank above deposits, whether secured or not - hence the 'senior'. The order can be reversed by government intervention, as it was in the case of Washington Mutual and Iceland, but such a reversal will always be challenged in court.

fred252 wrote: »

there's been a lot of talk of reputation and keeping the money markets happy. what is the right thing to do in a moral sense, irrespective of the financial implications for ireland or the eu???

...that depends on what you mean by moral. Is it moral to do what you're legally obliged to do?

cordially,
Scofflaw

fred252

Scofflaw wrote: »

Senior bonds rank above deposits, whether secured or not - hence the 'senior'. The order can be reversed by government intervention, as it was in the case of Washington Mutual and Iceland, but such a reversal will always be challenged in court.



...that depends on what you mean by moral. Is it moral to do what you're legally obliged to do?

cordially,
Scofflaw

i meant moral as in the fundamental principles of right conduct rather than legalities. the laws of the land can be changed.

meglome

bobby3131 wrote: »

Better for Ireland in the long run !!!!!!! Wtf is the long run . My grandchildren will be paying for this through thier taxes for most of their working lives

When for example someone takes out a mortgage they may not get all warm and fuzzy each month making the repayments but most will appreciate they entered into a contract to borrow the money and repay it with interest. If you don't pay you debts you become a much more risky person to loan money to. To the point you cannot borrow money or only at exorbitant interest.

I think many people (myself included) would have been happy to see Anglo and some of the smaller financial institutions go to the wall but our (three times in a row) elected government chose to nationalise them instead. That made their debts our debts. None of us like paying these debts but make no mistake they are now our debts. The Greeks may want to keep stamping their feet and pretending they didn't have anything to do with all that borrowed money but they clearly did, they borrowed it.

Of course if I had a time machine I'd be taking a different approach but I don't.

ei.sdraob

Well looks like someone released the full list of Anglo holders

Bannasidhe

Scofflaw wrote: »

Senior bonds rank above deposits, whether secured or not - hence the 'senior'. The order can be reversed by government intervention, as it was in the case of Washington Mutual and Iceland, but such a reversal will always be challenged in court.



...that depends on what you mean by moral. Is it moral to do what you're legally obliged to do?

cordially,
Scofflaw

We should also consider is it moral to run on a specific campaign platform and make promises, however ill considered or poorly thought out, to the electorate and then make no effort to fulfill those promises.
Sadly, as party manifestos are really what in the advertising industry are termed 'mere puff' and have no contractually binding status it is perfectly legal for political parties to promise any old crap and then make excuses as to why they can't carry out their promises. It's legal to lie to the electorate, but is it moral?

Perhaps we need a referendum to insert a clause into the Constitution which states that party manifestos form a social contract (or a Bill of Sale ) and failure to abide by them can result in impeachment of the government . It would certainly focus their minds...

ianuss

Bannasidhe wrote: »

Perhaps we need a referendum to insert a clause into the Constitution which states that party manifestos form a social contract (or a Bill of Sale ) and failure to abide by them can result in impeachment of the government . It would certainly focus their minds...

Now there's an idea.

dunphy3

Sand wrote: »

Its quite simply fear. And greed.

Theres no sane reason why the unguaranteed debt of a dead, failed bank should be paid.

However, we have an insane ECB policy which would rather bankrupt sovereigns than allow market reality to apply. And our government is terrified of the ECB - its unclear why. As Greece has shown, the ECB can huff and puff, but the reality is they cant actually carry out any selective targeting of Ireland without causing vastly more damage to the Eurozone.

Secondly, we have greed. The insiders - our civil servants and politicians - are not paid by the Irish people. They are paid out of money lent to us. Were Ireland to not do what the ECB says, and risk ECB reprisals the money they are paid out of might not be lent to us. Or the ECB might retaliate through its role in the Troika by specifically requiring the removal of Croke Park and capping public sector wages and pensions at relatively low levels as a condition of further assistance. So its very much in the interests of our decision makers to go along with whatever the ECB says.

No matter how insane it is.

just heard on radio [rte] that most garenteed bondholders have sold there bonds, new holders bought them for as little as 20cents in the euro,we are now paying them the foll whack?????? make sence.

Scofflaw

fred252 wrote: »

Is it moral to do what you're legally obliged to do?

i meant moral as in the fundamental principles of right conduct rather than legalities. the laws of the land can be changed.

That doesn't change the question, though. If you and I make a legal contract, is it moral for me to do what I legally agreed? Or, to put it another way, if I see that I can get out of doing what I've legally agreed, is it moral for me to do so?

cordially,
Scofflaw

Dirk Gently

Scofflaw wrote: »

That doesn't change the question, though. If you and I make a legal contract, is it moral for me to do what I legally agreed? Or, to put it another way, if I see that I can get out of doing what I've legally agreed, is it moral for me to do so?

cordially,
Scofflaw

If you paying what you owe could be better spent building a hospital which could save lives and provide additional treatment to people then yes I think morally you should build the hospital. If what a poster above said is true and the current bondholders paid 20cent in the euro for them is it morally acceptable for our government to pay out 5 times what they paid at the cost of the welfare of our citizens? As you said, a legal contract isn't a trump card and it's not simply a case of "getting out of it if we can".

fred252

Scofflaw wrote: »

That doesn't change the question, though. If you and I make a legal contract, is it moral for me to do what I legally agreed? Or, to put it another way, if I see that I can get out of doing what I've legally agreed, is it moral for me to do so?

cordially,
Scofflaw

People use too many analogies in economic dicsussions. That really should be dispensed with as much as possible.

If you were insolvent/bankrupt then yes, you should get out of doing what you agreed.

Anglo was insolvent as opposed to illiquid and the previous government made some mistakes. The question is would it be morally right for the current government to rectify some of those mistakes to some extent, irrespective of the financial implications for ireland and the eu?

Geuze

dunphy3 wrote: »

just heard on radio [rte] that most garenteed bondholders have sold there bonds, new holders bought them for as little as 20cents in the euro,we are now paying them the foll whack?????? make sence.

The particular senior Anglo bond repaid today traded as low as 52-55c.

See the price here:

http://www.boerse-frankfurt.de/EN/index.aspx?pageID=108&ISIN=XS0273602622

Geuze

Or see here for the price histrory:

http://www.boerse-frankfurt.de/EN/index.aspx?pageID=109&ISIN=XS0273602622

Lord Trollington

https://www.youtube.com/watch?v=5LTCT7QIeP8

Scofflaw

fred252 wrote: »

People use too many analogies in economic dicsussions. That really should be dispensed with as much as possible.

It's not an analogy, though - debt is a contract. I agree to give you money, you agree to pay it back.

fred252 wrote: »

If you were insolvent/bankrupt then yes, you should get out of doing what you agreed.

Anglo was insolvent as opposed to illiquid and the previous government made some mistakes. The question is would it be morally right for the current government to rectify some of those mistakes to some extent, irrespective of the financial implications for ireland and the eu?

The problem is that Anglo (and the others) haven't been declared insolvent - they continue to trade. So the legal resolution procedure in insolvency doesn't apply. The reason the government doesn't declare them insolvent is to avoid the consequences of doing so, such as asset firesales that would reduce the net value of the institutions.

Pretty much everything the government is doing - this one and the previous one - is aimed at deflating the bubble slowly and legally.

cordially,
Scofflaw

Scofflaw

If you paying what you owe could be better spent building a hospital which could save lives and provide additional treatment to people then yes I think morally you should build the hospital. If what a poster above said is true and the current bondholders paid 20cent in the euro for them is it morally acceptable for our government to pay out 5 times what they paid at the cost of the welfare of our citizens? As you said, a legal contract isn't a trump card and it's not simply a case of "getting out of it if we can".

No, the current holders certainly didn't pay 20c in the euro - as you can see from the price history Geuze linked to, the lowest on this bond has been 52c in the euro. Some of those who bought at that price may still be holding, but others who have bought more recently have paid up to 95c in the euro, so I don't think an argument based on what people paid is going to hold up.

As for the pre-eminence of building a hospital etc over paying back the bondholders, doesn't the same argument always apply? If I do some work for the government, can't the government say "well, Scofflaw, we'd sure love to pay you back in full, but we need to build more hospitals, so we're only going to pay you back a bit"?

cordially,
Scofflaw

fred252

Scofflaw wrote: »

It's not an analogy, though - debt is a contract. I agree to give you money, you agree to pay it back.



The problem is that Anglo (and the others) haven't been declared insolvent - they continue to trade. So the legal resolution procedure in insolvency doesn't apply. The reason the government doesn't declare them insolvent is to avoid the consequences of doing so, such as asset firesales that would reduce the net value of the institutions.

Pretty much everything the government is doing - this one and the previous one - is aimed at deflating the bubble slowly and legally.

cordially,
Scofflaw

not sure if you've answered the question but i guess you do think its morally right to repay this bond irrespective of the legality or fincancial implications to ireland and the eu.

Scofflaw

fred252 wrote: »

not sure if you've answered the question but i guess you do think its morally right to repay this bond irrespective of the legality or fincancial implications to ireland and the eu.

I think it's morally right to do what you've agreed to do, because you've agreed to do it. A little Protestant of me, of course, but there we go.

cordially,
Scofflaw

Sudsy86

Scofflaw wrote: »

That doesn't change the question, though. If you and I make a legal contract, is it moral for me to do what I legally agreed? Or, to put it another way, if I see that I can get out of doing what I've legally agreed, is it moral for me to do so?

cordially,
Scofflaw

Might be missing your point here but did you not say in another thread that if you paid a booky for a bet on a horse would you expect the booky to pay you back...I know ye're talking about Morals but this is Money(quite alot of money) when have morals every had any part in Money...

Im not arguing that we shouldn't pay them back....There paid back now anyway so there is no point...Im both for and against paying them back as I see both sides points now...

But........

Their was no guarantee with these bonds untill the government decided to take over the debts of the bank...To me this criminal...I feel as if the last government by making this decision have stolem from pretty much my bloodline for the next however many years...

There are plenty more bad decisions to be made and plenty more of my money to be stolen...Once the bills are paid, te shopping is done and i have enough for a brew at the end of the week for now im ok...

They take that away and i'm up for any planned uncivil action thats decided, Greece have paved the way...:mad:

Fantasia1

ei.sdraob wrote: »

There is no sane argument for it

The ECB made an offer "that can not be refused"

pay up or else...

exactly

Cubed

I keep hearing different opinions on this.. one commentator saying we have no legal obligation to pay up or are the ECB instructing us, others like on here say otherwise...

surely if they exchanged hands at 52% there face value then any basis for a legal claim to be paid in full must have been weak ?

Scofflaw

Cubed wrote: »

I keep hearing different opinions on this.. one commentator saying we have no legal obligation to pay up or are the ECB instructing us, others like on here say otherwise...

surely if they exchanged hands at 52% there face value then any basis for a legal claim to be paid in full must have been weak ?

No, because they most recently were changing hands at 95%.

As to a legal obligation - of course there's a legal obligation. Nobody loans you several billion without a legal obligation to pay it back!

amazed,
Scofflaw

Scofflaw

Sudsy86 wrote: »

Might be missing your point here but did you not say in another thread that if you paid a booky for a bet on a horse would you expect the booky to pay you back...I know ye're talking about Morals but this is Money(quite alot of money) when have morals every had any part in Money...

If you go into a bookies and ask for a losing bet back, the bookie will quite rightly laugh at you. If you loan the bookie money and ask for it back, he won't.

That's because one of those is a transaction in which you have no legal right to your money back, while the other is a legal transaction in which you certainly do.

Sudsy86 wrote: »

Im not arguing that we shouldn't pay them back....There paid back now anyway so there is no point...Im both for and against paying them back as I see both sides points now...

But........

Their was no guarantee with these bonds untill the government decided to take over the debts of the bank...To me this criminal...I feel as if the last government by making this decision have stolem from pretty much my bloodline for the next however many years...

There are plenty more bad decisions to be made and plenty more of my money to be stolen...Once the bills are paid, te shopping is done and i have enough for a brew at the end of the week for now im ok...

They take that away and i'm up for any planned uncivil action thats decided, Greece have paved the way...:mad:

Essentially, we took over the banks - or, rather the government did so on our behalf - and we haven't declared the banks bankrupt/insolvent, so the legal obligation to pay the debts of those companies is still there.

If we can find a decent legal excuse for getting out of them, great - but the problem is that we want the ECB to take the flak for it while we preserve our reputation as good debtors.

cordially,
Scofflaw