Thursday, 2 June 2011

Guest post by Arthur Doohan: The burning of the bondholders

Arthur Doohan: There is something of a scramble to jump onto the bandwagon of those seeking to attend the 'burning of the bondholders'.

What could possibly have prompted the rush to this 'auto-da-fé'?

Could it be that the institutions are afraid that the recently enacted powers under which these orders hope be enforced might be struck down in the High Court challenge brought by Messrs Abadi and Aurelius, due to be heard next week?

It could be that the banks want to make sure the schemes have some chance being allowed to stand by reason of being extant before the ruling in the event of the ruling going against the State.

That would indicate a severe lack of confidence on the part of 'our learned friends' in the strength of the primary legislation with respect to other laws and precedents.

But it could just be that the market trends and ever rising bond-yields mean that they hope the bondholders are entirely ready to throw in the towel.

Either way, an awful lot is riding on next weeks hearing.

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