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EYE-BALL Guru on – The LIBOR Scandal – Part II …The Banks are in Trouble … again!!!

July 14, 2012
The “LIBOR” Scandal … Part II –
The Banks are in Trouble … again!!!
| Author: EYE-BALL Guru | 13th July 2012 |

Link to Previous Stories on this Subject

The LIBOR scandal continues to spread – Financial Media just can’t get enough and the list of Banks exposed just keeps getting bigger.   This post intends to give you an opportunity to read linked stories from varies news wire services and its continued fallout.   There are other Bank scandal related stories as well and when all said and done – the BANKS are involved in some pretty serious manipulation and corrupted behaviour.

It’s important to get a cross-section of opinions on this story and first off my new favourite source of news and other financial information is the RT source and linked with Julian Assange.

Linked stories from RT TV – [Home page linked here]:

  1. 9th July 2012 – EU commissioner wants to criminalise market abuse
  2. 10th July 2012 – UK fraud buster to investigate Libor affair
  3. 11th July 2012 – Diamond denies misleading the inquiry on Libor case

Related Banking Misconduct issues –

  1. 12th July 2012 – HSBC to pay $1 bln for money laundering
  2. 12th July 2012 – German and French authorities raid Swiss banking majors

Linked stories from REUTERS News Services – [Home page linked here]:

  1. 12th July 2012 – Insight: Fed knew of Libor issue in 2007-08, proposed reforms
  2. 12th July 2012 – Barclays’ Diamond accused of misleading inquiry
  3. 12th July 2012 – Libor scandal may cost banks $14 bln in settlements: analysts
  4. 13th July 2012 – U.S. Senators call for more vigorous Libor probe
  5. 13th July 2012 – Barclays’ Diamond turns to top lawyer for Libor scandal
  6. 13th July 2012 – Geithner pressed British regulators in 2008 on Libor

Related Banking Misconduct issues –

  1. 12th July 2012 – Fed examiner rejig hurt JPMorgan supervision: $5 billion losses exposed
  2. 13th July 2012 – Wells Fargo to pay $175 million in race discrimination probe
  3. 13th July 2012 – U.S. investigates whether JPMorgan traders hid losses

Linked stories from CNBC – Europe News Services – [Home page linked here]:

  1. 11th July 2012 – UK Lawmakers to Grill Barclays Ex-COO, UK Regulator
  2. 12th July 2012 – Banks’ Libor Costs May Hit $22 Billion
  3. 13th July 2012 – How Will the Libor Scandal Affect London?

Related Banking News –

  1. 13th July 2012 – JPMorgan Profit Declines on $4.4 Billion Loss From ‘Whale’

This LIBOR scandal on to of the Eurozone crisis, and thumped again overnight with a further Moody’s downgrading of Italian debt is becoming ore than Governments can cope with.

The ink on printing presses has dried up and Governments have seen that throwing more money at the problems could sink everybody.  Banks involved in these ‘bailout’ packages are nervous lenders and would prefer not to be there at all. Governments hold the leverage in terms of the early GFC bailouts and how long that will remain is shortening by the day.

Whilst Banks remain thankful for the assistance offered by Governments liquidity cost and TARP type funding – the Banks and their corrupt ways are still business as usual in ripping off mortgage borrowers.  The LIBOR rate fixing has fed $10’s of billions into BANK profits over countless years – and that will still be the case going forward.  Whatever fines imposed on the BANKS will come back to them in more ‘bailout’ assistance and it makes it all so insidious and ‘what’s the point’.

Talk is of $12-$14 billion in fines – how will those fines feed their way back to customers who were ripped off?   They won’t and this works the same way as confiscated booty form drug barons and other criminals.   The Regulators will use the fine money to fund their operations.  It’s the ‘sherif’ playing at issuing parking fines and keeping the revenue themselves.

Whilst the public read all this information with mouths agape – those in the know that things will never change.  The Financial system has to completely collapse before any real changes will bare fruit.  Whilst ‘greedy capitalist’ morality continues to occupy Wall Street and the like – the more it will stay the same.  It is impossible to fathom a solution that does not call for a complete overhaul and rebuild of how Banks are licensed and allowed they operate.

A first step would be to force BANK’s to decide whether they wanted to be a retail or wholesale operation.  This has been muted by several Regulators and is being considered but is equally being rejected by Investment Banks Goldman Sachs and JP Morgan.  JP Morgans recent ‘rogue unit’ loses disclosed overnight as being in excess of $5 billion and getting larger by the week – two weeks ago it was less than $2 billion, then $2.5 billion, and now $5.5 billion – to be honest they have some idea and the incremental disclosure is all about containment.

Also, overnight JP Morgan announced strong quarter results of $4.9 billion in profits despite the $5.5 billion in loses.  As stated, it has been a managed media show since the loses were first discovered and done so as protection for the broader market.  What is not known as who sanctioned the cover-up and slow-leak release of the story.   JP Morgan CEO James Dimond who had already fronted Senate Committee hearings has now engaged a high profile lawyer to defend allegations he lied to that Senate Committee.

So the LIBOR scandal is pushed off the front page, but its depth of corruption and collusiveness far outweighs the J Morgan trader loses.  You would think the media would know this – but the investigative intent for a story about the LIBOR scandal not only damages public Media companies with share price respondent falls, but erodes what little confidence speculators and investors have to play a game where they know they’re always gonna get screwed.  It’s more and more like playing at a Casino – the House always win and if they don’t then they change the rules so they will.

The coming weeks and months will see small fry hauled before LIBOR enquiries and a few big-wigs will have their ass’s hung out – but any of the $12 billion or so muted as fines and penalties will be small change for what these Banks are responsible for.


Have your say where it counts: – contact your Local Federal Representative via the links below and let them know how you feel about this, or any other topic that you feel strongly about – or you can just post a comment below and let off some steam.


The EYE-BALL Guru …

  1. chinwag
    July 20, 2012 at 10:31 pm

    What you said made a lot of sense. But, think about this, what if you added a little content? I mean, I dont want to tell you how to run your blog, but what if you added something to maybe get peoples attention? Just like a video or a picture or two to get people excited about what youve got to say. In my opinion, it would make your blog come to life a little bit.

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