London’s Liberated LIBOR Leaps Across The Atlantic

LIBORLeaping lizards! LIBOR has been kidnapped! Well, taken away at least. The London Interbank Offered Rate (LIBOR) reports the interest rate banks are charging each other in well, London. London is a historic financial center for Europe, sort of like New York is for North America. Who cares? Few I suppose, but that’s ignorance; a large chunk of the world’s business and lending reflects LIBOR interest rates, especially all over Europe. When borrowers seek money, LIBOR is a large factor in what they will have to pay for it.

That is why the LIBOR scandal was a big (if little reported) deal. Some of those London banks were caught with their fingers in the cookie jar; they were colluding on fixing LIBOR to benefit themselves. Assume, if you’re American, that the Fed was putting out fake interest rates upon which depended your retirement. You get the idea. You may read more here.

Various of the guilty have been nailed, as the linked report testifies. You may suppose as I do if you wish, that some more important folk have been, ah, ‘overlooked’ in the investigation. Or not, as pleases you.

But the latest is right off the wall: The mandatory after-the-fact- investigator evidently pointed out that having folks with an interest in setting rates, set the rates, was asking for corruption. What a discovery that is! You’d have to think that bankers weren’t more ethical and noble than the rest of us to think such a thing, right? But that appears to be the shtick here. And the mighty, recognizing what that was, handle toward their collective hand, have grasped the opportunity and struck with it in one fell swoop or swell foop or however it goes.

They have expatriated the ‘London Interbank Offered Rate’ to…New York! Not trusting British banks to honestly report actual market rates after the scandal, the mighty have decided to trust the New York Stock Exchange,  instead. I will let the Brits express what they think of that, it seems their right and you may read this.  Summing it up, the Brits think sending LIBOR to New York is putting the fox in charge of the chicken shed. Wall Street will no doubt, approve as the LIBOR interest rate underlies so much of the costs of borrowing around the world. The world’s hapless borrowers have been handed from a big thief to a larger one if the cited article has it right; I don’t know that, but it sure fits history. We will see. No doubt that the gold bugs are happy; they thrive on watching the world self-destruct…

You heard it here, if nowhere else. Remember this famous dictum: “The difference between a politician and a banker is, a politician lies in public.”

About Jack Curtis

Suspicious of government, doubtful of economics, fond of figure skating (but the off-ice part, not so much)
This entry was posted in Banks, Conspiracy, Corruption, Debt, Economics, Fiscal/Financial Responsibility, Investing, Scandal and tagged , , , , . Bookmark the permalink.

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