An anonymous insider from one of Britain’s biggest lenders – aside from Barclays – explains how he and his colleagues helped manipulate the UK’s bank borrowing rate. Neither the insider nor the bank can be identified for legal reasons.
It was during a weekly economic briefing at the bank in early 2008 that I first heard the phrase. A sterling swaps trader told the assembled economists and managers that “Libor was dislocated with itself”. It sounded so nonsensical that, at first, it just confused everyone, and provoked a little laughter.
Before long, though, I was drawing up presentations to explain the “dislocation of Libor from itself” for corporate relationship managers. I was deciphering the subject in emails, internally and externally. And I was using the phrase myself openly with customers of the bank.
What I was explaining was that the bank was manipulating Libor. Only I didn’t see it like that at the time.
Too Big to Fail
For a country that constantly extols the virtues of its large and prosperous financial sector, Britain can sometimes seem curiously inept at providing basic banking services.
This is not just a question of the everyday niggles that irk the average high-street banking customer: the monstrous charges levied on simple products, for instance, or the seemingly endless wait to get through to operatives at remote call-centres. There is also the rolling barrage of mis-selling scandals. The latest involved banks selling duff derivatives to their business customers. And to this “plain vanilla” malpractice has now been added a subgenre of even subtler scams, such as Barclays’ tweaking of the London interbank offered rate – a key interest rate for banks.
Why Is Nobody Listening to Jimmy Carter’s Searing Critique of America?
If you told the average American that there was a very powerful politician who, after leaving office, tried to speak out when his conscience was bothered by the actions of his fellow political insiders; if you told them that he abandoned partisanship, calling out even members of his own political tribe; if you told them that he said what he thought to be true even when it was uncomfortable, even when it lost him friends, even when it was seen as a betrayal by other powerful people, who shunned him; if you told Americans all that, you would think they’d express admiration for the mystery man.
Yet few celebrate Jimmy Carter.
He criticizes America. People don’t like that.
Here’s his latest critique, published in The New York Times:
80% of Offline Voter Records are Matched to a Cookie
Wow. Datagrid spokesperson says they have matched 80% of offline voter records to an online cookie. She’s proud. I’m worried. #pdf12
via the “Personal Democracy Forum” 2012.
Count Robert de La Rochefoucauld
Other disguises also came in useful. On the run in occupied Bordeaux he dressed as a nun. In later life he helped Maurice Papon to flee to Switzerland.
Robert Jean-Marie de La Rochefoucauld was born in Paris on September 16 1923, one of 10 children of an aristocratic family which lived in old-fashioned splendour on Avenue de la Bourdonnais, in the shadow of the Eiffel Tower. An ancestor was François de La Rochefoucauld, famous for his maxims. Robert’s mother (née Wendel) was daughter of the Duke of Maillé. His father’s family retained a private carriage which was hitched on to trains during rail journeys.
Considered a sickly child, Robert was sent to a succession of private schools for the jeunesse dorée in Switzerland and Austria where, in 1938, he was taken on a school trip to Berchtesgaden, Hitler’s Alpine retreat. When Hitler’s convoy drew up, the Fuhrer approached and patted Robert on the cheek affectionately. It was, La Rochefoucauld later recalled, a dream come true for his 15 year-old self. Hitler was then the great statesman of Europe; young Robert and his schoolmates had attached swastikas to their bicycles in admiration.
Good News, Crazy News
And so 2012 has followed the same energy pricing cycle as early 2011. Pricing for oil and gasoline started climbing in February, infuriating many by late March – when the pundits came in suggesting that gasoline could possibly reach $5 a gallon by summer. And then, miraculously, prices started falling in May right before the summer driving season, when prices are supposed to be rising. What was interesting this year, as last, is that when those driving oil prices were asked what was causing the massive price increases, they pointed to the booming world economy. The usual suspects; China, India, the European recovery, our own GDP’s improvement and so on.
Sure, everyone would mention the upcoming Iranian oil embargo; just as last year it was the civil war in Libya, not to mention the constant mantra that oil supplies worldwide were tightening. Of course, it made for a rivetingly story – but now we know that little of it was true.
The Triumph of the Family Farm
We buried my grandfather last spring. He had died in his sleep in his own bed at 95, so, as funerals go, it wasn’t a grim occasion. But it was a historic one for our small rural community. My great-grandparents were early settlers, arriving in 1913 and farming the land throughout their lives. My grandfather continued that tradition, and now rests next to them on a hillside overlooking the family homestead.
If you’re a part of the roughly 99 percent of the North American population that doesn’t work on a farm, you might guess at what comes next—many a lament has been written about the passing of the good old days in rural areas, the family farm’s decline, and the inevitable loss of the homestead. But in many respects, that narrative itself is obsolete. That’s certainly true in my family’s case: The Freeland farm is still being cultivated by my father. And it is bigger and more prosperous than ever.
My dad farms 3,200 acres of his own, and rents another 2,400—all told, a territory seven times the size of Central Park. Last year, he produced 3,900 tonnes (or metric tons) of wheat, 2,500 tonnes of canola, and 1,400 tonnes of barley. (That’s enough to produce 13 million loaves of bread, 1.2 million liters of vegetable oil, and 40,000 barrels of beer.) His revenue last year was more than $2 million, and he admits to having made “a good profit,” but won’t reveal more than that. The farm has just three workers, my dad and his two hired men, who farm with him nine months of the year. For the two or three weeks of seeding and harvest, my dad usually hires a few friends to help out, too.
Failure and Rescue
We had a patient at my hospital this winter whose story has stuck with me. Mrs. C. was eighty-seven years old, a Holocaust survivor from Germany, and she’d come to the emergency room because she’d suddenly lost the vision in her left eye. It tells you something about her that she was at work when it happened—in the finance department at Sears.
She’d worked her entire life. When her family left Nazi Germany, they narrowly avoided the concentration camps but ended up among twenty thousand Jewish refugees relocated to the Shanghai ghetto in Japanese-occupied China. She was a teen-age girl and spent eight years there, helping her family just to live and survive, until liberation in September, 1945. Denied a formal education, she worked as a seamstress upon admission to the United States. She rose to head seamstress at Bloomingdale’s in Chestnut Hill, outside Boston. She married at twenty-three, had two sons, and was widowed at forty-four. She herself remained in remarkably good health.
How I Accidentally Kickstarted the Domestic Drone Boom
Look up into America’s skies today and you might just see one of these drones: small, fully autonomous, and dirt-cheap. On any given weekend, someone’s probably flying a real-life drone not far from your own personal airspace. (They’re the ones looking at their laptops instead of their planes.) These personal drones can do everything that military drones can, aside from blow up stuff. Although they technically aren’t supposed to be used commercially in the US (they also must stay below 400 feet, within visual line of sight, and away from populated areas and airports), the FAA is planning to officially allow commercial use starting in 2015.
What are all these amateurs doing with their drones? Like the early personal computers, the main use at this point is experimentation—simple, geeky fun. But as personal drones become more sophisticated and reliable, practical applications are emerging. The film industry is already full of remotely piloted copters serving as camera platforms, with a longer reach than booms as well as cheaper and safer operations than manned helicopters. Some farmers now use drones for crop management, creating aerial maps to optimize water and fertilizer distribution. And there are countless scientific uses for drones, from watching algal blooms in the ocean to low-altitude measurement of the solar reflectivity of the Amazon rain forest. Others are using the craft for wildlife management, tracking endangered species and quietly mapping out nesting areas that are in need of protection.
The Scam Wall Street Learned From the Mafia How America’s biggest banks took part in a nationwide bid-rigging conspiracy – until they were caught on tape
But USA v. Carollo marks the first time we actually got incontrovertible evidence that Wall Street has moved into this cartel-type brand of criminality. It also offered a disgusting glimpse into the enabling and grossly cynical role played by politicians, who took Super Bowl tickets and bribe-stuffed envelopes to look the other way while gangsters raided the public kitty. And though the punishments that were ultimately handed down in the trial – minor convictions of three bit players – felt deeply unsatisfying, it was still a watershed moment in the ongoing story of America’s gradual awakening to the realities of financial corruption. In a post-crash era where Wall Street trials almost never make it into court, and even the harshest settlements end with the evidence buried by the government and the offending banks permitted to escape with no admission of wrongdoing, this case finally dragged the whole ugly truth of American finance out into the open – and it was a hell of a show.