Tuesday, 21 June 2011

Letter to Mr. Trichet

TWITTER:    @ballyhea14
FACEBOOK PAGE:    Ballyhea bondholder bailout protest
June 20th 2011
BALLYHEA BONDHOLDER BAILOUT PROTEST – 17th march this Sunday, 10.30pm
LETTER TO Jean-Claude Trichet, President of the European Central Bank
Dear Mr. Trichet:
You are the President of the European Central Bank, our ECB, one of the most powerful men in the banking world, but I'm baffled – would you please tell me, exactly what part of ‘failed investment’ do you not understand?
I'm not a gambler of any description but I have been known to have the very odd punt in something like the Grand National; I put my money down in the full and certain knowledge that if my horse doesn’t come home I lose my investment.  I don’t play the stock-market but once, a long time ago, when Ireland’s then national phone company was being privatised, I bought my full allowable number of shares; didn’t know what to do with them once I’d bought them, held on to them through pure ignorance until such time as the company changed hands, lost a chunk of money I absolutely could not afford to lose.  But I accepted it - my own gamble, my own ignorance, my own loss.
In the last decade, various banks and finance houses in Europe and the US invested in Ireland, loaned billions to the Irish banks in return for bonds that were to yield them various margins of profit.  Those billions fed a bubble here which, when it burst, took down that Irish banking system, took down the government in passing, but which also decimated the Irish economy.
For our own excesses as a nation during that period, the deficit and national debt built up, we are paying a price.  Encouraged by our own government, by our own banks, many of our people invested in property, investments that failed – they are all now paying a price, we are all paying that price together.
In the normal course of events in the no-mercy cut-throat finance world, the bondholders would also have paid their price, would have taken their ‘haircut’ on their failed investment and moved on to the next target.  Would have, Mr. Trichet, but for your intervention, you and your battalions in the new all-conquering ECB Financial Empire.  You decreed that far from having to take the haircut that was then their due, those bondholders would have to be paid - in full and with all their built-in margins - by us, the Irish people.  We were already in debt, of course, so we’d have to borrow again to pay these multiple billions; to rub salt into our open sores, you also decreed that not alone would we pay the interest rate at which the ECB was getting those funds, we’d have to pay an additional penal 3%, so the ECB itself would also profit from this massive injustice.
I ask you again, Mr. Trichet – what part of ‘failed investment’ do you not understand?  Would you please justify what you did to me, what you have done to every man, woman and child in this nation?  I have heard people from within your bank tell us that this was our fault, that we have to take this medicine; I'm sorry, my friend, but I don’t think so.  I was going about my business, doing my own job as best I could – were you doing yours?
We’re told that Ireland’s regulator wasn’t doing his job properly, allowing the banks’ lending to become reckless in the extreme – who was regulating the lending to those same Irish banks?  Did you and your ECB not have a remit here?  Did those lenders, those bondholders, not themselves have a responsibility to ensure that those in whom they were investing their billions were worthy of the risk?  Even as this economy was starting to overheat, crying out for deflationary measures, for an increase in interest rates to make money more expensive, were you not actually decreasing those same interest rates?  Do you, your ECB, and your bondholders, not have any culpability here?
We put our hands up; we accept that successive governments - governments we elected - made a complete mess of our economy over the last decade; we accept that we can’t pay ourselves more than we earn as a nation so now we have to take the pain as we try to close the deficit in our finances and pay off our accumulated sovereign debt.  What we can’t accept is that, by your decree, we have to bail out those bondholders whose billions fuelled the flames that now engulf us, but who themselves aren't even singed by those same flames.  So, I ask for the final time – exactly what part of ‘failed investment’ do you, the top banker in Europe, not understand?
Yours sincerely,
Diarmuid O'Flynn.