by Odd Man Out
This from Naked Capitalism explains that bondholders were happy to do business with the Irish banks — the banks guaranteed that bondholders would get back 100 percent of their money, with interest, even if the Irish banks collapsed. That’s a hell of a way to run a casino.
But it’s even worse than that:
It is even worse than that….in Greece. Had Greece defaulted last week the ‘private’ (bond)holders of Greek debt would have gotten zero (0) of the $160 billion dollars owed to them. Instead those crafty Germans worked a credit default swap with Greece loaning them $170 billion dollars of European taxpayers money. That deal gave the almost bankrupted ‘private’ bondholders of Greek debt 54% of what they were owed by Greece in brand new government owned and taxpayer guaranteed bonds. At a rather generous interest rate. Using the rule of 7, the original bondholders should be made whole within 6 years. So who got screwed in this deal? The Greek people who are now completely owned, like slaves, by their fellow Europeans. The official unemployment rate in Greece today is 24.7%. Meaning that 50% of the Greeks don’t have jobs. Revolution anyone?