Six Weeks To SaveThe Euro ..

[miktay]

Question Mik:

What do you think the effect would be on the hedge funds if something definite comes out of this EU summit?

As far as I could see, a helluva lot of money is riding on a Greek decision one way or the other. Same for Spain and Italy.

OE:

When yuh say 'definite' u will have 2b mo specific.

Specifics usually begin with a vowel. Usually the letter E.

ECB? Eurobonds? EFSF? EFSM? ESM? ELA? EIB? IMF?

[miktay]

Mo trouble in paradise.

The Futility of European Elections

Europe and the financial markets watched intently June 17 as Greece held general elections. German Chancellor Angela Merkel, French President Francois Hollande and Italian Prime Minister Mario Monti all delayed their flights to the June 18 G-20 summit in Mexico to await the results.

The two leading contenders in the elections were the center-right New Democracy Party (ND), which pledged to uphold Greece's commitments to austerity and honor the country's financial agreements with the European Union and the International Monetary Fund, and the Coalition of the Radical Left (SYRIZA), a group of far-left politicians who pledged to reject Greece's existing agreements, end austerity and maintain the country's position in the eurozone. A third major party, the center-left Panhellenic Socialist Movement (PASOK), shares the ND's position of maintaining Greece's bailout agreement. PASOK had been Greece's ruling party until it formed a unity government with the ND late in 2011.

For a while it seemed these elections would be definitive. Either Greece would reject the country's agreement with its international lenders, potentially being forced out of the eurozone, or it wouldn't. If Greece rejected austerity and forcibly or voluntarily left the eurozone, the country might set a precedent for other troubled states and precipitate a financial crisis -- a eurozone exit and default would likely go hand in hand. Europe would be tested as never before, and it would find out how resilient it is to a wider financial crisis.

But in Europe, the least likely outcome is a definitive one. ND won the election with about 29.5 percent of the vote, earning 78 seats in parliament plus another 50 seats awarded to the winning party by the Greek Constitution. SYRIZA received roughly 27.1 percent of the vote, equivalent to 72 seats, and PASOK received roughly 12.2 percent of the vote, or about 33 seats. The rest of the vote was scattered among a host of other parties. A party needs 151 seats to gain an absolute majority in parliament, but since no single party passed that threshold, a governing coalition must be formed. So the ND needs PASOK if it is going to cobble together a governing coalition, but PASOK has said it will not join a coalition without SYRIZA. It is unclear what a coalition would look like between a party that wants to respect the bailout agreement and a party that wants to reject it, but such a coalition is unlikely to happen anyway. SYRIZA wants to form a powerful opposition. Something resembling a government eventually will be assembled regardless of current rhetoric.

The Greek vote has settled nothing. In fact, it may not even lead to the formation of a government; the last election failed to produce a government and forced this election. That the European crisis most severely affected a country so politically fractious could be seen as pitiable. On the other hand, one could argue that the crisis inevitably would be most severe in the most divided country -- not because the divisions caused the crisis, but because the crisis caused the divisions.*

The pressure brought on by the circumstances in Greece undermined whatever political order was in place; the choices for policymakers were so limited and so frightening that coherent responses were difficult. Greece has options, but it is unable to choose one. More than anything, Europe wants a decision on its future, whatever that decision might be. On June 17, Greece disappointed Europe not because of the choice it made but because it was crippled with indecision.

Crisis Management

Greece's indecisions are at the ground level of Europe. Another and more significant framework for indecision is emerging in Franco-German relations. The French Socialist Party won an absolute majority the same day that the Greeks entered another gridlock. This makes it possible for France's Socialists to form a government without the Greens, giving Hollande a strong and coherent platform from which to operate.

France's position on managing the sovereign debt crisis differs fundamentally from Germany's. Germany has said it will not agree to proposed solutions that would essentially turn the eurozone into a transfer union until the rest of Europe can balance their budgets through austerity measures. Germany believes this must be the first step to further EU and eurozone integration. Hollande takes a different position. He, too, wants greater European and eurozone integration. However, Hollande advocates economic stimulus alongside austerity measures as a means to rebalance the finances of European governments.

Hollande wants to grow Europe out of its financial problems. This means stimulating economies, a process that requires deficit spending. Hollande upholds a traditional Keynesian tenet that increasing demand for goods among consumers will increase economic activity and increase investment. As a Socialist with a strong leftist contingent in his party, Hollande cannot support the German position, which constrains the economy, particularly by decreasing government expenditures, thereby depressing consumption.*

The difference between the French and German approaches is substantial. It reveals a dispute at the heart of the European strategy for managing the crisis. The Germans have been aggressive in demanding balanced budgets. The French are becoming equally aggressive in demanding expansionary policies. Both want to avoid defaults, but the Germans want to guarantee payments of debt by a combination of bailout and austerity. The French want to add stimulus to this, which changes the situation entirely because the stimulus would be funded in large part by German coffers.*

This is not a simple matter of divergent economic theory. It is a matter of national interest. France is not as economically decrepit as Spain or Italy, let alone Greece, but nonetheless it is feeling the pressures of the financial crisis. If Europe continues on its path toward recession, France will face higher unemployment and therefore domestic political pressure under the German plan. It is not in Hollande's or France's interests to follow the German course. For its part, Germany cannot risk further government deficits in the European economic system. Germany's robust economy gives the country a financial cushion to soften the effects of deficit cuts; the rest of Europe, including France, does not have this luxury.

Interestingly, France and Germany were as one on this issue until Hollande was elected president. Indeed, the foundation and mission of European integration has been the close alignment of Germany and France. A founding principle of the union, such an alignment guaranteed stability and discouraged conflicts that had torn Europe apart. Now, Europe has lost its coherence at the highest level, albeit in a more orderly manner than in Greece.

http://www.stratfor.com/weekly/futil...pean-elections

[oecarb]

Mo trouble in paradise.


http://www.stratfor.com/weekly/futil...pean-elections

Sigh...........

More expert opinions on Europe from across the Atlantic.

And like the pease porridge - nine days old.

[miktay]

OE:

You sure u want 2 back thiz horse breds?

4 what itz worth tiza sad day when unelected establishment puppets taunt the ostensible German financiers of the EZ experiment.

And another thing. It shows the growing discord between those who earn and save vs those who spend and beg.

Pressure does buss pipe.

Debt crisis: Germany caves in over bond buying, bank aid after Italy and Spain threaten to block 'everything'

On Thursday night, Italy and Spain plunged an EU summit into disarray by threatening to block “everything” unless Germany and other eurozone countries backed their demands for help.

Mario Monti, the Italian Prime Minister, celebrated the agreement, reached in the early hours of Friday, as a “very important deal for the future of the EU and the eurozone”.

He could not resist reminding Angela Merkel, the German Chancellor, that Italy had also won on the football pitch, by defeating Germany two goals to one for a place in the finals of the European Championship.

“It is a double satisfaction for Italy,” he said.

http://www.telegraph.co.uk/finance/f...verything.html

[oecarb]

OE:

You sure u want 2 back thiz horse breds?

4 what itz worth tiza sad day when unelected establishment puppets taunt the ostensible German financiers of the EZ experiment.

And another thing. It shows the growing discord between those who earn and save vs those who spend and beg.

Pressure does buss pipe.

Look Mik,

It is simple.

If you studied how empires get rich and powerful, you would find that the empire "helps" colonies by giving them money so they can buy goods and services provided by the empire. This puts the colonies in debt and enriches the empire which directs the way the money is spent and also collects taxes.

The British Empire did it. Now British people can't understand why the British govt gives overseas aid to poor African and Caribbean countries.

1. Germany has benefitted most from the euro (loans to countries to buy German goods, for instance)
2. Germany has a lot to lose if the euro collapses. Poor countries won't be able to afford German goods.
3. Merkel knows this. Hollande, Monti and Rajoy know this.
4. Merkel has an election coming up.
5. Merkel is not sure if the German people understand 1 and 2 above.
6. Merkel wants a fully integrated Europe. She has said so. (See above on empires)
7. Merkel is willing to help out if the indebted countries surrender their sovereignty - ie become colonies.
8. That way Germany/Europe can control how aid/loans is spent.

So, if you think Merkel chupid and weak and the poor German people going to suffer, check out how she going to sell this idea to the German people and check if she win elections when Germany start to prosper even more.

[miktay]

Look Mik,

It is simple.

If you studied how empires get rich and powerful, you would find that the empire "helps" colonies by giving them money so they can buy goods and services provided by the empire. This puts the colonies in debt and enriches the empire which directs the way the money is spent and also collects taxes.

The British Empire did it. Now British people can't understand why the British govt gives overseas aid to poor African and Caribbean countries.

1. Germany has benefitted most from the euro (loans to countries to buy German goods, for instance)
2. Germany has a lot to lose if the euro collapses. Poor countries won't be able to afford German goods.
3. Merkel knows this. Hollande, Monti and Rajoy know this.
4. Merkel has an election coming up.
5. Merkel is not sure if the German people understand 1 and 2 above.
6. Merkel wants a fully integrated Europe. She has said so. (See above on empires)
7. Merkel is willing to help out if the indebted countries surrender their sovereignty - ie become colonies.
8. That way Germany/Europe can control how aid/loans is spent.

So, if you think Merkel chupid and weak and the poor German people going to suffer, check out how she going to sell this idea to the German people and check if she win elections when Germany start to prosper even more.

Interesting OE. I have heard of empire building.

Greece, Rome, Spain, France, Germany, Japan & Britain controlled large empires at one time.

All the above empires had one essential commonality. They possessed a robust military. Imperialists project military force 2 police the empire. Itz big stick. When building empires u need 2 put a bit of stick about 2 keep colonies in line.

Nowadays Germany does not control a strong military.

If Merkel attempts 2 forge an empire...without a potent military force...she will surely fail.

[oecarb]

Interesting OE. I have heard of empire building.

Greece, Rome, Spain, France, Germany, Japan & Britain controlled large empires at one time.

All the above empires had one essential commonality. They possessed a robust military. Imperialists project military force 2 police the empire. Itz big stick. When building empires u need 2 put a bit of stick about 2 keep colonies in line.

Nowadays Germany does not control a strong military.

If Merkel attempts 2 forge an empire...without a potent military force...she will surely fail.

Mik,

I repeat my post #585 above:

OE: We will soon see what Merkel iz made of.

Merkel done say what she want if we want German money:

'More Europe!': Germany's battle-cry for the eurozone
22 June 2012 Last updated at 16:49 GMT

It is the rallying cry of Germany's Chancellor Angela Merkel as she points to what she thinks is the way out of the euro mire.

"More Europe means that we must give up more powers to Europe," Mrs Merkel says.

....A picture of the German conception of Europe's future is emerging from the utterances of the German foreign minister, Guido Westerwelle, and through the newly published interim report of what is known as the Future Group, which he set up.

The proposals are:

• More European power to determine the economic and tax policies of the member states. There should be a "transfer of sovereignty" to the European centre

• A strengthening of the EU's "foreign office", with a common European foreign and security policy

• A smaller European Commission able to make decisions faster

• A bigger role for the European Parliament to make "stronger democratic legitimacy"

• A directly elected President of Europe

• A European army

So is it a USE - a United States of Europe? There are certainly similarities with the USA - with its central power over economics and common foreign policy.

http://www.bbc.co.uk/news/world-europe-18557059

[oecarb]

Of course, as I have said repeatedly, the European Way is to give the exploited a few crumbs so they are grateful.

[miktay]

A European army

Thiz appears 2b consistent with the likely unfolding of events.

Mr. Farange and Mrs.Thatcher are correct. The common European currency iz nothing more than a sham used 2 subjugate 500 million people.

Baroso, Monti and Merkel are the front 4a gang of neo-communist nationalists diguised in democratic Socialist clothing.

[oecarb]

Thiz appears 2b consistent with the likely unfolding of events.

Mr. Farange and Mrs.Thatcher are correct. The common European currency iz nothing more than a sham used 2 subjugate 500 million people.

Baroso, Monti and Merkel are the front 4a gang of neo-communist nationalists diguised in democratic Socialist clothing.

Mik.

The essential difference between US capitalism and European democratic socialism IMO is that under one system, the oligarchs try to grab everything while, under the other, the exploited are sweetened with benefits, cash, jobs, health care etc - whatever minimum it takes to keep them on side.

And remember - someone on benefits has buying power too.

I know which system I feel safer under.

[miktay]

Mik.

The essential difference between US capitalism and European democratic socialism IMO is that under one system, the oligarchs try to grab everything while, under the other, the exploited are sweetened with benefits, cash, jobs, health care etc - whatever minimum it takes to keep them on side.

And remember - someone on benefits has buying power too.

I know which system I feel safer under.

OE:

They're no real differences b/t either of these systems.

The 'benefits' offered under (so called) EZ democratic Socialism are a modern day equivalent of shiny fashy beads used 2 attract the unwitting population. Once attracted they are ensnared.

Whilst (so called) US capitalism effectively moves toward Socialism with each passing day.

Different systems. Same effect. The Welfare State grows larger.

Softly Softly Catchlee Monkey.

[oecarb]

OE:

They're no real differences b/t either of these systems.

The 'benefits' offered under (so called) EZ democratic Socialism are a modern day equivalent of shiny fashy beads used 2 attract the unwitting population. Once attracted they are ensnared.

Whilst (so called) US capitalism effectively moves toward Socialism with each passing day.

Different systems. Same effect. The Welfare State grows larger.

Softly Softly Catchlee Monkey.

Now, Mik

Do you still think the euro will collapse?

[miktay]

Now, Mik

Do you still think the euro will collapse?

Don't recall writing the Euro wud collapse. Depreciate yes. But collapse iz 2 strong a word.

The Euro iz untenable. As are all fiat currencies.

Fiat currency izan establishment tool 4 subjugation. And it iz working. Most major countries are insolvent. Where will they get the money 2 re-capitalize the banking sectors?

Wealth iz surreptitiously being transferred fm the people 2 the establishment using fiat currency.

And obviously I have a vested interest in trying 2 mitigate thiz theft.

Cuz yuh see I am one of the people.

[oecarb]

Don't recall writing the Euro wud collapse. Depreciate yes. But collapse iz 2 strong a word.

The Euro iz untenable. As are all fiat currencies.

Fiat currency izan establishment tool 4 subjugation. And it iz working. Most major countries are insolvent. Where will they get the money 2 re-capitalize the banking sectors?

Wealth iz surreptitiously being transferred fm the people 2 the establishment using fiat currency.

And obviously I have a vested interest in trying 2 mitigate thiz theft.

Cuz yuh see I am one of the people.

I asked the question because of the title of the thread.

I agree that wealth is sometimes surreptitiously transferred using fiat currency but I can see fiat currencies continuing to be useful snd convenient as metrics to measure production of goods and services. After all, in all my working life I have been paid in fiat currencies, paid taxes in fiat currencies, educated, fed and clothed kids using fiat currencies and I have acquired some real possessions.

However, I cannot understand how most derivatives can be tenable and that is where IMO the next big bubble is.

[miktay]

I I agree that wealth is sometimes surreptitiously transferred using fiat currency but I can see fiat currencies continuing to be useful snd convenient as metrics to measure production of goods and services. After all, in all my working life I have been paid in fiat currencies, paid taxes in fiat currencies, educated, fed and clothed kids using fiat currencies and I have acquired some real possessions.

Money iz essential 2 the modern economy. Without a common means of exchange productivity would decline exponentially. There would not be the variety quality & availability of goods and services that we enjoy today.

I do no agree that money should be fiat paper. Fiat paper requires that we trust 2 a central authority who decrees the means of exchange.

The State has mandated citizens 2 use Central Bank notes as legal tender. Thiz iz coercion. Thiz iz not a free market.

However, I cannot understand how most derivatives can be tenable and that is where IMO the next big bubble is.

Statist promises of safety, security and justice are not real. There are at least 1 quadrillion reasons why we should be skeptical of central control.

[oecarb]

Money iz essential 2 the modern economy. Without a common means of exchange productivity would decline exponentially. There would not be the variety quality & availability of goods and services that we enjoy today.

I do no agree that money should be fiat paper. Fiat paper requires that we trust 2 a central authority who decrees the means of exchange.

The State has mandated citizens 2 use Central Bank notes as legal tender. Thiz iz coercion. Thiz iz not a free market.



Statist promises of safety, security and justice are not real. There are at least 1 quadrillion reasons why we should be skeptical of central control.

Mik,

1. What would you recommend that we use as money? Especially as you say the price of gold can be manipulated.

2. What has statist control have to do with derivatives which are even further removed from reality than fiat currency IMO?

[miktay]

Mik,

1. What would you recommend that we use as money? Especially as you say the price of gold can be manipulated.

2. What has statist control have to do with derivatives which are even further removed from reality than fiat currency IMO?

OE: the price of gold iz manipulated because of the existence of the banking Cartel. A Cartel exists because the State has enacted regulations 2 restrict easy entrant 2 the banking sector.

I would prefer a free market gold or silver standard with 100% reserve banks.

Statists have promised regulation 2 control the banking sector. That the banking sector has accumulated quadrillions in claims indicates that banking iz shrewder than the State.

And why shouldnt bankers be more motivated than State bureaucrats? They're better paid...better educated..better connected than bureaucrats.

Thiz iz the fallacy of central control. A central authority of a few hundred thousand cannot effectively manage the lives of millions. Even with the best intentions thiz iz impractical.*

Thiz iz the illusion of the nanny state.*

[oecarb]

OE: the price of gold iz manipulated because of the existence of the banking Cartel. A Cartel exists because the State has enacted regulations 2 restrict easy entrant 2 the banking sector.

I would prefer a free market gold or silver standard with 100% reserve banks.

Statists have promised regulation 2 control the banking sector. That the banking sector has accumulated quadrillions in claims indicates that banking iz shrewder than the State.

And why shouldnt bankers be more motivated than State bureaucrats? They're better paid...better educated..better connected than bureaucrats.

Thiz iz the fallacy of central control. A central authority of a few hundred thousand cannot effectively manage the lives of millions. Even with the best intentions thiz iz impractical.*

Thiz iz the illusion of the nanny state.*

So, Mik:

We have very powerful bankers controlling quadrillions of largely notional money and manipulating the "price" of gold (which, you say is real money).

This is the status quo.

Now, where do we go from here?

How do we achieve your goal of a free market gold or silver standard with 100% reserve banks?

Will the bankers volunteer to move to this system?

[miktay]

So, Mik:

We have very powerful bankers controlling quadrillions of largely notional money and manipulating the "price" of gold (which, you say is real money).

This is the status quo.

Now, where do we go from here?

How do we achieve your goal of a free market gold or silver standard with 100% reserve banks?

Will the bankers volunteer to move to this system?

Oe:

Banks & their owners cannot be reformed.

That they control instruments valued in quadrillions implies they're above the law. And they're above the States that claim 2 regulate them.

The way forward iz a complete breakdown of the current system.

After thiz perhaps gold and silver and 100% reserve banking will become the standard.

Until then it iz likely we will see more banking scandals that...somehow...always escape regulators.

Case in point. The Barclays LIBOR scandal. Barclays has admitted rigging the LIBOR market. And in the middle of the embroglio we find none other than a Mr. Paul Tucker.

If u recall Mr. Paul Tucker iz the Deputy Guv'nor of the parliamentary 'controlled' entity known as the Bank of England.

Politics: Why is Nobody Freaking Out About the LIBOR Banking Scandal?
BY MATT TAIBBI
JULY 3, 2012 | 9:04AM EDT

The LIBOR manipulation story, appropriately, has exploded into a major scandal overseas. The CEO of Barclays, Bob Diamond, has resigned in disgrace; his was the first of what will undoubtedly be many major banks to walk the regulatory plank for fixing the interbank exchange rate. The Labor party is demanding a sweeping criminal investigation. Mervyn King, Governor of the Bank of England, responded the way a real public official should (i.e. not like Ben Bernanke), blasting the banks:

It is time to do something about the banking system…Many people in the banking industry are hardworking and feel badly let down by some of their colleagues and leaders. It goes to the culture and the structure of banks: the excessive compensation, the shoddy treatment of customers, the deceitful manipulation of a key interest rate, and today, news of yet another mis-selling scandal.

All of England is in a furor about the revelations that Barclays, the Royal Bank of Scotland, and other banks were involved monkeying with at least $10 trillion in loans (The Wall Street Journal is calculating that that LIBOR affects $800 trillion worth of contracts). The banks gamed LIBOR for two semi-overlapping reasons.

As noted here last week, there were instances of Barclays traders badgering the LIBOR submitters to "push down" rates in order to fatten their immediate bottom lines, depending on what they were trading or holding that day. They also apparently rigged LIBOR downward in order to produce a general appearance of better health, essentially tweaking their credit scores a few ticks upward.

Most intriguingly, or perhaps disturbingly, there were revelations last week that Bank of England deputy Governor Paul Tucker had a conversation with Diamond at the peak of the crisis in 2008, a conversation that left Diamond, and subsequently his traders, with the impression that the bank had carte blanche to rig LIBOR downward in order to help allay spiraling public fears about the banks' poor financial health.

British officials, and Tucker individually, deny that Tucker gave Diamond permission to rig rates, but a report by British regulators did conclude that the two were talking about Barclays LIBOR submissions on October 29, 2008, and that as a result of that conversation, Diamond came away with a "misunderstanding.

" The Daily Mail quotes the Financial Services Authority report:

However, as the substance of the telephone conversation was relayed down the chain of command at Barclays, a misunderstanding or miscommunication occurred.

This meant that Barclays' submitters believed mistakenly that they were operating under an instruction from the Bank of England (as conveyed by senior management) to reduce Barclays' Libor submissions.

That is explosive stuff. Members of Parliament will be grilling Tucker tomorrow about those events in what is sure to be a far more combative and entertaining legislative inquiry than the Jamie Dimon dog-and-pony show we just went through here in the states in recent weeks.

The implications of that part of the story should be particularly interesting to Americans, who in recent years have been party to a number of revelations about strange and seemingly inappropriate contacts between senior regulatory officials and big bankers during the heat of the crisis.

We know that American officials were extremely concerned about the appearance of weakness in the financial markets, so much so that they may have resisted pursuing criminal prosecutions against big banks, and we also know that they spent a lot of time commiserating with Wall Street figures before and during the crisis.

If Bob Diamond and Paul Tucker were having these talks about LIBOR, is it fair to wonder what Hank Paulson and Lloyd Blankfein were talking about in the 24 discussions they had in the six days following the AIG disaster? When he had a secret meeting with the entire board of Goldman Sachs in, of all places, his hotel suite in Moscow, in June of 2008? Or what other material nonpublic information was exchanged when Paulson met with a gang of hedge fund chiefs at the offices of Eton Park management in July 2008, and laid out for them a possible scenario for putting Fannie and Freddie into receivership?

Anyway, the LIBOR story is leading the front pages of most of Britain's dailies, it's on TV, and it's producing blistering editorials and howls of outrage amongst politicians and activists.

The big story on our shores in the last few weeks has been the health care ruling, which makes sense, but then after that… what? The heat? Tom and Katie? (There's actually a story about how Katie can wear heels again, now that she's not married to a short person). Joe Sandusky? Nightline's big story tonight, which is already being hyped on the net, is about how fat Chris Christie is and why the hell he hasn't done the bypass surgery yet:

New Jersey Gov. Chris Christie opened up about his weight problem in an interview with ABC News and stressed he is "trying" to lose weight, a battle he's waged for 30 years, but said he's never considered gastric bypass surgery because it's "too risky."

"I mean, see, listen, I think there's a fundamental misunderstanding among people regarding weight and regarding all those things that go into, to people being overweight," Christie said in an interview that will air Tuesday on "Nightline."

The New York Times did chime in with a house editorial yesterday, and it was appropriately somber. And there has been some coverage in the financial press.

But to me what's missing from all of this is the "Holy ****ing ****!" factor. This story is so outrageous that it shocks even the most cynical Wall Street observers. I have a friend who works on Wall Street who for years has been trolling through the stream of financial corruption stories with bemusement, darkly enjoying the spectacle as though the whole post-crisis news arc has been like one long, beautifully-acted, intensely believable sequel to Goodfellas. But even he is just stunned to the point of near-speechlessness by the LIBOR thing. "It's like finding out that the whole world is on quicksand," he says.

Anyway, as far as the stateside press goes, I've got to assume the cavalry is coming soon, but when?

http://m.rollingstone.com/entry/view/id/29118/pn/all/p/0/?KSID=77686684de512b95c3516b3e59f51ad2

[oecarb]

Oe:

Banks & their owners cannot be reformed.

That they control instruments valued in quadrillions implies they're above the law. And they're above the States that claim 2 regulate them.

The way forward iz a complete breakdown of the current system.

After thiz perhaps gold and silver and 100% reserve banking will become the standard.

Until then it iz likely we will see more banking scandals that...somehow...always escape regulators.

Case in point. The Barclays LIBOR scandal. Barclays has admitted rigging the LIBOR market. And in the middle of the embroglio we find none other than a Mr. Paul Tucker.

If u recall Mr. Paul Tucker iz the Deputy Guv'nor of the parliamentary 'controlled' entity known as the Bank of England.



http://m.rollingstone.com/entry/view...516b3e59f51ad2

Mik,

This bit is very important:

British officials, and Tucker individually, deny that Tucker gave Diamond permission to rig rates, but a report by British regulators did conclude that the two were talking about Barclays LIBOR submissions on October 29, 2008, and that as a result of that conversation, Diamond came away with a "misunderstanding.

" The Daily Mail quotes the Financial Services Authority report:

However, as the substance of the telephone conversation was relayed down the chain of command at Barclays, a misunderstanding or miscommunication occurred.

This meant that Barclays' submitters believed mistakenly that they were operating under an instruction from the Bank of England (as conveyed by senior management) to reduce Barclays' Libor submissions.

Tucker will be questioned by MPs (televised live) and he will give his side of the story.

However, it seems to me that if I say to you "Mik, your income is a bit low" and you then started lying about how much you earn - even when you apply for a loan - you can't blame me if you are charged with fraud.

[miktay]

Mik,

This bit is very important:

Tucker will be questioned by MPs (televised live) and he will give his side of the story.

However, it seems to me that if I say to you "Mik, your income is a bit low" and you then started lying about how much you earn - even when you apply for a loan - you can't blame me if you are charged with fraud.

Oe:

Mr. Diamond 'mistakenly' believed Mr. Tucker implied that Barclays rate wuz 2 hi.

Mr. Diamond 'mistakenly' passed down the instruction 2 his right hand man Mr. Del Messier.

Mr. Del Messier 'mistakenly' instructed hiz traders 2 fiddle the rates.

That's a lot of 'mistakes' 4 such highly paid bunch.

Curiously neither Mr. Tucker nor Mr. Diamond appears 2 have taken any action 2 correct these 'mistakes'.

It reminds one of the CLICO debacle.

Trini financial titians aren't the only ones who make 'mistakes' that have such pointed financial repercussions.

[lexbarker]

How does modern day bankers compare with the ones of the past?

[oecarb]

Oe:

Mr. Diamond 'mistakenly' believed Mr. Tucker implied that Barclays rate wuz 2 hi.

Mr. Diamond 'mistakenly' passed down the instruction 2 his right hand man Mr. Del Messier.

Mr. Del Messier 'mistakenly' instructed hiz traders 2 fiddle the rates.

That's a lot of 'mistakes' 4 such highly paid bunch.

Curiously neither Mr. Tucker nor Mr. Diamond appears 2 have taken any action 2 correct these 'mistakes'.

It reminds one of the CLICO debacle.

Trini financial titians aren't the only ones who make 'mistakes' that have such pointed financial repercussions.

Mik,

Speaking as one who has lived on this side of the Atlantic for decades and having watched hundreds of American films and spoken to many Americans, I can say definitely that Bernard Shaw was right when he said:

"America and Britain are two countries separated by a common language."

We don't know exactly how Bernanke and Geithner and Paulson commmunicate but we do know that Diamond is American and he might have used (or found useful) the American interpretation. We will have to wait for further investigation:

BTW we don't have plea bargaining or concessions for cooperating with the authorities over here.

Serious Fraud Office launches Libor investigation

The Serious Fraud Office (SFO) has confirmed that it has formally launched an investigation into the rigging of inter-bank lending rates.

The case could lead to criminal charges being brought against individuals.

Its involvement follows an investigation by US and UK regulators into the manipulation of Libor, which resulted in a record fine for Barclays.

The Chief Secretary to the Treasury, Danny Alexander, said he was "delighted" by the decision.
"As a government, we will make sure the SFO has all the resources it needs to conduct this investigation in full," he said.

"I want the SFO to follow the evidence wherever it goes, to bring prosecutions if they can."

Last week the bank agreed to pay £290m in penalties after its traders tried to rig inter-bank lending rates, sometimes working with staff at other financial institutions.

Regulators are continuing to look into possible rate manipulation at other banks, while the US Department of Justice is carrying out its own criminal investigations.

An SFO spokesperson confirmed that a dedicated case team had now started work, but would not say whom it was investigating.

Its short statement said only: "The SFO Director David Green QC has today decided formally to accept the Libor matter for investigation."

The Libor affair, described by the prime minister as a scandal, has led to the resignation of three of Barclays' most senior executives in a matter of days, including chief executive Bob Diamond.

He appeared before MPs on the Treasury Select Committee this week, when he called the behaviour of those responsible for Libor rigging at the bank "reprehensible".

Regulators in the UK and the US found that Barclays staff had tried to affect rates over a number of years, first for profit and then to reduce concerns about how much it was being affected by the financial crisis.

The SFO is responsible for investigating allegations of serious and complex frauds. It considers whether to prosecute using a number of criteria, including whether it is a matter of public concern, and whether the value of any fraud is more than £1m.

The government agency said a few days ago that it was considering whether a criminal prosecution was appropriate and possible, and said this could take a month.

"Normally when there is such a public outcry, the law enforcement agencies manage to act in a more accelerated pace," said Bradley Simon, a former US federal prosecutor who now defends clients in fraud cases.

He said the SFO would be sensitive to criticism that it had been slow to respond in the past.

"They have to show they are on top of this. There are a lot of angry people out there," he told BBC News.

http://www.bbc.co.uk/news/business-18742140

[oecarb]

How does modern day bankers compare with the ones of the past

Interesting, Lex.

BTW when the chap said that to insult someone, you call him a BANKER.

I don't know if you know that this is known as "Cockney rhyming slang" and the real meaning is a word that rhymes with banker.

[oecarb]

Also

In 2007, as the financial crisis was gathering steam, banks also began submitting false Libor rates for a different reason. Libor, you may recall, was a measure that gave the outside world a sense of how much trouble the banks were in; the higher the rate required to borrow, the worse shape they were assumed to be in. So Barclays — with what appears to be the complicity of British bank regulators — started submitting rates that were lower than the reality. Its executives said the purpose was to keep Barclays from “sticking its head above the parapet.”

Even now, Barclays justifies the latter rationale as being a kind of emergency measure brought on by the financial crisis. But the bank is wrong about this. Submitting false data, for whatever reason, is a violation of the law — not to mention a fundamental abuse of trust. Once again, it leads one to believe that bankers feel neither the constraints of the law nor of morality.

Which brings me to the second big surprise. Britain and America have reacted to the Libor scandal in completely different ways. Britain is in an utter frenzy over it, with wall-to-wall coverage, and the most respectable, pro-business publications expressing outrage. Yes, Barclays is a British bank, and the first word in Libor is “London.” But still: The Economist ran a headline about the scandal that read, in its entirety, “Banksters.”

Yet, on these shores, the reaction has been mainly a shrug. Perhaps we’re suffering from bank-scandal fatigue, having lived through Bank of America’s various travails, and the Goldman Sachs revelations, and, most recently, the big JPMorgan Chase trading loss. Or maybe Libor is just hard to gets one’s head around.

But the Brits have this one right. They may not understand the intricacies of Libor any better than we do, but they sense, powerfully, that banks have once again made a mockery of the role that society entrusts to them.

http://www.nytimes.com/2012/07/07/op...it_th_20120707

When did the alleged conversations with Tucker take place?