Inside Job (Photo credit: elycefeliz)LONDON, ENGLAND - JULY 04: Demonstrators, in Robin Hood outfits, stand outside Portcullis House as they wait for former Barclays Chief Executive Bob Diamond to arrive at Parliament on July 4, 2012 in London, England. Mr Diamond, who resigned as Barclays Bank Chief Executive yesterday, is expected to be questioned by the Treasury Select Committee about inter-bank interest rate-fixing that caused the bank to be fined £290 million. (Image credit: Getty Images via @daylife)Housing: HAMP Disaster Shows U.S. Treasury is "Fully Captured by the Big Banks" (g1a2d0021c1) (Photo credit: watchingfrogsboil)Banking District (Photo credit: bsterling)A multi segment panoramic image of the London skyline from the Bermondsey banks of the Thames. Français : Image panoramique de Londres depuis les rives de la Tamise. (Photo credit: Wikipedia)TED Spread Chart - Data 2008 zh-hant (Photo credit: Wikipedia)The TED spread – an indicator of credit risk – increased dramatically during September 2008. (Photo credit: Wikipedia)Dow Takes Giant Leap as Bailouts Snap Gloom (Photo credit: YoTuT)WASHINGTON, DC - MARCH 17: Special Inspector General of the Troubled Asset Relief Program Neil Barofsky, participates in a Senate Banking, Housing and Urban Affairs Committee hearing, on March 17, 2011 in Washington, DC. The committee is hearing testimony on oversight of the Troubled Asset Relief Program (TARP) and evaluating returns on taxpayer investments. (Image credit: Getty Images via @daylife)
Rigging LIBOR was shockingly easy. The estimates aren’t audited. They’re not compared with market prices. And LIBOR is put together by a trade group, without any real supervision from government regulators.
In other words, manipulating LIBOR didn’t require any complicated financial hoodoo. The banks just had to tell some simple lies.
Nearly four years after Washington began its huge rescues of banks with taxpayer dollars, an important player in this, one of the great financial dramas of all time, is offering a damning account of how the Bush and Obama administrations handled the whole episode.
“There has to be wide-scale acknowledgment that regulatory capture exists, dominates our system and needs to be eradicated,” Mr. Barofsky said in the interview. “It was my job to bring as much transparency to taxpayers so they knew what was going on. Writing the book, I tried to bring the same level of transparency so people understand how captured their government has become to the financial interests.”...
Another crisis is likely because of the failed response to this one. “Incentives are baked into the system to take advantage of it for short-term profit,” he said. “The incentives are to cheat, and cheating is profitable because there are no consequences.”
Inside Job (Photo credit: elycefeliz)
LONDON, ENGLAND - JULY 04: Demonstrators, in Robin Hood outfits, stand outside Portcullis House as they wait for former Barclays Chief Executive Bob Diamond to arrive at Parliament on July 4, 2012 in London, England. Mr Diamond, who resigned as Barclays Bank Chief Executive yesterday, is expected to be questioned by the Treasury Select Committee about inter-bank interest rate-fixing that caused the bank to be fined £290 million. (Image credit: Getty Images via @daylife)
Housing: HAMP Disaster Shows U.S. Treasury is "Fully Captured by the Big Banks" (g1a2d0021c1) (Photo credit: watchingfrogsboil)
Banking District (Photo credit: bsterling)
A multi segment panoramic image of the London skyline from the Bermondsey banks of the Thames. Français : Image panoramique de Londres depuis les rives de la Tamise. (Photo credit: Wikipedia)
TED Spread Chart - Data 2008 zh-hant (Photo credit: Wikipedia)
The TED spread – an indicator of credit risk – increased dramatically during September 2008. (Photo credit: Wikipedia)
Dow Takes Giant Leap as Bailouts Snap Gloom (Photo credit: YoTuT)
WASHINGTON, DC - MARCH 17: Special Inspector General of the Troubled Asset Relief Program Neil Barofsky, participates in a Senate Banking, Housing and Urban Affairs Committee hearing, on March 17, 2011 in Washington, DC. The committee is hearing testimony on oversight of the Troubled Asset Relief Program (TARP) and evaluating returns on taxpayer investments. (Image credit: Getty Images via @daylife)
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