What the Housing Market Actually Looks Like

By: Thursday December 20, 2012 8:30 am

This week brought more good statistical news for the housing market. Existing home sales rose at a decent clip in November, nearing post-bubble highs not seen since the artificial spike from the homebuyer’s tax credit (I’ve noted that the end of the Mortgage Forgiveness Debt Relief Act could be giving the same spike). Inventory fell [...]

UBS Fined $1.5 Billion, Pleads Guilty to Fraud Charge in Libor Case

By: Wednesday December 19, 2012 8:30 am

Swiss bank UBS will pay $1.5 billionfor their role in the Libor rate-rigging scandal. The sum is over three times the fine imposed on Barclays Bank for the same violations. UBS also admitted to one count of wire fraud in its Japanese unit, according to the Justice Department. Much of the rate rigging in the [...]

We Don’t Have a Deficit Problem, Cont’d

By: Monday December 17, 2012 6:59 am

Paul Krugman takes aim at something that should have been a major talking point for progressives, even if lawmakers couldn’t touch it, for the last four years. There has been a void in talking about the budget deficit in real terms, in what it’s composed of and what it really means. First of all, to [...]

Fed, Treasury Refuse to Take Libor Out of TARP Programs

By: Friday October 26, 2012 6:17 am

The Special Inspector General for TARP, Christy Romero, has recommended that the Federal Reserve and the Treasury Department stop using LIBOR, the benchmark interest rate derived in such a slipshod way that it was rigged for years. But the Fed and Treasury aren’t taking Romero up on the request. The Treasury and the Fed should [...]

British Regulators Announce Overhaul of Libor

By: Friday September 28, 2012 10:03 am

The Financial Services Authority, the top regulator of the banking industry in Britain, announced its changes to how the Libor, the benchmark interest rate which undergirds hundreds of trillions of dollars in financial products, will be derived. As expected, the British government will take responsibility for setting the Libor away from the British Bankers’ Association. [...]

British Bankers’ Association Likely to Lose Libor Rate-Setting Responsibility

By: Tuesday September 25, 2012 11:39 am

The British Bankers’ Association, the group that currently sets the Libor, the benchmark interest rate that was manipulated over a long period by bank traders, could lose their control over the rate-setting as early as Friday, according to anonymous sources. The move is likely to be announced on Friday, when Martin Wheatley, managing director of [...]

Worrying About the Next Recession

By: Tuesday September 18, 2012 1:00 pm

As the economic recovery drags on in excruciatingly slow fashion, one thing should concern the country: we’re in no position to handle another economic shock. Just as a family overburdened by mortgage debt would be ill-equipped to withstand an economic blow like sudden unemployment or a medical catastrophe, a country with a too-high unemployment rate [...]

Experts Warned CFTC About Potential Libor Rigging 15 Years Ago

By: Thursday September 6, 2012 10:59 am

The Commodity Futures Trading Commission has led the investigation into the Libor rate-rigging scandal. They have pursued civil charges, and worked with the Justice Department on criminal ones. But when the CFTC first learned about how banks could easily implement rate-rigging, they ignored it – when the agency was under the executive branch of President [...]

Damages From Libor Could Reach Tens of Billions

By: Wednesday September 5, 2012 12:29 pm

Libor has sort of faded into the background as an issue because of the salience of the political campaign, but investors burned by the rate-rigging scandal still see it as a fertile opportunity to collect. That’s probably the extent of the damage that the banks will feel for rigging the benchmark interest rate, but some [...]

Fed’s Preferred Monetary Policy Tool, Quantitative Easing, Mostly Benefits the Rich

By: Friday August 24, 2012 10:53 am

I can think of several ways that the Federal Reserve could be aiding the US economy. Another round of quantitative easing isn’t necessarily one of them. The Bank of England produced a study on the distributional effects of QE, and found that, predictably, the benefits go to the rich. By pushing up a range of [...]

Royal Bank of Scotland Trader: Any Employee Could Change Libor

By: Friday August 24, 2012 6:15 am

The Royal Bank of Scotland is not having a good week. Earlier in the week they became the latest to be subject to investigation on the grounds of money laundering. Now they are embroiled in the Libor scandal, with one trader claiming that anyone at RBS had the opportunity to rig the benchmark interest rate: [...]

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