Looking at the report on Barclays it seems it referred to rate rigging between January 2005 and July 2008. So, before the alleged conversation. So, no defence on that score. So, one wonders whether the report itself was rigged to avoid implicating politicians / senior civil servants? Let's hope the truth outs and all implicated bankers face the full force of the law, repay all previous earnings and maybe get extradited to the USA. Let's hope that if any politicians colluded or influenced the alleged rigging they too get extradited.



I just hope tomorrow is explosive (metaphorically).

4th of July, bound to be fireworks

This gent sums up things well, in my opinion: www.standard.co.uk/business/mark ... rnalSearch

This gent sums up things well, in my opinion: www.standard.co.uk/business/mark ... rnalSearch

Thnking about the LIBOR enquiry again, who better to enquire into the dodgy dealings than those past-masters on lying, cheating and fiddling - our MPs?

It's a desperate defence, he's trying to implicate politicians and hope that they'll back off.

Despite the hysterical and typically biased article in The Sun (the one posted in the NHS thread) and others, all that I can see is that someone from the BoE (which is independent) and someone from Whitehall asked Barclay's why they were at the top end of the LIBOR rates.

How there is a leap from that to telling or sanctioning Barclays to artificially fix the rate is beyond me.

The way LIBOR is set is also interesting.



16 banks are consulted and the top and bottom four are discounted before the middle eight are consolidated. To have any real effect, there would need to be collusion on a grand scale.

Yes, but not as far as why they would actually [ido[/i the fraud, even if they believed the BoE had [isanctioned [/ithe fraud, is beyond me.

For me, this calls into question the myth of the omnipotent CEO: the 'top talent' who therefore command the top salaries. Bob Diamond has just said he knew nothing of the LIBOR fiddle. Let's suppose that's true. If Barclays made huge profits because of this fiddle, [ihe[/i would reap the rewards in terms of salary and bonus. But he knew nothing about it. It was nothing to do with him. This accords with my own experience from the days when I was a wage slave: many of the things which led to reduced costs/increased income were due to the efforts of people throughout the company, not just the CEO. And yet it's the CEO who gets the big pay. Time for limits on executive pay, methinks.

Someone's been busy making some stickers for Boris's Bikes:

I've long maintained the same - 100 x the lowest paid seems about fair.



The when it comes to executive bonuses, that should apply across the board too. So if the CEO is paid £1m and receives a bonus of £5m then everyone in the company should receive a bonus of 5 x their annual salary.

When you add to this the shambles at Nat West last few weeks the CEO's seem to have very little control over the actual [irunning[/i of the bank. They seem powerless and in effect have delegated the running of the bank to lower down managers as they claim to be in the dark over most things. If that is so then I don't see how they deserve the vast salaries anyway. In Diamond's case he couldn't even engender a suitable culture at the bank that would have stopped his employees from even thinking about rigging the rate. That is definitely CEO territory.



I think you are spot on about the money earned by the bank being down to its employees rather than the CEO. The trouble is the bonus culture spreads a long way down with even ordinary employees having some element of their wages made up from bonuses. This is a very American way of doing it. If the employee doesn't meet targets the wage bill is less and if they do, then the bank makes more money. This ignores the old fashioned way of doing business where people didn't cut corners to make a bonus and some staff in the regulatory areas of the bank would have seen it as their duty to put the brakes on sharp practice even if that did mean less profit for the bank. You worked hard for your salary but you did the job right.



I also found it really interesting that the rate rigging was done via email exchanges. I am sure in the past before IT systems allowed this easy communication the paths of the people setting the Libor rate and the traders never crossed. A Chinese Wall would have existed between these two sets of people as they just never met. It seems to me no one thought that it might not be a good idea for these two groups to be in such easy communication and preventing that sort of thing should have been put in place by Diamond.



I have worked in banks as a software supplier for years and they were always extremely keen on a proper division of labour in that those involved in IT security and the like were distinctly different groups and staff were often swapped in and out regularly so as not to become too familiar with the systems to prevent any abuse. It seems that sort of culture has gone.