LIBOR ANALYSIS: The hints of global fireworks in the FSA’s Barclays rationale


A close examination of the FSA rationale for fining Barclays points – along with other established facts – towards bank rate fixing that goes way beyond both Britain and Barclays. In fact, the connections apparent across the piece of this rapidly developing scandal suggest that nobody ‘saved the banking system’ in 2008: key players intimately involved in the sector simply lied about the cost of borrowing….using a fraud both well-established and near universal by then.

By becoming embroiled in a fruitless search for who said what to whom and when, the MSM have I think missed two vital points from the written rationale behind the FSA fining Barclays a total of £290m. In my view, enquiries and seclect committees and all the rest of the Establishment’s delaying tactics are pointless, because it’s brutally obvious that almost every witness (and half the examiners) employ practices they wish to either play down or hide.

Above all, the FSA document suggests a degree of coordinated action very damaging to the British political class; and it suggests very strongly that a large number of banks across all continents must be involved.

In section 8 of the FSA  rationale we find this (my emphasis)

Barclays acted inappropriately and breached Principle 5 on numerous occasions
between January 2005 and July 2008 by making US dollar LIBOR and EURIBOR
submissions which took into account requests made by its interest rate derivatives
traders. At times these included requests made on behalf of
derivatives traders at other banks. The Derivatives Traders were motivated by profit
and sought to benefit Barclays’ trading positions.

This is an explosive paragraph, because it establishes (1) the manipulation was at least three years old before 2008 (2) It was not just Libor but also Euribor that we see involved here and (3) the derivative trader sector beyond Barclays was well aware of the scam, and used it regularly to create (or recover from) positions taken.

In this initial period – when the world was in a new paradigm and did not need saving – borrowing rates were lied about up and down to get kickbacks from/do favours for derivatives traders inside and outside the bank. Essentially, the parallel is that of punters at one roulette wheel persuading a gambling house to weight another wheel so they can get their money back.

This was in a market worth $554trillion in 2011, so you can imagine the sums involved. The sums are in dollars, and the fixes apply to both UK and European rates. It is therefore very hard to imagine that the Central Banks had no idea the practice was going on. Plus we also know that, once this profit-fraud became a save-the-world gambit, Swiss outfit FTC sued 16 banks on four continents about libor rate fixing in 2007/8.

Think about this applying commonsense logic. Over any given trading period, all the banks are chopping and changing staff regularly between each other. It is inconceivable that Barclays is the only villain between 2005-8…any more than Newscorp was the only phone-hacker after 1998: what we’re seeing is a widespread, nudge-nudge blind-eye practice taking place across the piece.

Now put yourself in the position of being a senior Minister conversant with the banking system (for example, Gordon Brown), a senior Treasury mandarin of even more ability, and the Governor of the Bank of England. Or Hank Paulson at the Fed and Jean-Claude Trichet at the ECB. One thing all these men freely accept is that, during late 2007, they began to see the global banking system’s liquidity drying up….the result of mutual distrust, fear and rumours about competitor solvency. These guys are having G20 summits and attending the same banking seminars all the time. But they never talk about rate fixing?

Alright then, let’s be kind and assume that they’re all spotlessly clean on this issue. However, in late 2007 Deputy BoE Governor Paul Tucker makes a call to Robert E. Diamond, the man in charge at Barcap. This is significant in itself because, no matter who you believe, they can at least agree upon the subject spoken about: Barclay’s declared Libor rates being well on the high side compared to most other banks.

The FSA document takes up the story:

Liquidity issues were a particular focus for Barclays and other banks during the
financial crisis, and banks’ LIBOR submissions were seen by some commentators as
a measure of their ability to raise funds. Barclays was identified in the media as
having higher LIBOR submissions than other contributing banks at the outset of the
financial crisis. Barclays believed that other banks were making LIBOR
submissions that were too low and did not reflect market conditions.

Now this is key. Having moved on from cheating the public to hoodwinking the media, Barclays staff are already lying ‘downwards’ about the borrowing rates in order to ensure there is no whiff of liquidity problems at the bank. Now they find that at least 11 other banks are lying even more. Tucker has done no more than observe that Barclays Libor submissions seem ‘on the high side’. Two questions:

i. Why does he seem worried about that in the first place? Because he is AWARE of the impending danger of bank-panic.

ii. Why does he imagine Diamond can do something about it? Because he knows that the banks have been fiddling the rates for years.

I have no doubt at all that, in his evidence to the TSC tomorrow, Tucker will say “I merely rang to receive Diamond’s assurance that the bank was OK”. Rubbish. Tucker knows that, of all the banks, Barclays is the most independent, and the most scathing about the ideas of both regulation and potential nationalisation. What does he expect Bob to do, tell him the truth?

Anyway, Diamond now goes to his 2ic Jerry del Missier and somehow this guy manages to mishear his boss saying that they need to cheat even more on Libor. He doesn’t ask Bob to repeat the order, and in the ensuing four years of working closely together, only a few weeks ago does he realise that Diamond said ”try more” or “buy more” or “my boar”, as opposed to Libor. This is obviously total bollocks, but is not germaine to the point here: the fact is that del Missier trots off to ‘lie more’…such that – miraculously – all the Libor contributing banks have almost exactly the same rate…and thus not too long afterwards, FTC gets miffed about its client forecasts being wrong, and takes the pretty damn big step of suing the global banking giants.

It’s unlikely bordering on impossible that this synchronised fraud is done purely between the banks with no other parties being involved.

Here’s why, in plain English: only a mad senior banking executive would make the first phone-call. A request to illegally fix the rates low would be seen immediately by the other sharks as clear evidence of a drowning prey. This is why Libor’s secrecy and discretion via the BBA exists in the first place.

The only way such coordination could’ve been achieved is via central banks. And again, the same rule applies as above to the idea of a bank approaching the Central Bank: that marks you down as a Northern Rock who has reached the desperate stage of implosion. Far more likely is that the key CBs and their grovelling politicos initiated the idea: “we must all stick together or hang together”.

I have two sources – very senior sources – one in an investment bank and one a former Treasury official – who are not only clear about the fact that there was widespread talk of Libor fixing to save the banks: they are very clear that Gordon Brown for one was yelling at various bank CEOs on a regular basis during this period. He obviously believed that they weren’t going to recoil in horror at the idea.

And one can apply that same principle to the Paulsons, Kings, Tuckers and Trichets of this world: is anyone in such a position of senior probity likely to risk his neck by openly suggesting the banks lie about one of the most revered institutions in the financial sector…if he suspects they’ve never done such a thing before?

While so far I have focused on both the global and conspiratorial nature of the Libor rigging practice, there is also a final factor that spells potential disaster for the Conservative Party in particular. Neither Cameron nor Osborne were in office at the time, but a staggering number of the Party’s senior players, donors and facilitators have been deeply involved in Libor credit broking for years. The brokerage sector is the most potentially dangerous wire in this UXB.

If you were going to try an save the banking system by under-reporting Libor rates, would you bring the key brokers onside, or leave it to chance? Suppose one of the more honest brokers decides a fix is in, and rings up the FSA. No, it’s far too leaky: you have to get them inside the tent as well. In fact, if you coordinate the fix THROUGH the brokers, everyone wins: the FSA is pretty useless about libor broking; doing so is far more discreet than banks informing the BoE and Treasury direct; three big bananas control the whole sector – so it’seven less likely to leak; AND most of the political class are in it up to their necks.

I think it highly unlikely that the fix was put in during 2007-8 without getting the brokers onside. The biggest players there are ICAP and Tullet Prebon…inside those companies right at the top are megadonor Michael Spencer, Deputy Tory Chairman Michael Fallon, and Tory supporter Terry Smith, the Tullets CEO.

Farfetched conspiracy bollocks? Look at the Torygraph piece from Thursday about why Brown really sold the UK’s gold at a low price. The then Chancellor did it to help the banks, who had made bad bets on gold: he therefore publicly and with notice dumped an enormous heap of gold to get the price down. This is EXACTLY THE SAME as Barclays helping derivative chums to get their money back on bad bets by massaging the Libor up and down.

The whole idea that ‘the markets must decide’ has always been drivel. It is being shown up increasingly, however, as cant: the stock markets have been rigged and propped up by QE, the Gold market has witnessed secret sales and Fed dumping for years, and now the Libor rate is revealed as a way to screw bank customers by those in search of illegal riches, to retrieve hopeless bet positions by fraud, and then save the brass necks of investment bankers who have already been bailed out by obscene injections of public money.

Nobody believed a word Bob Diamond said in testimony last Wednesday, but he is not the issue. He is gone from the scene – and for The Slog, that’s a major result. Paul Tucker is one level of conspiracy higher, and I don’t expect to find his evidence tomorrow to be either truthful, or credibly explanatory. Just as with Hackgate, the closer we get to the epicentre of this vortex of villainy, the dafter the raionales, denials and memory failures are going to get. We should not make the same mistake as we did with Hackgate: we should launch a multinational and powerful criminal investigation, and start getting some gargoyles in the dock. Otherwise, the usual ‘enquiry as filibuster’ outcomes will apply.

Related: Why I’m all Enquiried out

92 thoughts on “LIBOR ANALYSIS: The hints of global fireworks in the FSA’s Barclays rationale

  1. No one responsible will be busted for this. If, and that’s a very big ‘if’, you could charge say, a dozen of them at the top of this massive fraud, you would destroy the banking system.
    IMV, possibly someone low down the pecking order will take the blame, do a little time in an open prison and pocket and nice payout for doing so.Then, a ‘line will be drawn under the matter’ ‘lessons will be learnt’ and will we lurch onward to the next crisis.

  2. This paints an incredibly grim picture of truth JW. I feel the global
    taxpayer is due recompense for rigged high mortgage rates and rigged low saving rates since 2005. Dont you ?

  3. I think it is becoming clear that Libor was manipulated before the crisis and that this was probably known to the authorities. We might call this “bad” manipulation as it was designed to ramp up banks’ profits at the expense of everyone else. However the later situation seems to have been used for “good” manipulation at the height of the crisis to lower rates and ease market fears. I recall working in the City at the time Lehman crashed. The fear was palpable. That this “good” manipulation may have been instigated from the highest levels would be no surprise. The ends justifies the means and all that.

    Bob Diamond is reported to be in shock at the way he is treated (see DT). Whether you think he is a crook or a fall guy (or both) what happens now with him will be very interesting. He has in the space of a few days gone from being a master of the universe to a vilified public figure with a good prospect of spending a few years sharing a cell with a new boyfriend –possibly in his home country. From people I know who have worked with him, he is described as a very good operator, sharp, intelligent, loyal to people and – perhaps within his own set of morals – honest. He is going to be mighty sore at all of this and will come out fighting. He can afford to hire the best lawyers money can buy. There is the usual bllx about his severance package but I suspect he will have been advised to obtain immunity from prosecution as part of the price for his silence. If the US authorities get involved I have no idea how he will protect himself.

    However I just can’t see him taking the fall for what might be termed an “institutionalised” problem. And he will be the first of many bankers who will be taking legal advice and looking to pass the blame upwards. Where it will stop nobody knows. Personally I think GB should be in that cell for abuse of his position over many years, though I don’t think being an arrogant, aggressive control freak is a crime.

  4. You can kiss the idea of monetary recompense goodbye I think, as far as legal recompense is concerned, I agree with kfc1404, someone will take the bullet, serve time in an ooen prison and pocket a nice payout for doing so.

  5. Big money involved in the US on the Pension fund rates – I heard the other night on CBS that fund Companies are queing up to slap a ‘class suite’ on those banks involved

  6. Dis HM the Queen ,not visit the London School of Businsess in 2008 and ask “who coulda known”-why were all those brilliant academics so hoodwinked for years prior to 2007 and why are these so so called elite institutions allowed to operats as univerities?Of course they are just bought off with sinecures!

  7. Agreed. Once litigation starts this will not be possible to hide, and the web will provide information to fuel this process.

  8. I know all you intellectual types don’t read the “Lifestyle”section of this mornings Telegraph(Sunday Telegraph 8th July2012),but just perhaps the people are awake,if inebriated.A few banker types were verbally abused on Friday on their way from a day of plundering at HSBC et al,by a few overly ripe peasants.I seem to remember the same banking community swilling champagne and hoorahing for the cameras a number of years back.Now that the shoe may be on the other foot,well of course its different-but good to see their collective unnerving.
    Just in case plod is unaware as to who to arrest,well just throw nets around these commuting trains and let them spill their collective job titles-just a suggestion.
    Above all that poor Nuremburg defence will not do of “I was only doing my job”routine is not and will not be acceptable to the extraditions that are coming.

  9. @SITC; You may well be right but, I will believe it when I see it. They have all colluded to perpetrate this crime, they will all collude to evade the consequence of it.

  10. So let me get this straight. A financial scam of global proportions has occurred, and seems to be centred here in London. It occurred in the period 2005-2008, or possibly even before. The major public players were all Labour or Labour appointed ones, and the financial system was entirely created by Labour, who were in power at the time and had been since 1997. Some of the private players were Tory supporters (who’d have thought it – City types in Tory support shocker) though.

    And this is all the fault of the Tory party who at the time (2005) had just lost their 3rd straight election, were nowhere near the levers of power (and looked as if they never would be – strangely it wasn’t until the wheels fell off the economy they picked up in the polls. If Brown had gone to country in Oct/Nov 2007 he would have got a small majority).

    I call BS. Cameron and Osborne may be implicated in this in an ‘OMG this sh*ts been going on and all our money backers are implicated, we can’t drop them in it because we’ll be f*cked’ type of way, but thats irrelevant. They didn’t create the system, they didn’t choose the people involved, they were not the government at the time with any power whatsoever. The person(s) with maximum responsibility are Tony Blair and Gordon Brown. They were in charge, they undoubtedly knew what was going on and probably (in Browns case by 2007 onwards) actively encouraged it in order to save his own political skin.

    But you’re more worried about sticking it to a couple of Eton toffs, so hey, why worry about the real culprits?

  11. Doesn’t this all land up with the BoE? They have a well defined market supervision function and, if this goes along with a Libor fixing process based on what bankers say rather than what they do, it seems to me that they are stupid at best, negligent at worst.

  12. Copy to:Dr Conan Fuller-Bollix. International Banking Con Group have acquired through SIV Dutch-Mega Cap the entire share base of Anglo-European Whitewashing PLC.Market projection is Bull. Footsie gains two percent.

  13. Cameron made it into power after fighting an election on a manifesto pledging to “empower the Bank of England to crack down on risky bonus arrangements”. His coalition partners had promised to “ensure that the bonus system can never again encourage banks to behave in a way that puts the financial system at risk or offers rewards for failure”. Together, incessantly, they vowed that, at last, Britain was all in it together.
    Maybe someone should remind Scameron of this ‘promise’ he made. But, there again he is good at making promises and breaking them, isn’t he?
    But, he was right about one thing, the LIBOR scam, they are all in it together, aren’t they?

  14. I gave a talk to an LSE group in March 2009 and quoted the Queen but pointed out that many of us had been warning of this for years but everyone was having too good a time to listen to us old Cassandras.

  15. When is a charade not a charade? When it is not perceived, apparently. Well, thanks to JW and others like him this is no longer the case. What a rotten, stinking and utterly corrupt mess; a tragedy of truly Shakespearean proportions. That this goes to the root of our banking system/establishment, as some of us have long suspected, it is no longer possible to deny. Those who have posted here that Libor is an insignificant distraction, they know who they are, should eat their words.

    “Canst thou believe thy living is a life, so stinkingly depending? Go mend, go mend.” (Measure for Measure)

  16. He can turn state’s evidence in the US and escape punishment or he can nobble the judge and the jury. Money talks in the finest justice system that money can buy.

  17. Hopefully Tucker has blotted his copy book and the next Governor of the BOE will be an outsider.

  18. They say the fish rots from the head down. The bankers are clearly crooks, but ultimately the overall responsibility lies with the politicians who were supposed to be in charge & who could have stopped it. The fact that they didn’t shows that either they are fools, or knaves. I would suggest that the ‘Eton Toffs’ may not have been in charge at the time, but they, being bankers & from banking circles, must have known what was going on, so they are guilty by association.
    Was it the case that ‘not one of the mice was willing to bell the cat?’
    As is also the case with the Euro shenanigans, another con.

  19. Criminal proceedings may be avoided but it is hard to see that civil actions will not be pursued for losses. Anyone who bought a capped rate hedge product based on Libor may well have lost out depending on the structure – just for starters. And hedge funds are not noted willingly losing money.

  20. Pingback: John Ward – Libor Analysis : The Hints Of Global Fireworks In The FSA’s Barclays Rationale. Who Will Light The Bluetouch Paper? – 8 July 2012 | Lucas 2012 Infos

  21. Worse than no-one getting nailed for it, with the Banks able to say they were co-erced by government, they now get off scot-free from everything. They can play the joker every time -“whispers in our ear to save the system (at all costs)”
    This might be game over for us, bar a few token scalps, thanks to Gordon.
    Merv, grow a pair and dump everybody.

  22. Sometimes I think … I do not want to know the truth.

    Why? In this little titbit mentioned in the article and you know they must have had a few conversations over it.

    “One thing all these men freely accept is that, during late 2007, they began to see the global banking system’s liquidity drying up….the result of mutual distrust, fear and rumours about competitor solvency”

    Or was it a few bankers and politicians getting really cold feet on the fraud?

    The last bit though, “SOLVENCY”!

    Liquidity, money, value, worth, debt are all based on having some asset worth the paper it is written on or coinage minted. When the liquidity balloon went up it is like Pandora’s box, never to be closed again until somebody shows the asset that covers it all. Everything is a fudge now, manipulation, lie, deceit, deception because the asset it is all based upon is like worthless or certainly close too it in relative terms.

    Does this asset actually exist? Did it ever?

    So besides leveraging up bits of paper to try and make the numbers add up the puzzle now is where could the asset with a value of say 200 trillion have been misplaced? Misplaced a new name for never existed.

    If anybody does find missing asset please inform the central bank HQ PDQ otherwise somebody will be taking a bullet PDQ for misplacing it and then don’t let it happen again.

  23. We all need to move beyond tribalism, politicians of all hues have demonstrated their duplicity, their incompetence, their cowardice, their greed, their arrogance, their self service etc. From the thickest of union sponsored MPs to the 1st class honours Oxbridge brigade they have collectively demonstrated an inability and / or unwillingness to address the problems. Is the consequences of addressing the issues so dire none have the courage to act? Are they so bad that no politician dare tell the public the truth and instead invests in spin and propaganda and distractions? Whatever, I fear that the can will continue to be kicked by one team or the other until ultimately some poor sod is left with nothing to kick. In the meantime blame your predecessor and pray you not last man standing, it’s like some macabre game of pass the parcel.

  24. Let us all wait and see what the big four auditors come up with, on the balance sheets, and the need to adjust for rate interference. Several European Banks are struggling with the auditors right now in getting them to sign off on latest reports. The response from the big four is we need more time, more money, more advisory contracts to see what massaging we can do. The word out from the banking specialist teams are that more thn 50% of European Banks are insolvent.

  25. Q. At which merchant bank did Paul Tucker learn his ‘market experience’in a 4 year period,before returning to the Bank of England? A. BARINGS!

  26. Calling all Sloggers
    I am thinking of protesting outside my local branch (Broadstairs, Kent) of Barclays, along the lines of move your money or close your account.
    There has been a #ByeBarclays twitter campaign, I thought sloggers could join in and make the most of a weak point with the Banking ****!!1**
    Anyone else up for it?

  27. This is closer to reality than many will want to admit. The reason both Blair/Brown connived/acted in the way they did in 2005-8 and the reason Cameron/Osborne have tried to sweep it under the carpet are the same – a) naked political advantage because b) we are f*cked economically. Neither want to be the ones to tell the British masses the games over. The fiat money experiment has finally run out of road. If any government says to its people ‘Sorry guys, we’ve completely screwed you for 40 years, lied to you about what you can expect as a nation in terms of living standards, and you are all massively poorer than you think you are’ there could easily be a revolution. A violent bloody one. Certainly the party who confesses to the truth will never rule again, despite its opponents being as guilty as anyone else.

    Democracy needs a reboot. An election should be held where anyone who has any political connections whatsoever should be barred from standing. Then and only then might we get a government who is prepared to clean the Augean Stables that is UK public life.

  28. Looks like we are also getting a helping hand from Twitter. On a birthday card received the other day I was invited to join TWATTER, where you can leave short, grumpy messages for people you don’t like.

  29. Global banking looks set to be engulfed by a veritable tsunami of compensation seeking litigation. Already a number of class actions have been filed.
    In manipulating the rate Barclays and other defendant banks paid lower interest rates to clients and counterparties than otherwise.
    But since nobody appears to know what the real interest rate should have been, establishing the size of any loss is going to be fraught with difficulty. And in any case, those who did suffer a loss might in turn have gained from the lower interest rate in subsequent transactions. Just establishing a formula for who lost what to whom will be a legal quagmire.
    Just as there is really only one set of winners from all this – the lawyers – there is also only one set of losers – as ever, you and me, the bankers’ customers, who will end up paying for it all in higher charges.

  30. Occupy LSX were rght, but went about it wrong.

    Got to fight back with flamenco in the banks.

    Don’t even need a crowd. You can also go solo:

    (a short one)

  31. I think you are forgetting that the deregulation started in the 80’s under Mrs. T. & Reagan over the water. Blair & Brown then kissed the City’s big fat ass, Clinton did the same with his gang of 3, Rubin, Summers, & Greenspan in repealing Glass-Steagall & preventing proper regulation of derivatives.

    There is not much difference between any of them including the present incumbents. The devil only needed a big wad & light touch to buy these power junkies of whatever stripe, but now the rats are being driven further into a stinking corner. Like Hitler’s cronies they will try & save themselves when they finally realise the game is up. No honour amongst thieves & all that.

    With this there grows
    In my most ill-composed affection such
    A stanchless avarice that, were I king,
    I should cut off the nobles for their lands,
    Desire his jewels and this other’s house:
    And my more-having would be as a sauce
    To make me hunger more; that I should forge
    Quarrels unjust against the good and loyal,
    Destroying them for wealth.
    Macbeth 4.3.91-99, Malcolm to Macduff in an attempt to prove Macduff’s loyalty to Scotland

  32. Stevie, New Labour were responsible for the FSA. They were responsible for light (i.e. no) touch regulation. Sure there was a deregulation process in the 80’s, much of it needed. If it had been left at that this situation could not have happened.

  33. Read carefully, the message is:-

    The elite establishment are all corrupt.
    Pay close attention to your taxes (direct and indirect) and also to the holders and investors of your money ,/b> and then
    because it’s your fault and YOUR LOSS because of YOUR ACTIONS.

  34. Another great piece of work John,slightly different take though.In 2005 the Banks realist their predicament & began fiddling the books,by 2007 politicians were aware of the banking issues & were seeking solutions now they may have been aware of the Libor scandal & decided to legitimise the banks actions by influencing libor themselves or just has likley, someone saw a opportunity to legitimise their actions by advising the politicians it could be done.
    I personally do not believe that politicians were the instigators of the fiddling & therefore the question is how did they become involved who gave them the idea & when.
    This will never be answeredespecially now that we do not have a independent inquiry

  35. I think your investigatory efforts wrongly conflate two very different issues: (a) who was in office and had power and control during the period of Libor manipulation as far back as 2005 or earlier and most certainly knew about it and probably co-ordinated it, with (b) the political allegiance of a few players involved in the scam, who were only doing what the Chancellor/PM wanted/allowed them to do when he wiped away regulation and praised The City each year at the Mansion House. You might as well say that the political allegiance of any offender reflects badly on his favoured political party. I don’t think many juries would buy that.

    Sorry, but Blair (possibly through negligence as First Lord of The Treasury and fear of Brown), Brown, Balls, the Treasury and the people they appointed in the FSA & BoE are all up to their necks in this scam. These are the people who presided over it and if a proper criminal investigation is ever carried out and presented to a jury, will be shown to have conspired together.

  36. I find all the chest beating and gnashing of teeth over this libor thing to be incredible! Bankers telling lies to enrich themselves is pretty unremarkable surely? It’s a bit like headlines saying ‘pope discovered to be Catholic’ or ‘bear shit found in the woods!’

  37. I propose action. Mass opt out of PAYE in protest against institutional corrpution. HMRC can’t cope with current volumes, let alone x million new returns.

  38. Good idea. I already closed my account with Barclays in 2009 when I discovered they were involved in another unrelated racket, which I believed amounted to fraud.

  39. Spot on ! This is yet another Labour Party cock up. Because of that JW isn’t interested in the reality of it because he can’t stick it to the Tories. It was Brown and the ghastly Balls who created the regulatory framework which allowed this to flourish. And Ed Miliband was there too as bag carrier.

  40. John, if you really want to get to the heart of this mess, here’s some details of a real criminal investigation that’s needed, which rigging Libor is only a part of and a consequence of:

    – Brown swept away all existing banking regulation in 2000 and replaced it with his tri-partite model (FSA, Treasury & BoE). Much confusion followed between the three outfits regarding who was responsible for what.

    – In the years that followed it became clear that credit in the economy was going out of control (house prices went through the roof, personal credit reached £1.5 trillion). Very many warnings were given to him about this looming disaster, but he ignored them.

    – Brown gave annual speeches at the Mansion House praising the City, as recently as Spring 2008. He also created a new mantra: “I have abolished Tory boom and bust”.

    The question is whether Brown set out to deliberately and knowingly destroy the British economy or whether he is guilty of unimaginable incompetence and negligence in public office. Such an investigation would almst certainly draw in other New Labour apparatachiks like Blair & Balls and probably other Cabinet Ministers. So far, Brown & Co have been allowed to get away with it. That should not continue.

  41. Soap

    I agree, I am merely stating that the economic philosophy of Freidman later taken up by Greenspan of the market if freed from any restraint, would solve all our problems in the 80’s became the modus operandi of the political & financial elites.

    I think it has been proven that all of the parties mainly through donations & the power of lobbying over the last 30 odd years have been in & are in bed with the financial elites resulting in the mess we now find ourselves.

    I have no time for Bliar & the Brown turd but to try & shift all the blame onto them is absurd. Would the present shower have done any better then in the same circumstances?, Which of the parties depends most on the City for financial support ? . They are all careerists bought by the highest bidder, their labels are meaningless & whatever integrity they might have once had, is like everything else, in deep recession.

  42. It wasn’t light touch regulation. It was wrong touch regulation – reams and reams of unintelligent box-ticking compliance bollocks, metaphorically checking the roof tiles were the right size, colour and thickness at the correct angle with the mandated fixture method while ignoring the fact the scumbags were busy excavating the foundations underneath the building. Using a sledgehammer to miss a nut.

  43. So you claim Blair approached the banks from the outset to fiddle the figures & Tory party donate joined in rather than finish Labour for good on corruption
    Sorry do not buy that no doubt Blair/Brown did wrong but the corruption was already rife

  44. The SFO should sort it all out, or don’t you have any confidence, they could use your proof, if you have any.

  45. Stevie, I can’t disagree with any of that really. Cameron etc are just a new colour of filth, although I don’t think they have yet descended to Blair depths.
    Obviously there has always been and always will be an element of corruption any where where there is big money or big power.But For my money 1997 was a watershed in this country. On the day Blair was elected we descended to a new level of corruption. I think in an attempt to get elected the tories have found their own Blair and the Lib’s too.
    I suppose my take on it is that we have not really been having a free market, we have been having a rigged market. I worry that this whole situation could lead us back to the tired old socialist “we must control everything” crap. In my head this is crazy, we would be giving more power to the politicians who helped cause it.
    What we need is a fee market, but backed up by the rule of law. If you break the rules you go to jail. It is the lack of enforcement that is the real worry.

  46. Ghost. They were the ones that created this entire system. they used the banks to inflate our economy, through the rampant printing of money so they could spend tax income that didn’t really exist. How else do you think they “ended boom and bust”. You may not like it but the Thatcher and Major governments were saints in comparison. Balls and the other filth are still leading labour. Unbelievable really

  47. Already too late, every word of bt’s post is in the public domain. So what proof are you looking for? You think he was not negligent? You think no one warned him? And I’m presuming that you were being sarcastic when you asked about having faith in the sfo?

  48. Personally, I am not satisfied regarding the MP’s expense scandal, I think what should have been a complete clear-out and lots of criminal proceedings never took place, just a white wash.
    There will never be a clear out of the major corruption until a large portion of the people wake up and demand action.
    Some people question whether this Libor scandal is really that important, I just hope it is the catalyst to bring all the dirty dealing to the surface.
    The economy is fried, and reality won’t get kicked down the road forever, so, the sooner this monstrosity of a system is brought down, the better.
    We are all going to suffer whatever, so bring it on!

  49. ‘The question is whether Brown set out to deliberately and knowingly destroy the British economy or whether he is guilty of unimaginable incompetence and negligence in public office’.Since May 2010,I have been informing on The Havana3,Garry ,Pavlov and MarK,and now it is coming clear that MarK had recruited his successor,Ephesus,from Trinity,Cambridge.BTW, the in house legal advisor to MarK,Vanessa, is a Trinity Hall man.Philby, Burgess,Maclean.Ring a bell?

  50. @the ghost: I didn’t claim anything of the sort. Blair’s guilt is (at least) that he was First Lord of the Treasury between 1997-2006. That duty requires of him in the national interest to oversee his appointed Chancellor to ensure that he’s a fit and proper person for the job. Brown was obviously not, but Blair failed to sack him. It was Brown’s sweeping away of all regulations c2000 that really got the City going into overdrive and creating the shambles we see today.

  51. @IATL: As @soap rightly says “it’s all in the public domain”.

    Do I have confidence in the SFO? No…due to a mixture of them being part of the Greater Establishment and their lack of expertise. All aggravated by laws that are way too lax, ineffective and open to interpretation by another corrupt outfit: the CPS.

  52. @william: There might have been a time when such a conspiracy ruled from Moscow was a stretch too far. Nowadays, it has to be considered as a possibility…

  53. Two party politics are no different in the US and UK.
    Both are just an illusion of choice.In reality they are both
    just different wings of the same party.TPTB party.
    They all need to be strung up from the nearest available
    lamp post.,and their heads thrust on spikes as a warming.

  54. Soap

    Totally agreed again, I think the book should be thrown at Bliar, Brown & anyone else who had a hand in, as you say this gigantic scam of a rigged market. I also share your fears that the inevitable reaction to this mess will be the pendulum swinging to far back the other way, resulting in populism as is being shown in Europe or as you say a backwards step to socialist over control.

    You might be interested in this guy, by the name of Rowan Bosworth – Davies, an ex cop who amongst other things was a Scotland yard fraud detective. He is starting to post a series of articles on his blog spilling the beans on City behaviour. Like John he is very angry about the state of play & also like John doesn’t pull any punches. If it were up to me I would put him in charge of the regulators & sit back & watch the fur fly.

    Here is his starter for what I am sure will be plenty of substantial meaty main courses :

  55. Diamond is by no means the fall guy — at this point, where he has been the subject of an investigation which levied fines of 290 Pounds Sterling — even an amateur pulp detective fiction writer can see that he is very likely part of a very intense and deeply thought out sting operation. Huge leverage has to be applied on high levels to wring some safety into banking and finance. Maybe the public will see some low level person take a rap as kfc says, but the action is where JW indicates. Not just way up, but so high up and, er, diversely sideways in too many wells and directions to ever be spelled out in public. But the leverage will be applied and they will make some amends and remedies or sink the bloody planet if not.

  56. It is very clear that forces more powerful than the Establishment are at play here and they are increasingly lifting the veil on the global elite for all of us to see.
    I have no doubt that justice will be served in some form and that the equity based financial system being introduced by every country outside of the G20 will mark the end for The Powers That Were.
    2012 IS the year of total change.

  57. Here’s a dreadful and telling line from ZH: ‘The big banks no longer do very much traditional banking. Most of their business is from financial speculation. For example, less than 10% of Bank of America’s assets come from traditional banking deposits. Instead, they are mainly engaged in financial speculation and derivatives.’

  58. It’s taken a long time for you to get here John. I guess you’ve been listening to the wrong people , to be charitable.
    I may be the only one in the whole world at the moment to back Barclays 100 per cent and be glad to see Bob Diamond back asap!
    Incidentally, I am only a couple of hours up the road if you fancy a few jars and a chat before you brave the UK again.

  59. Monday should provide a number of clues regards ‘the financial conspiracy’ when Tucker gives his evidence. 
       I believe that the politico’s will provide an easy run for him. They have there fall guy in ‘geezer diamond’ and would prefer the story to die away. 

  60. Why do I get the sense that this will end up with the whitewash results as investigations into climategate? In that scam the evidence against those involved was down on paper in their own hand and still justice did not prevail. I’m afraid it’s one rule for us and no rules for them!

  61. Thanks for your comments Mike. It appears that a few of us, on this blog, saw through the fog. JW has at last seen the light. 
     It wouldn’t surprise me if the diamond geezer didn’t finish up in charge of the new Barclay Investment business ( in the USA).
     Who knows the whole investment industry may leave London after this witch hunt.
     Will the real conspiracy ever come to light?  

  62. @OAH.Ephesus=Tucker,many knew he was a dodge at Barings(whose balance sheet was propped up by interest free money from the deceased Russian royal family,by chance).Vanessa,look up the Old Lady’s webb site,and be more imaginative than the boys from Moscow,who are masters at the long game.So far,I would say MarK is winning.

  63. @william:
    If I read it right, “Vanessa”, stepfather of a pro violinist, has exactly the right CV to be the ideal brief for the Diamond Geezer type that proliferates the nudge-nudge world of derivatives trading…

  64. Pingback: RATE-RIGGING SCANDAL: as The Slog predicted, detection of the scam is going global. | A diary of deception and distortion

  65. Pingback: John Ward – Rate-Rigging Scandal : As The Slog Predicted, Detection Of The Scam Goes Global – 9 July 2012 | Lucas 2012 Infos

  66. Seeing Bob Diamond doing the perp walk in handcuffs and an orange jump suit would be sufficient compensation for me.

  67. Regulatory frameworks are a load of bollocks no matter who created them. Their real purpose is to keep market players out of jail while offering a sham veneer of “doing something” for the public and coming up with big fines that divert attention away from the fact that criminals are not being prosecuted. The political class as a whole are guilty of conspiring with financial services players to bring this crony/fascist system in to being and continuing with the game.

  68. The next part of the Libor scandal to hit will be the £12bn Capital raising by RBS. If as suspected the bank was ‘Insolvent’ and rigging Libor rates lower to achieve a different analysis, its prospectus was ‘illegal’ and then add together HBOS manipulation of Libor rates that saw Lloyd’s go from a strong bank to a basket case within hours of the merger courtesy of Mr Brown, we have the case for not only bring the RBS to the dock, but the BOE, Labour Government members and a class action against Labour & Brown plus others in his cabal.

  69. Pingback: RATE-RIGGING SCANDAL: as The Slog predicted, detection of the scam is going global. [The Slog] « Mktgeist blog

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