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HomeAn Irish Chink in the Euro’s Armor?
Posted by Larry Doyle on March 29th, 2011 6:03 AM |
In the midst of my recent travels around Ireland I was asked the following question by an Irish businessman. “Larry, when investors purchase senior bonds issued by banks, don’t they take risk?” I informed this friendly chap that based on how capitalism is supposed to work, that yes, these senior bondholders just like every other investor supposedly take risk when making an investment of this type.
My new friend then inquired as to how and why in Ireland’s recent negotiations with the EU’s hierarchy that the senior bondholders of Irish banks were not compelled to take a haircut. Knowing that we did not have enough time to fully pursue all of the angles to this topic, I gained an up close and personal appreciation for the disgust that many Irish citizens have for the recent ‘supposed support’ Ireland received by the EU and the European Central Bank. Read the rest »
Having spent the better part of the last two weeks in Europe, I have gained an even greater perspective for the need to address our massive fiscal deficit here at home. While selected analysts would discount the global impact of the debt strapped peripheral nations of Europe, we do so at our peril. Why so? Have you looked at some of the European peripheral bond markets lately? 
Did the Wall Street regulator FINRA have funds from its own internal investment portfolio invested directly or indirectly in Bernie Madoff’s Ponzi scheme? Did FINRA effectively front run the auction-rate securities market in 2007 when it liquidated a position of approximately $647 million ARS from that same internal portfolio?
