Voluntary is the key "v-word" now

President Trichet last week stressed again the ECB’s general opposition to a restructuring of Greek debt. But he left the door slightly open to a “voluntary” agreement in which bondholders would commit to exchange maturing or soon-to-mature Greek bonds for new longer-dated bonds. With Germany insisting that a new aid package includes some form of private sector participation, and the IMF threatening to withhold the next tranche of Greece’s first bail-out until a deal is struck, quite how the term voluntary is defined could now be the pivotal issue in the crisis.