Libor stands for London interbank offered
rate. Perhaps not your run of the daily mill word but it helps determine $750
trillion worth of financial products such as mortgages, credit cards, student loans,
and a lot more things the PK likely knows about but I don’t.
At any rate there was a big, really big
scandal about it this year as investigators found big no no’s, criminal no no’s
in Britain and the U.S. manipulating said Libor rates.
Found out, Barclays of Britain agreed to
pay $450 million to settle accusations. And 10 more banks are being looked over
including HSBC, J.P. Morgan, and Citigroup. You can read a lot more about it
from the New York Times.
Now if you are relying on the Telly (much
be the influence of watching the London Olympics) to find out about this big
scandal, you may miss it completely. Following is a chart from Bill Moyer’s
blog on the TV coverage we are receiving.
Makes you wonder doesn’t it?
Well... this one gets understandably low coverage because while it's an important number, it's an obscure topic. I would bet at least 95% of the U.S. hasn't the faintest idea of what LIBOR even is, let alone how it could affect them.
ReplyDeleteSo to cover the topic requires some investment in time educating the viewer first. So I suspect simple media lazyness more than any sort of skullduggery. The subject matter is 'boring', the payoff in ratings is poor, and most still haven't grasped the whole thing about Collateralized Debt Obligations (CDOs) from the crisis 4 years ago.
Egads! I think I get the Lipor bit, but CDOs...I'm sure the Warren and Buffet have a handle on that but I'm struggling. Could you do a piece on it as you do so well boiling it down for lay economists?
ReplyDeleteYou may well be right on Libor, but if I didn't find it that difficult, with a bit of coverage I would think others would as well.
Banks aren't interested in simple savings and checking accounts anymore.
ReplyDelete