[JohnFen]

> they are destroying the principle of every existing bond on the market

What principle are they destroying? Bonds are not, and never were, immune to economic changes. They're just less volatile and react differently than stocks and, if you hold them to maturity, will pay what what they promised.

It seems to me that the problem is that a whole bunch of people made investments assuming that there was effectively no risk in doing so. Like the good times would last forever or something.

[candiodari]

These bonds are not held as investments, but as collateral for getting other things (like money to buy mortgages with).

If your collateral gets worse ...

[JohnFen]

Either way, they were treating them as if their value was guaranteed prior to maturity. That has never been a thing that these instruments guaranteed. They were gambling, because they failed to hedge that risk.