July 05, 2012
Banks Are As Criminal As Advertised
One wonders why anyone would be astonished that Barclay and other banks fix the game to their advantage by fixing key interest rates. This has been obvious for a long time. The banks do this with the knowledge of every politician and regulator involved. They even publicly advertise it.
What might help against such overt and greedy market manipulation? Simple: put the management of any bank that breaks the rules into jail. For a long time. And throw away the keys.
The public should not work for the banks' interest but banks should work for the public interest. If they can not do that under private ownership, seize them and run them as public property.
Posted by b on July 5, 2012 at 07:12 AM | Permalink
Damn straight b!
Posted by: Alexander | Jul 5, 2012 7:20:54 AM | 1
If we'd lock-up the criminals the world would be a much nicer place. Thanks for the post!
Posted by: DaveS | Jul 5, 2012 7:53:06 AM | 2
>>> Simple: put the management of any bank that breaks the rules into jail. For a long time. And throw away the keys.>>>
and while you're at it, start spinning your own cotton and drying your own salts.
Posted by: www | Jul 5, 2012 8:41:46 AM | 4
don't forget that prisons are Very costly... Force them into the army, and send them to Afghanistan (then their "goal oriented" policies might make sense...
no the real thing is to make laws to limit their activity, and make the oversight better by offering rewards to anyone who can spot corruption... (let the criminal elements fight/frame themselves)
the next step would be making the banks unable to print money, moving that to the Governments, this would stop the need of EVER the needing Fiscal policies being implemented in Europe at the moment...
Posted by: simon | Jul 5, 2012 8:57:04 AM | 5
Why allow banks this interest setting privilege at all?
Posted by: Eureka Springs | Jul 5, 2012 9:49:23 AM | 6
At the risk of being the Jacobin of the thread I'm closer to Simon's way of thinking.
Most of these bankers are not common criminals. They are traitors. Seeking to bankrupt the state in which you are a citizen in order to make an extra few million, is treason against the state and has always being punishable by death. Attacking the general public of a country in which you claim to be a member is treason, and working with foreign interests (in this case Banking Cartels) to the detriment of your people is also treason.
One of the leaders of the French Revolution, Robespierre, said it best in his first speech to the National Assembly, when he called for the execution of the King.
"The King must die so the Country can Live".
I advocate the same path for the bankers. Greed is a drug. They will not just stop stealing because they have enough. It is always more and more with them and it won't end until the people are impoverished and they are Emperors.
Posted by: Colm O' Toole | Jul 5, 2012 9:55:50 AM | 7
And the band played on.....
Five years after Wall Street started melting down; key regulations to prevent another financial crisis are being delayed or scrapped altogether. More than one-third of all the new regulation created by the Dodd-Frank Wall Street reform law of 2010 have yet to even be written. On top of that, the Securities and Exchange Commission has missed the implementation deadlines on 71% of its new rules. One reason why new regulations are being delayed is that Republicans in the House have slashed funding for critical Wall Street watchdogs – and are threatening to defund the Dodd-Frank reform law altogether – giving banksters a chance to turn Wall Street into a casino again.
Posted by: ben | Jul 5, 2012 10:02:43 AM | 8
Please define "...the public interest." I'm clueless. Highland Clearances or Enclosure
In socially violent society with history of extreme (physical) violence, and adhere to, and live by the creed "...there is no such thing as society" and "supply side economics" what would that be?
Posted by: neretva'43 | Jul 5, 2012 10:34:45 AM | 10
In Venezuela, the bankers who engaged in fraudulent shenanigans are in prison or in their way there. The ones who where not caught "escaped" to where? The United States of America.I'm convinced already that the US is nothing more than a mobster-like entity where criminality not only "happens"; IT IS encouraged.
Posted by: jose | Jul 5, 2012 10:54:29 AM | 11
In fact, there are 9.8 million people living in rural England (defined as settlements with fewer than 10,000 inhabitants). Of these, 140,000 people are full-time farmers, or the business partners, directors and spouses of full-time farmers. In other words, they constitute 1.4% of the rural population (and 0.3% of the total population).
Yet rural policy seems to be tailored largely to their needs. It’s not enough that (in the UK as a whole), taxpayers give farmers and landowners – among whom are the wealthiest people in Britain – £3.6 billion a year in the form of agricultural subsidies. Under this government the landowners must also be permitted to decide how and for whom the countryside is run. Ninety-nine per cent of rural people – and 99.7% of the nation as a whole – are marginalised from decision-making in the countryside.
Try with Class Warfare.
Even, Buffet admit that but you won't see that one from Martin Wolf and large body of journalist-presstitutes, who are besides making comfortable living, primary task is to bamboozle population with "noise". In the audio industry there is parameter called Signal to Noise ratio, the lower the noise the better. In government's media outlets the more noise, the better.
Posted by: neretva'43 | Jul 5, 2012 11:00:49 AM | 12
Yes, I had for a few years a mortgage. Took it out in late 2000s. Looked about for the cheapest but my pension fund (lends at very low rates) would not accept me, because I was a single mother. Stuff them.
One condition I had was to be able to pay it back in toto whenever I wanted. This proved disagreeable to the banksters - quelle surprise.
At the third bank I consulted, a bright wag suggested a mortgage pinned to LIBOR. There was a 6 month to quit (pay off) clause, I insisted it be brought down to 3, he agreed. So I suppose...the bank ate the 3 months interest due when I paid it off in 2010. Or something. I don’t know.
I paid interest between 1 and 2.5 % - as the mortgage was small, what I paid was little - and I pretty much ignored the interest rate. I asked the bank, could it not rise abruptly, and how come it is so low all the time?
Oh, I was told, its the rate that banks lend to each other, it can vary, but it won’t go up, as they prefer it to be low. They could fix it higher but then they’d be paying masses to each other all the time, low is better. (This makes no mathematical sense, but whatever.) OK I said, I’m paying it back soon anyway. What? Your payments are fully tax deductible, do you realise that?
Only in CH, I guess. I am not rich, etc., and have no contacts.
The point is, the free market does not exist, all prices are fixed or heavily influenced by those who have the power to do it. The free market is a myth for dupes. Interest rates are fixed by conglomerates, monopolies, the stroke of powerful pens, lying financiers, 7 minute meetings, the big boss laying down the word, etc. Scammers have space to go for temp. big profits. The whole ‘finance’ industry is a lying BS to catch the ordinary punter, the hapless trusting consumer, and, finally, the State to pay off, bail out, the money men.
Posted by: Noirette | Jul 5, 2012 11:19:20 AM | 13
This furore about LIBOR will die down. Soon.
Very few ppl understand what it is about anyway. (Includes me.)
A few heads will roll.
Diamond quits, well ho-hum, he will spring up elsewhere after spending time with his family. Or will sashay sideways into golden retirement... Revolving doors set up to accommodate the supposed victims into new positions of power and regulatory authority!
The scapegoats offered to the public for short term media lynching bitch and threaten like mad, they don’t appreciate the lottery of the sacrifice - stunned, then pissed off, plus the wives have serious threats in their designer bags -ouch-, so arrangements are found.
Feathers are smoothed. To lustrous gleam.
All in a good cause, old chap, and I’m on your side, Carry on!
Posted by: Noirette | Jul 5, 2012 12:45:00 PM | 14
The big banks are just agents manipulating the market on behalf of the bank of england
Posted by: nikon | Jul 5, 2012 12:46:31 PM | 15
But the true heart of the manipulation is the London Bullion Market Association, overseen by the Bank of England, in which $30 billion dollar worth of gold flows through everyday, $10.9 trillion dollar worth of gold every year
Literally at the crack of London dawn on January 30, 1997, the London Financial Times printed the following:
Deals involving about 30 million troy ounces, or 930 tonnes, of gold valued at more than $10 billion are cleared every working day in London, the international settlement centre for gold bullion.
This is the first authoritative indication of the size of the global gold market, and was revealed yesterday by the London Bullion Market Association.
With the blessing of the Bank of England, the association overturned years of tradition and secrecy to provide statistics illustrating the size and depth of the London market.
The volume of gold cleared every day in London represented nearly twice the production from South African mines in a year, Mr. Alan Baker, chairman of the association, pointed out.
It was also equivalent to the amount of gold held in the reserves of European Union central banks.
The size of the gold market will surprise many observers, but traders insisted the association's statistics were only part of the picture because matched orders are cleared without appearing in the statistics. Mr. Jeffrey Rhodes, of Standard Bank, London, said the 30m ounces should be "multiplied by three, and possibly five, to give the full scope of the global market".
Posted by: nikon | Jul 5, 2012 1:04:42 PM | 16
Noriette @ 13-14: YEP! Absolutely. At least here in the US. I would hope the outcome might differ in other parts of the globe.
Posted by: ben | Jul 5, 2012 1:06:23 PM | 17
now now, b. I know you are a German nationalist, first, and a Stalinist, second; but Deutsche Bank is in the middle of all this shit too.
Posted by: slothrop | Jul 5, 2012 1:55:19 PM | 18
by William Blum
July 4, 2012
The Supreme Court of the United States has just upheld the constitutionality of President Obama’s health care law, the Affordable Care Act. Liberals as well as many progressives are very pleased, regarding this as a victory for the left.
Under the new law, people can benefit in one way or another depending on the following factors:
Their age; whether their income is at or below 133 percent of the federal poverty level; whether their parents have a health plan; whether they use tobacco; what state they live in; whether they have a pre-existing medical condition; whether they qualify to buy health insurance through newly-created market places known as “exchanges”; and numerous other criteria … They can obtain medical insurance in a “competitive insurance market” (emphasis on the “competitive”); they can perhaps qualify for various other kinds of credits and tax relief if they meet certain criteria … The authors of the Act state that it will save thousands of dollars in drug costs for Medicare beneficiaries by closing a coverage gap called the “donut hole” … They tell us that “It keeps insurance companies honest by setting clear rules that rein in the worst insurance industry abuses.”
That’s a sample of how health care looks in the United States of America in the 21st century, with a complexity that will keep a small army of lawyers busy for years to come. Ninety miles away, in the Republic of Cuba, it looks a bit different. If you feel sick you go to a doctor. You’re automatically qualified to receive any medical care that’s available and thought to be suitable. The doctor treats you to the best of his or her ability. The insurance companies play no role. There are no insurance companies. You don’t pay anything. You go home.
The Affordable Care Act will undoubtedly serve as a disincentive to the movement for single-payer national health insurance, setting the movement back for years. The Affordable Care Act was undoubtedly designed for that purpose.
Posted by: neretva'43 | Jul 5, 2012 3:07:38 PM | 19
"The Affordable Care Act will undoubtedly serve as a disincentive to the movement for single-payer national health insurance, setting the movement back for years. The Affordable Care Act was undoubtedly designed for that purpose."
Kinda restores your faith in the power of big money, eh?
Posted by: ben | Jul 5, 2012 4:08:36 PM | 20
Ecuadorian President Rafael Correa: "If an asylum request affects the relationship with Great Britain, the relationship between the United States and Latin America should be very affected, because ALL THE CORRUPT ECUADORIANS — THE BANKERS WHO BANKRUPTED OUR COUNTRY — ASKED FOR ASYLUM IN THE UNITED STATES. Journalists who defame go to the United States to ask for asylum. I think it’s established in international law, and every country has the perfect right within its sovereignty to analyze the possibility of giving asylum."
Posted by: JohnH | Jul 5, 2012 4:26:31 PM | 21
@6 Why allow banks this interest setting privilege at all?
Why indeed? We could set the prime rate by national referendum every quarter or so. It’s not a complex procedure -- up, down, or unchanged. After a bit of experience the voters would get a feel for cause and effect.
Posted by: Watson | Jul 5, 2012 9:11:47 PM | 22
"The public should not work for the banks' interest but banks should work for the public interest. If they can not do that under private ownership, seize them and run them as public property."
I agree - so long as we substitute 'confiscate' for 'seize' - just to make it perfectly clear to shareholders that if they don't demand that management put ethical behaviour and the public good ahead of devious means of increasing dividends in a stagnant environment, their shares could, and would, be rendered worthless.
The original JK Galbraith insisted that banks should be run as public utilities, NOT a source of unearned income for wealthy private investors.
Posted by: Hoarsewhisperer | Jul 5, 2012 9:16:19 PM | 23
From Friday, April 18, 2008 - 4 years ago. There's nothing new about this.
So right about now an intelligent person might be asking themselves "why is it only being portrayed as a 'scandal' NOW?"
British Bankers Association caught lying about LIBOR rates
The London Interbank Offered Rate (LIBOR) is the rate at which members of the British Bankers' Association (BBA) lend money to each other for a variety of currencies. This is a benchmark reference such that , for example the Granite Bonds isued by Northern Wreck were offered in different tranches paying above Dollar LIBOR. Rates are calculated by 16 panel banks across 10 currencies and 15 lending periods ranging from overnight to one year.
How is LIBOR calculated? (This is the BBA explanation )
The BBA uses Reuters to fix and publish the data daily, usually before 12 noon UK time. It assembles the interbank borrowing rates from 16 contributor panel banks at 11am, looks at the middle 50 per cent of these rates and uses these to calculate an average, which then becomes that day’s BBA LIBOR rate.
This process is followed 150 times to create rates for all 15 maturities (ranging from overnight to 12 months) and all 10 currencies for which a BBA LIBOR rate is quoted.
Plenty of room for wriggle room there then. What is plainly obvious is that the recent figure for LIBOR (especially $LIBOR) have been fiddle / adjusted / amended / reviewed to provie the market with a misleading impression.
Posted by: Hu Bris | Jul 5, 2012 10:30:22 PM | 24
Dodd-Frank is the proverbial "band-aid applied to a gunshot wound." Better step would be to reinstate and properly enforce the Glass-Steagall Act - possible, but unlikely. The lack of regulation reminds me of an old Steve Martin bit: "Hi! I'm Fred. I have a bank. Got some money? I'll put it...um...I'll put it here...in my pocket!"
An even more important, albeit nearly impossible step, is to reverse the US Supreme Court's decision in Santa Clara County v. Southern Pacific Railroad, 1886. This was the biggie, and the recent Citizens United case only a re-affirmation if this pile of steaming dog crap.
Also, though I'd have to dig a bit to cite, there were other decisions around the same time as the 1886 decision that re-defined the 'lifespan' of corporations, that, at least in this country, were meant to be temporary entities chartered for the purpose of funding infrastructure projects and similar large-scale endeavors.
Posted by: Dr. Wellington Yueh | Jul 5, 2012 10:31:54 PM | 25
""The public should not work for the banks' interest but banks should work for the public interest. If they can not do that under private ownership, seize them and run them as public property.""
Just who do you people think actually OWNS the Gov't?
Cos I can tell ye right now that it ain't you, or 99.9% of your fellow citizens
Posted by: Hu Bris | Jul 5, 2012 10:32:20 PM | 26
@6 Why allow banks this interest setting privilege at all?
Could it be - and I'm just making a wild guess here - that banks are owned and run by various very wealthy and very often psychopathic individuals/families as well as corporations (which are in turn owned by various very wealthy and very often psychopathic individuals/families and coroprations etc etc ad infinitum) and that if any sovereign Gov't were to attempt to withdraw such a priviledge from the banks that Gov't, it's citizens and the territory if currently thinks it controls, would find itself on the recieving end of some "Very Serious Shit"™, possibly not too dissimilar from what Libya and Syria have/are experienced/experiencing ?
I mean that's just my wild, totally off-the-wall guess, you know?
Posted by: Hu Bris | Jul 5, 2012 10:45:34 PM | 27
You are an old man who thinks in terms of nations and peoples. There are no nations. There are no peoples. There are no Russians. There are no Arabs. There are no Third Worlds. There is no West. There is only one holistic system of systems. One vast and immane, interwoven, interacting, multi-varied, multi-national dominion of dollars. Petro-dollars, electro-dollars, multi-dollars, reichmarks, rands, rubles, pounds and shekels.
It is the international system of currency which determines the totality of life on this planet. That is the natural order of things today. That is the atomic, and sub-atomic and galactic structure of things today.
And YOU have meddled with the primal forces of nature. And you will atone.
Am I getting through to you, Mr Beale?
You get up on your little twenty-one inch screen and howl about America and democracy. There is no America. There is no democracy. There is only IBM and ITT and AT&T, and DuPont, Dow, Union Carbide and Exxon. Those are the nations of the world today.
What do you think the Russians talk about in their Councils of State? Karl Marx? They get out their linear programming charts, statistical decision theories, mini-max solutions, and compute the price-cost probabilities of their transactions and investments, just like we do.
We no longer live in a world of nations and ideologies, Mr Beale. The world is a college of corporations, inexorably determined by the immutable bye-laws of of business. The world is a business, Mr Beale. It has been since man crawled out of the slime.
And our children will live, Mr Beale, to see that ... perfect ... world in which there is no war nor famine, oppression or brutality. One vast and ecumenical holding company for whom all men will work to serve a common profit. In which all men will hold a share of stock.
All necessities provided. All anxieties tranquilized. All boredom amused.
Truer words have seldom been spoken...
Posted by: Hu Bris | Jul 5, 2012 10:54:47 PM | 28
The original Glass-Steagle act was about 20 pages long. It stated quite clearly that deposits in investment and commercial banks were to be kept separate. As the New Deal evolved that meant that FDIC insured deposits could not be used by the investment bankers in their risky investments. The Dodd-Frank bill was over 1000 pages long. Those extra 980 or more pages of law built in one loop-hole over another that allowed the banks to use FDIC insured deposits to gamble in the financial markets -- i.e. effectively erasing the barrier between investment and commercial banks that Glass-Steagle originally erected.
This story is so complicated that there are few who realize what is happening. Perhaps a recent example will help explain. JP Morgan Chase just lost about $9 billion dollars in what is called proprietary trading that involved FDIC insured deposits. This was not enough to take them down but if it was it would be us, the US taxpayer, that would bail them out.
Posted by: ToivoS | Jul 6, 2012 2:30:27 AM | 29
The whole finance industry (banking, insurance, trading in commodities, derivatives, shadow banking, money laundering, etc.) is a complete mess, a sort of ad hoc construction where profiteers, coked-up risk takers, megalomaniacs, mavericks, criminals, quants, etc. as well as worker bees who bow down -to feed the family- gather. Collectively, they have manipulated and affected all of life - from energy prices to wheat prices to pension funds to land prices. Incl. legislation...
The enormous, unregulated, illegitimate profits also create political clout, with the banksters financing campaigns, buying election outcomes; or holding entire countries hostage thru their threats (collapse) and/or their tax contributions, which in many places are quite considerable.
Gvmts - in many places, composed of professional politicians - have not grasped what is going on and have been in awe at the money churning or creation powers.
This system was unquestioned as long as ‘growth’ appeared to lift all boats (tiny bones to the workers), or at least that was accepted, and the Industry was a little careful, sometimes modest, and pretending to probity, collaborating, etc. and perhaps planning for the long term.
That play-book went bust with US sub-prime crisis, Lehman Brothers, etc. (Madoff scandal played a part as well.) So now it is a free-for-all scrabble to make as much as poss in a short time, exit, etc. and / or defend the status quo, keep it going.
The different scandals are all still treated as ‘bad apples’ or ‘exceptions’ or ‘major fraud that is now uncovered!’ or glitches ‘in need of regulation’... too many ppl in power are benefitting from the profits.
The PTB cannot condemn the whole system so tout that tinkering around the edges will do the job -> Dodd-Frank, Tobin Tax, new Corp tax, closing down fiscal paradises, stress test on banks, Basel III criteria, new powers/roles for central banks (Europe), more power to shareholders, etc. Shadow banking, derivatives, price fixing, quant trading, drug and other money are not tackled, not to mention outright fraud, defrauding customers, complicit rating agencies, etc. etc.
Popular pressure is forcing a crack down on banker bonuses, in Europe at least, but that will change nothing.
Posted by: Noirette | Jul 6, 2012 11:08:41 AM | 30
Bank of America,bank of England,and Deutsch bank;How come they are really all the bank of Israel?
And there is the problem,as Israel is paramount and we are rubes to be fleeced,as they prevent oversight,have media control to deflect and neuter opinion,and control every aspect of our government.
Economic boycott is our only hope,as these twits of primacy understand only one language,the sound of dollars,shekels,pounds,Francs and marks jingle in their high pockets.
And thanks for nada,Presbyterian Church.(from a lapsed Presbyterian)
Posted by: dahoit | Jul 6, 2012 11:23:31 AM | 31
ACA equals the Patriot Act in its hypocrisy.What can we expect from the democrat traitors but republican laws?
Give me a sh*t sandwich labeled as such instead of one called filet mignon any day.Then at least we can take vitamins?or antitoxin supplements to fight off the effects,as with the false labeling we will succumb before we realize the poison.
Posted by: dahoit | Jul 6, 2012 11:30:29 AM | 32
“From the time I took office as chancellor of the exchequer I began to learn that the state held in the face of the Bank and the City an essentially false position as to finance.
When those relations began, the state was justly in ill odour as a fraudulent bankrupt who was ready on occasion to add force to fraud. After the revolution it adopted better methods though often for unwise purposes, and in order to induce monied men to be lenders it came forward under the countenance of the Bank as its sponsor.
Hence a position of subservience which, as the idea of public faith grew up and gradually attained to solidity, it became the interest of the Bank and the City to prolong.
This was done by amicable and accommodating measures towards the government, whose position was thus cushioned and made easy in order that it might be willing to give it a continued acquiescence. The hinge of the whole situation was this: the government itself was not to be a substantive power in matters of finance, but was to leave the money power supreme and unquestioned.
In the conditions of that situation I was reluctant to acquiesce, and I began to fight against it by financial self—assertion from the first, though it was only by the establishment of the Post Office Savings Banks and their great progressive development that the finance minister has been provided with an instrument sufficiently powerful to make him independent of the Bank and the City power when he has occasion for sums in seven figures.
I was tenaciously opposed by the governor and deputy—governor of the Bank, who had seats in parliament, and I had the City for an antagonist on almost every occasion.”
William Ewart Gladstone
Posted by: Hu Bris | Jul 7, 2012 12:39:43 PM | 33
What is the Board of Governors of the US Federal Reserve doing pegging US loans and mortgages to a foreign bank index (LIBOR)? We have the FedUS Funds Rate (FFR). Had that been the case in 9/2008, the Fed could have taken action to reduce mortgage payments here and done something for Main Street in addition to Wall Street. This is the equivalent of allowing the private sector of our economy to be controlled by a private overseas financial concern. This is the outrage exposed by the LIBOR scandal.
Complain here (The Board of Governors, appointed by the President, runs the Federal Reserve, not its 1,000 shareholder member banks):
Posted by: MRW | Jul 7, 2012 10:49:50 PM | 34