Barclays guilty of manipulating interest rates

MooMoo444 · 28 Jun 2012 at 13:30

Wouldn't mind some money back.

=D

Calabi · 28 Jun 2012 at 13:47

Telescopi said:
Because our regulators are honest and dig up the fraud?

I know it's a laughable concept given the current problems but not as laughable as thinking bankers in other regions are more honest.

We have the worst legislation and and regulators in the world. Thats why everyone banks here.

I'm wondering how bad things will have to get before something is done. There's huge amounts of **** going on with the banks. Its hilarious how blatant it all is and somehow everyone else but the people responsible for it have to suffer.

Tummy · 28 Jun 2012 at 13:51

Surprised these people remain out of jail.

Crimefighter · 28 Jun 2012 at 13:59

Shayper said:
Well I love living here. It's the perfect place for either of the career paths I can choose from.

+1. Love it here.

ltnmzh · 28 Jun 2012 at 14:16

Rids said:
Genuinely interested in seeing how they managed to manipulate the LIBOR rate.

It's decided on a round table by a few guys from the major banks.
You can imagine what would happen on the meetings (and off the meetings)

Pudney · 28 Jun 2012 at 14:18

MooMoo444 said:
Wouldn't mind some money back.

=D

I've heard some indications that they kept LIBOR lower than they should. Which means you probably paid too little. So you in fact owe them.

iamtheoneneo · 28 Jun 2012 at 14:27

so they did us a favour? im down with that.

MooMoo444 · 28 Jun 2012 at 14:30

Pudney said:
I've heard some indications that they kept LIBOR lower than they should. Which means you probably paid too little. So you in fact owe them.

Well for us who are kinda clueless about thing, how does us paying less make the banks figures look better in the long run?

Pudney · 28 Jun 2012 at 14:31

MooMoo444 said:
Well for us who are kinda clueless about thing, how does us paying less make the banks figures look better in the long run?

Because the banks pay less too on their debts. And their debts are just a tad larger than yours.

MooMoo444 · 28 Jun 2012 at 14:34

I see. Could do with it going lower then.

Greebo · 28 Jun 2012 at 15:14

MooMoo444 said:
Well for us who are kinda clueless about thing, how does us paying less make the banks figures look better in the long run?

From what I gather it went like this.

Lehman brothers **** hit the fan in 2008

Cost of borrowing between banks rocketed (which is pretty much what the LIBOR rate is although is used in loans to none banks)

Banks obliged to report the Libor rate that they are borrowing money at.

Cue large banks (and note the plural) lying about the LIBOR rate in order to

1. Drive the LIBOR rate down eg say it's really 5% but most of the big banks report it as 4%. When they are next going to market to borrow money at LIBOR rate, they'll say "lend it to us at LIBOR which is 4% and nationally reported" which means they get there money cheaper.

2. Make them look more financially secure during the banking crysis than what they really are eg if a bank shows it owes £100 billion at 8% is in a much worse state than a bank which owes it at 5%.

Duke · 11 Jul 2012 at 15:08

http://www.accountingdegree.net/numbers/libor.php - helps explain it a little bit

estebanrey · 11 Jul 2012 at 15:11

Greebo said:
2. Make them look more financially secure during the banking crysis than what they really are eg if a bank shows it owes £100 billion at 8% is in a much worse state than a bank which owes it at 5%.

Greebo · 11 Jul 2012 at 15:21

estebanrey said:

crinkleshoes · 11 Jul 2012 at 15:54

Greebo said:
1. Drive the LIBOR rate down eg say it's really 5% but most of the big banks report it as 4%. When they are next going to market to borrow money at LIBOR rate, they'll say "lend it to us at LIBOR which is 4% and nationally reported" which means they get there money cheaper.

Is this not good for the consumer, though?

Greebo · 11 Jul 2012 at 16:10

crinkleshoes said:
Is this not good for the consumer, though?

Depends if you are a borrower or lender?

Technically, it might mean slightly cheaper mortgage rates but equally can also mean less interest paid to savers.

So depends which side of the fence you are on.

crinkleshoes · 11 Jul 2012 at 16:45

So basically good for those without money, bad for those with...

I think those without probably outnumbers those with, so in general - a bit better for the consumer.

Therefore... I'm suddenly angered by the fine and wish their manipulation of the market to continue!

lol... point is, I don't care about what they do as long as it has no negative effect on the majority.

Greebo · 11 Jul 2012 at 16:49

Problem is that it's lying and manipulating the market.

Where do you stop?

Who decides how far they go and what they manipulate?

Slippery slope if you just say banks can do whatever they want as it helps the majority.

crinkleshoes · 11 Jul 2012 at 16:55

If it truly does help the majority though, then where's the issue.

I can imagine regulating such a manipulated market would be near impossible... so only really do-able in some mythical ideal scenario, of course.

Greebo · 11 Jul 2012 at 17:29

Not sure I am so happy with that idea though. You could argue that if you gave a bank that power to lie then they might decide it's better to lie in order to make more money as in the long run, a bank with lots of money means lower costs of borrowing for the majority. I think I would rather have it that it's regulated .