Torino Group: Bondholder Haircuts Should Worry Us All.

(12PressRelease.com) Torino Group - If bondholders are forced to shoulder losses, taxpayers will still be on the hook.

“Torino Group” analysts say that Irish, Greek and other EU taxpayers angry over the bailout culture and calling for senior bondholders to be forced to take “haircuts” on their holdings of sovereign and bank debt should be better informed of the consequences of such a development.

A senior strategist at the investment firm said, “Many of these bondholders are insurers and pension funds and, if they were to suffer losses on these sovereign or bank bonds, there would be a significant knock-on effect on their ability to pay benefits to retirees who may have spent years paying into pension schemes.”

The issue of bondholder haircuts has recently made headlines because of suggestions by German and French leaders that investors should be made to share some of the burden associated with mounting rescues for Greece and Ireland and, perhaps, Spain and Portugal in the future.

The “Torino Group” strategist added, “If, as a result of taking haircuts, those pension funds and insurers subsequently need bailing out, it will still be the taxpayer who gets lumped with the liability.”

“Torino Group” advises its individual clients planning for retirement to ensure that part of their pension fund is invested in assets that have minimal or no counter-party risk. “Assets like physical gold and silver do not depend on anyone else‘s ability to pay and, in this environment where banks and other financial institutions are so inter-connected, that‘s a major plus,” concluded the strategist.