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FED seeks LIBOR Alternative!
On September 4 2014 Federal Reserve governor Jerome Powell announced that the FED is looking for an alternative to LIBOR …any thoughts and ideas for a suitable replacement? The LIBOR (London InterBank Offered Rate) - initialized in 1986 as the ‘benchmark interest rate’ for futures contracts...
'Nobody Was Minding the Store'
We often joke about how incompetent the regulators are, and how if they actually knew what was going on they'd be working for a bank. Unfortunately, former regulator Guy Lawson confirms as much in his new book Octopus: Sam Israel, the Secret Market, and Wall Street's Wildest Con . He also confirms...
Joe Paterno, Wang Lijun, and LIBOR
What do a dead football coach, a Chinese bureaucrat, and an interest rate have in common? Standing up to call out something you see as wrong, even if it brings you down with it. Say what you will about Joe Paterno, but the bottom line is he took advantage of his personality cult to cover up the...
A Few Good Men: LIBOR Style
A Few Good Men: LIBOR Style via Dan Davies Deputy Governor, we live in a world that has interest rates . And those interest rates have to be set as the average of a panel of banks... Who's gonna do it. You? You, Deputy Governor? I have a greater responsibility than you can possibly fathom. You weep...
A $350 Trillion problem
Looks like the BBA is ready to relinquish its LIBOR setting responsibilities . This opens up an interesting discussion about what might replace it and who will be responsible for overseeing LIBOR. Will the UK government regulate it? Will they follow the European example with how EURIBOR is set?
How did LIBOR scandal affect billions of people?
I'm thinking more in the millions. a) LIBOR is not the only benchmark b) plenty of student loans, mortgages, etc are fixed rate or not based on LIBOR c) most people's pension/retirement money is invested in stocks and bonds. The rates that can really play around with bond prices are driven by the...
My Solution for the LIBOR Scandal
The saddest part about the Libor scandal is that I'm not surprised. The New York Times published a graphic on July 10--"Behind the Libor Scandal"-- that explains exactly what happened during the past seven years and why. It explains how Libor, the London InterBank Offered Rate, is calculated. And it...
Why the hell would a LIBOR submitter want to commit fraud for a trader to make the trader money? How much did the submitters get
Some of the most popularized quotes in the Barcap LIBOR scandal were: Hi Guys, We got a big position in 3m LIBOR for the next 3 days. Can we please keep the lib or fixing at 5.39 for the next few days. It would really help. We do not want it to fix any higher than that. Tks a lot. and For Monday we...
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