The latest banking scandal involving the ‘fiddling’ of rates that the banks lend to each other is now exposed, it will dominate political news for weeks and will ultimately see many heads roll. The question that remains unanswered is how many banks are implicated. I guess time will tell.
The interesting thing about the resignation of the Barclays Chief Executive, is that he has a clear incentive to implicate as many people as possible when grilled by MP’s to dilute his own shortcomings. What is unclear is whether he knew what was happening or not. Either way, he had to go.
The bigger issue is the role of the Bank of England in all of this. It is being intimated by Barclays that, not only did the Bank of England know of the illegal ‘Libor fiddling’, but they were actually encouraging it.
I completely understand that the Bank of England are useless and not fit for purpose……giving an ideal excuse to Mervyn King in not identifying that this was going on. But encouraging it? Well, this would bring things to an all time low. Government heads would then roll……which might not be a bad thing.
Perhaps, the biggest issue is that nobody is shocked or surprised by all that has gone on. That is the biggest and saddest outcome from all of this.
Shameful.
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