Hedge funds move in for the kill at our expense

WE face a seismic choice as to whether we allow private or public equity to refinance our (and I stress our) banks.

It is my understanding, and I may be wrong, that the hedge funds now circling the carcases of our banking institutions were largely responsible for the start of the present crisis.

Our ministers are now proposing that these same interests be allowed, and indeed encouraged, to buy up vast tracts of shares in our banks at knockdown prices guaranteed by us. This smells of eircom all over again.

These hedge funds will asset-strip the entire country and move on — they will not push lending to the businesses that are screaming for it now. The National Pension Reserve Fund could be used to recapitalise the banks. We would retain control of our own destiny and by 2025, when we need the fund, it will almost certainly be worth a big multiple of its present value. This raises two issues:

1. This Government is still being run for the benefit of private enterprise, or

2. Neither Mr Cowen nor Mr Lenihan has the vaguest idea how to get us out of this mess.

Miles Cattell

Slieverue

Riverstick

Co Cork