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Lieborgate Escalates As Barclays Implicates 'Rest'

Submitted by Tyler Durden on 07/14/2012 19:48 -0400

In a memo released to Barclays staff, outgoing Chairman Marcus Agius appeared to throw the rest of his Liebor-fixing cohort banks under the bus, noting that "As other banks settle with authorities, and their details become public, and various governments' inquiries shed more light, our situation will eventually be put in perspective" by the fines handed out to other international banks. As Sky News reports, it appears 90 million emails and 1 million voicemails will be made available to the independent body spearheading the Liebor probe - the details of which are being finalized this weekend. While the rest of the memo focused on the restoration of Barclays' reputation and the "trust that has been so badly damaged", they quite clearly hinted at its rivals were likely to be hit with even harder fines that the GBP290 million imposed on Barclays. They add, as if we did not need reminding that "the macro-environment remains febrile, especially in Europe. We have to remain vigilant on balance sheet exposures and risk management. In short, our focus must remain on capital, funding and liquidity; improving returns; and driving income growth." But we can't help but feel a Citi's Chuck Prince-esque defense coming here that 'everyone was doing it' and while the music still played, we kept 'dancing'.

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Sat, 07/14/2012 - 19:51 | 2616523 Jeronimo

SOP and we're sorry and won't do it again, promise.

Sat, 07/14/2012 - 19:59 | 2616526 Dr Benway

Who would have thought that bankers are backstabbers too?

Who would have thought that as soon as a crime cartel fails, everyone turns on each other?

Next step is to RICO all of their sorry asses.

Sat, 07/14/2012 - 20:01 | 2616529 cbxer55

The Mafia set the precedent there, no? Soon as one of them ends up in the clink, they turn into a stool pigeon.

How can you soar like an eagle, when you work with a bunch of stool pigeons?

Sat, 07/14/2012 - 20:16 | 2616547 Bananamerican

"everyone was doing it"

"If everyone was pulling their money out of a corrupt global banking system would you do it too??.... WELL, young man!!?"

Sat, 07/14/2012 - 21:20 | 2616613 nmewn

And this..."...driving income growth."

They all go to the same damned management seminars and conventions, its really incestuous.

Year before last it was "synergies" until everyone figgered out synergy meant "layoffs"...somebody quick!!!...get the marketing head in here, we need new catch phrases to impress the plebes!!!

Sat, 07/14/2012 - 22:16 | 2616668 Bananamerican

"Solutions™"

as in Final Solutions for banking system...

Sat, 07/14/2012 - 23:23 | 2616735 nmewn

Fractional reserve banking must stop and a return to sound money.

There is nothing to say (theoretically) that gold & silver are not dramatically higher (in fiat terms) than what its valued at in those terms today. That is, a house valued at 100k can be paid off with ten simple coins of any country's manufacture...well, maybe not Russian tungsten filled...lol.

It is real money, will always be real money and is a lot harder to counterfeit because of the labor required. It doesn't take much labor to hit the print button and apparently much less brains.

The only thing holding this thing together is the value the system places on ink, paper and trust. The first two have minimal value in the real world and the latter has completely evaporated.

Many got greedy while only a few really REALLY profited while pandering to all...it was a remarkable ponzi while it lasted.

///////////////

Edit: There is nothing inherently wrong with lending what is there to lend. But you can't lend a debt, that is, calling a debt an asset. Its not. Its only a claim in a future (possible) default if secured. Its still the borrowers asset not the lenders.

Hope I cleared that up but I'm sure I didn't because now we turn to enforcable law which is as malleable as fiat paper currency itself.

Sun, 07/15/2012 - 02:05 | 2616921 Michael

Everyone was doing the mortgage broker fraud thing during the housing boom too, and we see how that turned out.

Sun, 07/15/2012 - 07:56 | 2617043 MillionDollarBoner_

"They all go to the same damned management seminars and conventions, its really incestuous."

but...but...but...collusion and cartel-like practices are illegal...aren't they?

Sat, 07/14/2012 - 20:19 | 2616548 Extremist Tan

good luck with that RICO case. The LAPD will find the guys who stole Lebowski's car before that happens.

Sat, 07/14/2012 - 20:20 | 2616554 graspAU

"Wouldn't hold out much hope for the tape deck... or the Creedence."

Sat, 07/14/2012 - 20:55 | 2616589 vast-dom

Sue The Fed and BOE! They are most destructive rate fixers.

Sat, 07/14/2012 - 21:10 | 2616605 SGS

You cant sue Ziojew Fed, when the lawyers you think are on your team are ziojews themselves representing the Fed in hiding. They have all bases covered.

Sat, 07/14/2012 - 22:00 | 2616649 world_debt_slave

Mutual Assured Destruction card to play.

Sat, 07/14/2012 - 19:58 | 2616527 cbxer55

Fingers crossed behind their backs, of course!

NEXT!

Sat, 07/14/2012 - 20:05 | 2616532 ekm

Same as with Lehman, the system is so much clogged that they had to throw Lehman to the wolves on purpose to unclogg the system. It was a setup. Three days later they found money to bail out AIG. Why couldn't they bail out Lehman 3 days earlier?

I remember Tyler wrote once few months ago: Barclays are the Lehman of UK.

My take: The system has been so much clogged since November 2011 when european banks stopped lending to each other, that only throwing the weakest link to the wolved would unclogg the system, even temporarily. Barclays is the weakest link. It's going to the wolves, very very very soon.

Once that happens, let's wait for Benny and Timmy to pull the same trick as Benny and Hank in 2008, beg congress for money. I love this show, I adore it.

Sat, 07/14/2012 - 20:14 | 2616545 Tom Green Swedish

Barclays is the Lehman of UK. They bought Lehman when they failed.

Sat, 07/14/2012 - 20:36 | 2616573 ekm

As I said: The weakest link.

Sat, 07/14/2012 - 20:50 | 2616585 smiler03

Have you looked at Lloyds-TSB, HBOS and RBS lately? Barclays almost look credit worthy by comparison.

Sat, 07/14/2012 - 20:53 | 2616588 ekm

Nobody really knows who's got what. What matters is what the US Fed + Bank of England + ECB + Bank of Japan decide by orders from politicians. Connections with governments become of importance number 1. I don't see any government protecting Barclays right now.

There is nothing bloodier than ELITE INFIGHTING. This is purely survival of the fittest among elite.

Sat, 07/14/2012 - 21:18 | 2616611 Tom Green Swedish

Looks like the London "Thee Financial Hub of the World" is a big joke. What a bunch of losers. First they try and control the United States. Now they try to control the money. UK is a big joke. The Olympics in England will be a joke. The Royal Family is a bunch of clowns. UK is full of Arabs and Russians. UK is finished.

Sat, 07/14/2012 - 20:21 | 2616557 pvzh

Could you elaborate on that? How throwing anybody to the wolves can "unclog" the system? All other criminals will be still in place continuing doing whatever they were doing before.

Sat, 07/14/2012 - 20:33 | 2616567 ekm

Money destruction.

Eliminating one or two players could temporarily create a false feeling that the parties HIDING toxic securities are out, so let's start business as normal lending to each other.

That's what happened with Lehman. The fallout destroyed about $50 trillions of toxic assets including swaps and derivatives. The hope was to TRICK the pension plans and world banks into believing that the toxic stuff was gone forever with Bear Stearns and Barclays.

It's like cleaning up the street from flooding. It doesn't mean that the street can handle the next torrencial rain. There's too much money lying around as toxic that nobody trusts anybody.

Destruction is mandatory.

Sat, 07/14/2012 - 20:36 | 2616574 pvzh

I see your point. Very well put.

Sat, 07/14/2012 - 20:56 | 2616578 ekm

Thx a lot.

I'm thinking this time they will aim for about $100 trillion. The system as per most recent Zerohedge articles is about $600 trillions including swaps and derivatives, covered or collaterized by just 70 trillions of .........................government bonds............that are basically NOTHING by itself.

My bet: At least 100 trillion this time, just at least.

Sat, 07/14/2012 - 21:00 | 2616592 ekm

I even think they were ready to do it again in Nov 2011, but Iran changed the course of events.

Public opinion would be 100% against attacking Iran during a world financial crisis.

SIMPLE SPECULATION: Once Iran is out, we'll have Lehman x 5 times. That could mean that attack on Iran could be imminent.

Sat, 07/14/2012 - 20:07 | 2616536 TahoeBilly2012

Has this worm finally turned? Have all these people finally realized they might just be safer in jail than on the streets? They aren't stupid, they can see Greece swirling the drain and they probably are REALLY TRULY starting to turn on each other. Now.... how about the politicians? Nope, those guys are the real first rate psycopaths...the will claim to have a new solution as the they are walking the gallows...bankers are smarter I am sure.

Sat, 07/14/2012 - 21:46 | 2616632 luna_man

"TahoeBilly2012"...

Did I read "walking the gallows"?...I LIKE IT!!

Sat, 07/14/2012 - 20:12 | 2616540 surf0766

Where can I get Kolejka ?

Sat, 07/14/2012 - 20:12 | 2616542 FieldingMellish

The longer we leave the edifice that is modern finance standing, the deeper the rot will set in. Tear it all down now and be done with it.

Sat, 07/14/2012 - 20:19 | 2616551 bigdumbnugly

But we can't help but feel a Citi's Chuck Prince-esque defense coming here that 'everyone was doing it' and while the music still played, we kept 'dancing'.

yep, dirty dancin'

but they did have the time of their lives didn't they?

Sat, 07/14/2012 - 21:10 | 2616606 I am Jobe

Where the fuck is Prince? Time to get the Mother fucker to say Somalia and let him rot there.

Sat, 07/14/2012 - 20:21 | 2616552 tom a taxpayer

The report says "the macro-environment remains febrile, especially in Europe". As we know from Biology 101, a febrile is a fertile, fecund gerbil spawning thousands of rodenticide-resident gerbils. The gerbils are causing the recession, devouring all the truffles and roquefort in France, all the grapes in Tuscany vineyards, all the tapas in Spain, all the sauerkraut in Germany, all the bangers and bacon in Britain.

Will destroying the gerbils bring green shoots? But that is a moot question: Europeans can not destroy gerbils because gerbils are on the European list of Threatened and Endangered Species.

Sat, 07/14/2012 - 21:01 | 2616597 infinity8

You made me hungry :0

Sat, 07/14/2012 - 20:45 | 2616582 LoneStarHog

Tyler, you have the wrong bus. This is the correct bus> http://www.imcdb.org/i476801.jpg

Sat, 07/14/2012 - 20:49 | 2616586 RobotTrader

They will slap a few fines here and there, threaten additional regulations, etc.

Then it will be back to the same old schemes, scams, and skullduggery in some other form that will remain undetected for years.

Wall St. Skimming has been around for 120 years, I doubt anything is going to change.

Since the 2008 crisis, the Alpha Pigs have simply increased their power and authority over the system, so there is no telling what is really going on that we don't yet know about.

Sat, 07/14/2012 - 21:56 | 2616642 Yen Cross

Robo . Rollover> You're a bandwagon ass clown!

Sun, 07/15/2012 - 17:48 | 2618492 sitenine

I think someone hacked Robo's ZH account.

That actually makes sense!

Sat, 07/14/2012 - 21:04 | 2616598 I am Jobe

Holy shit, who the F would have thought. Rome all over. I wonder when these fuckers will hang themselves.

Sat, 07/14/2012 - 21:06 | 2616601 El

Well, then... as long as everyone was doing it....

Sat, 07/14/2012 - 21:07 | 2616602 Gooseleg

Rats are not above eating other rats

Sat, 07/14/2012 - 21:08 | 2616603 Snakeeyes

Did Barclays mention the Fed and Bank of England?

Or Col Mustard (Bernanke) or Professor Plum (Geithner)?

http://confoundedinterest.wordpress.com/2012/07/06/libor-fixing-and-the-fed-funds-target/

Sat, 07/14/2012 - 21:09 | 2616604 death_to_fed_tyranny

DO LIKE CHINA! DEATH BY BULLET IN THE HEAD! THEN CHARGE THE FAMILY FOR THE BULLETT!

Sat, 07/14/2012 - 21:13 | 2616607 Snakeeyes

http://confoundedinterest.wordpress.com/2012/07/12/new-solution-to-unemp...

Sat, 07/14/2012 - 21:15 | 2616610 Flakmeister

Since this seems to be a slow night, I'll throw out the following

Of course, we can look at forecasts of resource depletion (such as the Limits to Growth analysis) as another example of Ruthless Extrapolation.In fact, let's look at walking: every step is a controlled fall. If we didn't put the next foot in place, we'd crash to the ground. So, every step we take as we walk can be extrapolated to a disaster...

To which the reply was:

I would put the primary message of Limits to Growth (LTG) in a different category than the typical "ruthless extrapolators." The reason is that they used nonlinear models containing all the feedbacks they imagined may be important, and let the computer "solve" the dynamics. They did not know what to expect, and after initial dismay over the results, worked very hard to engineer their model to avoid a decline in human welfare before 2100. They succeeded in stabilizing the model—but only by introducing extreme (impractical) global controls on reproduction and industrial activity.

The main point is that calling LTG an example of ruthless extrapolation is grossly unfair considering the sophistication of their approach. Remember that ruthless extrapolation carries the flavor of "look what's been happening the last X years. Project this (unchanging state) forward, and look at the unbelievable result." Unbelievable is right. LTG does not fall into this trap. And they repeatedly state clearly that they are not making predictions, but rather trying to elucidate modes of behavior in a complex system.

If you are focusing on their materials table rather than their model, then you're doing what many others who aim to discredit LTG have done: pick a minor, early part of their text (also explicitly described as not being a prediction) and using this to throw mud at the entire thing&mdah;presumably because the overall message is unpalatable, so must be destroyed. And even on this front, your walking comparison skips over the notion that all our earthly minerals are finite, implying that there will be no limits if we just have the courage to put the next foot out. Ever seen someone walk into a wall? It's not the "controlled fall" that ends up hurting. Other modes can assert themselves.

See Ugo Bardi's account of the methods by which various people strove to discredit LTG.

In a similar vein, the guys trying to model the Earth's energy balance early on were blown away by how sensitive the system was to perturbations,,,,

Anyway, I put this out to see what, if any intellligent discussion will emerge, I'll check back later.

Toodles....

Sat, 07/14/2012 - 21:47 | 2616624 sitenine

If we didn't put the next foot in place, we'd crash to the ground. So, every step we take as we walk can be extrapolated to a disaster...

You don't see that it's not about walking? It's about running out of ground to walk on (think cliff here). LTG doesn't apply to financial instruments perhaps? I highly doubt it. You see, it has very little to do with resources at this point (think unencumbered assets that can be plegged as colateral here). It's about eternal growth being the only way forward (think ponzi and exponential function here). The crux of the 'solution' in the article above is, "improving returns; and driving income growth." And they're dead serious. The crazy fucks think they can grow their way out of this financial shitstorm. I would argue that they are wrong.

Sun, 07/15/2012 - 00:47 | 2616864 Flakmeister

A resonable conclusion....

Sat, 07/14/2012 - 21:57 | 2616634 tom a taxpayer

The Limits to Growth analysis (and the response to LTG) both failed to consider the exponential growth of gerbils in Europe in the first decade of the 21st Century. The parabolic rise of the febrile population (Super Fertile Gerbils) is responsible for what you call "introducing extreme (impractical) global controls on reproduction and industrial activity."

Ever see someone slip on a gerbil? It's not the "controlled fall" that ends up hurting.

Sat, 07/14/2012 - 21:47 | 2616633 GubbermintWorker

it appears 90 million emails and 1 million voicemails will be made available to the independent body spearheading the Liebor probe

And those brilliant bankers didn't realize that emails and voicemails are so wonderfully digital and easy to access?

Mon, 07/16/2012 - 09:32 | 2619920 PrinceDraxx

They probably aren't that stupid but, they might not have known that ISPs keep transmitted emails for as long as 2 years and the US government started snagging and keeping emails a long time ago. In fact, gov now keeps a copy of every email being sent in the US so you might want to be a bit more circumspect. Just saying.

Sat, 07/14/2012 - 22:27 | 2616680 FischerBlack

Yawn. Everyone who knows anything knows LIBOR is derived from more or less gamed numbers. It's been this way for decades. Individual banks on average tend to report lower numbers than otherwise, to keep up appearances. So, it's not a bad idea, other things equal. to borrow with a LIBOR fix. What would be a real story, though would be evidence of widespread collusion among separate banks to manipulate LIBOR itself. *That* might have some fireworks attached.

Sat, 07/14/2012 - 23:15 | 2616745 palmereldritch

The wheels on the bus go round and round...all through The City

http://www.youtube.com/watch?v=AsAzI4Jdsj0

Sun, 07/15/2012 - 00:36 | 2616845 newengland

A letter from the Crime Division of the U.S. Department of Justice made it crystal clear to Barclays that it would face criminal prosecution if it failed to volunteer information regarding Libor fixing.

Barclays is the designated 'snitch', obliged to 'grass up' its rivals. It will. Barclays rivals be aware of this.

Barclays must volunteer the information, not merely answer questions when asked.

Sun, 07/15/2012 - 07:16 | 2617029 genr8n

From 2009 ... "The value of Barclays fell by a quarter in stock market trading yesterday, amid a series of wild rumours about its finances, although the bank said it saw no need to comment on the drop. Its board said in a statement last night that it knew "no justification for the fall"."

They later manufactured "no justification for the fall",thus manipulating the stock price as well as Lie-Bor. But that's not illegal...is it?

http://www.independent.co.uk/news/business/news/british-banks-are-techni...

Sun, 07/15/2012 - 10:15 | 2617151 ddtuttle

It is disturbing that "everyone" has known LIBOR has been rigged for decades. You have to wonder why the authorites are singling out Barclays and LIBOR right now. If the Fed and BOE are implicated, then you know it wasn't just everybody doing it, it was a systemic way of doing business, and there is no reason to think it stopped with LIBOR.

True civilization begins when the higherst government officials and wealthiest citizens are subject to the rule of law just like the powerless and the destitute. Whne you see the rule of law stunted for the rich and powerful then you're on a precipice. You can step back or plunge into the abyss. The scope of this scandal tells us we are on that precipice.

The srambling to keep this limited to Barclays and LIBOR will be telling. I hope it breaks out into wa between all the participantsr, because then we will see the true scope of the corruption. This just might be the first step in cleaning up the entire system, although we're a LONG way form that.

Lieborgate Escalates As Barclays Implicates 'Rest'

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