Fianna Fáil Finance Spokesperson Michael McGrath TD has criticised the Government’s flip flop on paying the Anglo Irish $1Billion bond today, highlighting the massive payday that it has allowed bond market speculators.
He commented, “Today Fine Gael and the Labour Party have formally abandoned one of their most important election promises. By writing the $1 Billion cheque to pay off unsecured unguaranteed bondholders in Anglo Irish Bank, they have betrayed voters and exposed the cynicism at the heart of their election campaigns and their time in Opposition.
“What will be even more galling for voters is the fact that the flip flopping of the last eight months by Fine Gael and Labour has delivered a bonus for bond market fat cats potentially running into hundreds of millions of Euro.
“A quick look at the prices that this Anglo bond has been trading at over the last year demonstrates the point. The price dropped from 70-75 cent in the euro in December 2010 and January 2011 to a low of 52 cent on 14th February 2011. It is clear that the rhetoric from Fine Gael and Labour during the General Election campaign, promising to burn these bondholders, drove down the price.
“Investors who bought these bonds at this time will have doubled their money in just 9 months! The new Government can hardly complain about speculators making money from these bonds, since it was their empty promises that drove down the price in the first place, and their betrayal of voters that delivered the 100 cent in the euro return.”