Tuesday, July 10, 2012

Why is Nobody Freaking Out About the LIBOR Banking Scandal?

The banks gamed LIBOR for two semi-overlapping reasons. As noted here last week, there were instances of Barclays traders badgering the LIBOR submitters to “push down” rates in order to fatten their immediate bottom lines, depending on what they were trading or holding that day. They also apparently rigged LIBOR downward in order to produce a general appearance of better health, essentially tweaking their credit scores a few ticks upward.

At this rate, pretty soon will just be burying gold in their back yards. Probably be better off...