I fear the thread's title is a little misleading, it should read: "Both cleared to the hold at the same level".
As captainsmiffy illustrates, a/c were not in the hold yet (was it not DESDI btw, a common DESDI hold level, not BUBIN?), and until a/c have entered the hold, radar separation can be applied, what was done is perfectly legal, and possibly the only option (at the time) at the ATCO's disposal.
I agree that should both a/c have gone 7600 or should ATC have lost radio's, a loud bang may have resulted, but in this airspace, as in most these days, if one were to control without an element of experience/trust/faith/self belief, then air traffic would come to a grinding halt.
'69