Thursday, July 5, 2012

Diamond in the rough

Our Shadow Glass-Steagall Committee awaits the Brit who can cast the first stone over the Atlantic in their Libor teapot tempest;

The Barclays executive said that he was concerned in autumn 2008 that the Government may seek to nationalise the bank if they thought Barclays was struggling to raise money.
At the time, Barclays was declaring a Libor rate higher than other banks – which may have been interpreted that it was in financial difficulty. In fact, Mr Diamond believed this was because other banks were manipulating their rates to be lower.
When asked about the conversation with Mr Tucker, Mr Diamond said that he interpreted it as a warning over the Government’s concerns.
He was then asked about the identities of the “senior figures” referred to by Mr Tucker.
“I would only be speculating and it’s not appropriate to do that,” he said. “Paul [Tucker] didn’t mention who he was referring to. I don’t know, senior people."
....Mr Diamond also added that Barclays had repeatedly warned regulators in Britain and America about the problems with the Libor rate.
“There was an issue out there and it should have been dealt with,” he said. “We were disappointed.”

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