Fed knew about Libor rigging in 2008 Senior Fed official first flagged Libor issue at a policy meeting in April 2008, newly released documents reveal
The US Federal Reserve knew about Libor rigging three years before the financial scandal exploded but did not take any firm action, documents have revealed.
According to newly published transcripts of the central bank’s meetings in the run-up to and immediate aftermath of the collapse of Lehman Brothers, a senior Fed official first flagged the issue at a policy meeting in April 2008.
William Dudley expressed fears that banks were being dishonest in the way they were calculating the London interbank offered rate – a global benchmark interest rate used as the basis for trillions of pounds of loans and financial contracts.
“There is considerable evidence that the official Libor fixing understates the rates paid by many banks for funding,” he said.
The transcript of the Fed’s April 2008 meeting raises questions about why the central bank did not move to properly tackle the scandal. There was no official regulator for Libor at the time, and officials at the US Federal Reserve tried to blame British authorities for allowing the benchmark interest rate to get out of control in the first place.
Answer: which one? Actually, it doesn't matter helicopter...my answer is no.
ReplyDeleteFed knew about Libor rigging in 2008
ReplyDeleteSenior Fed official first flagged Libor issue at a policy meeting in April 2008, newly released documents reveal
The US Federal Reserve knew about Libor rigging three years before the financial scandal exploded but did not take any firm action, documents have revealed.
According to newly published transcripts of the central bank’s meetings in the run-up to and immediate aftermath of the collapse of Lehman Brothers, a senior Fed official first flagged the issue at a policy meeting in April 2008.
William Dudley expressed fears that banks were being dishonest in the way they were calculating the London interbank offered rate – a global benchmark interest rate used as the basis for trillions of pounds of loans and financial contracts.
“There is considerable evidence that the official Libor fixing understates the rates paid by many banks for funding,” he said.
The transcript of the Fed’s April 2008 meeting raises questions about why the central bank did not move to properly tackle the scandal. There was no official regulator for Libor at the time, and officials at the US Federal Reserve tried to blame British authorities for allowing the benchmark interest rate to get out of control in the first place.
http://www.telegraph.co.uk/finance/libor-scandal/10654977/Fed-knew-about-Libor-rigging-in-2008.html