Ireland's Leading Party Wants New Bailout Terms

CNBC ^ | 2/21/2011 | Staff

[FromLori]

The leading party in Ireland's national election campaign wants to spread the pain from the nation's bank collapse to investors in bank bonds.

There has been much talk in the campaign leading up to Friday's national election about renegotiating the massive European Union/IMF bailout and of "burning" senior bondholders and subjecting their investments to sharp discounts.

There are widespread doubts whether Enda Kenny, leader of the opinion poll-leading Fine Gael party, can go further.

The European Commission is opposed, and investment ratings agencies have fired warning shots by further downgrading Irish bank bonds this month.

Kenny says he thinks it is "an obscenity" for taxpayers to always shoulder the burden of the bank collapse.

[FromLori]

That Debt belonged to the Banks but they Socialized the losses much like they did here with the bailouts only on a grander scale.

http://finance.yahoo.com/news/Why-the-Irish-Crisis-is-Going-usnews-4028366968.html?x=0

[agere_contra]

These debts indeed belong to the banks, not to the nation. The taxpayers should only be on the hook for sovereign debt.

Making taxpayers underwrite the private risk of private companies socializes losses and creates a massive moral hazard. So I approve of Enda’s game.

[FromLori]

I agree.