explains that this is the “mega scandal of all mega
scandals”, because Libor is the “sun at the center of the
financial universe”, and manipulating Libor means that “the
whole Earth is built on quicksand.”
video to understand the largest banking corruption scandal in
history. These large banks have stolen money from every single
human on the planet. Not one person was left out. Not even YOU!
Now that it is exposed there is no going back. We will ALL
support the "NO MORE BAILOUT" mantra...
This one will not go away. It was not planned to go away like
other "banking scandals". This one will build and build and
build until it is known by every man, woman and child on the
planet. This is the exposure that will END the bad guys reign.
the Libor Scandal Affects You
By Jack Hough
July 06, 2012 "Smart
Money" - -A
liger is a cross between a lion and a tiger. Libor, on the other
hand, is a daily approximation of what banks charge each other
It turns out only one of these things is real. Awkwardly, it’s
not the one used to set prices on an estimated $800 trillion in
global financial instruments, or $116,000 worth for each person
on earth, ranging from complex derivatives to student loans.
That’s a problem for holders of bank stocks – which includes
just about anyone who owns a mutual fund or 401(k).
Barclays (BCS) agreed last week to pay $453 million to settle
allegations that it manipulated Libor, which stands for London
interbank offered rate. As The Wall Street Journal reported
Thursday, it’s likely only the first: More than a dozen banks on
three continents are under investigation.
Libor is compiled by asking 18 banks what they think they would
pay if they needed money. Some banks may have submitted
artificially low responses during the global financial crisis to
give the appearance of high creditworthiness. Others may have
tinkered with the reading to profit from trades, or avoid
The Barclays settlement is affordable, at less than 7% of the
company’s projected profits this year, but the size of legal
claims it and other banks face is difficult to imagine. Trial
lawyers will do their best to work out the sums, of course.
Libor may have been subject to rigging for more than five years.
In Thursday trading, Bank of America (BAC) lost 3% of its stock
market value, and JP Morgan (JPM), more than 4%. Investors are
worried about more than possible legal claims.
The financial crisis, with its bank failures and taxpayer
bailouts, led to regulatory attempts to rein in risky bank
activities, even at the expense of profits. JP Morgan is now
sorting through a massive trading loss–estimates range from $4
billion to $9 billion–that has raised calls for even stricter
Picture the public’s mood if the next round of losses stems, not
from rogue trading gone bad, but from widespread dishonesty that
pretty much had its desired effect.
Bank stocks already trade at a discount to offset some of their
warts. The banking sector of the Standard & Poor’s 500-stock
index sells for 12 times this year’s projected profit, versus 13
times for the broader index. The problem is that banks have
gotten so complex that relying on those estimates takes deep
Consider: Most analysts have trimmed their earnings estimates
for banks of late, not because of the Libor scandal, but rather,
because of weak investment banking trends. But on Thursday,
Wells Fargo analysts boosted estimates on several big banks.
Why? Because Moody’s slashed their credit ratings. See, lower
bond ratings mean lower bond prices, which in turn mean that
banks will record accounting gains for the hypothetical lower
cost of buying back their debt.
Financials, which make up 14% of the S&P 500, have had a good
year, all things considered. Before Thursday, ones in the S&P
500 were up 14% year-to-date, versus 9% for the broader index.
Investors should now consider reducing their exposure to these
stocks until more is known about possible liabilities connected
For central bankers, rate-rigging may be part of the mission.
For Wall Street bankers, it’s the clearest sign yet that the
industry isn’t well.
Bob Diamond rewarded for £100sBn fraud
The Artist Taxi
Driver On Libor
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