This page has been archived and commenting is disabled.
The World's Biggest Bank Just Got Thrown Into The Lieborgate Mess
When on Friday news broke that German regulator BAFIN (which is just like the SEC except that it also regulates, investigates and actually prosecutes, instead of just watching porn all day) was launching a probe of the biggest bank in Europe, and actually, make that the world, Germany's Deutsche Bank, the shares took a quick, brisk hit, sliding 5% with everyone anxiously expecting to find out just which bank will follow Barclays into the scapegoat abattoir (because nobody had any clue Liebor manipulation was going on until a week ago). Yet while external inquiry into banks is to be expected (everywhere but in the US of course, because in the US no banks manipulated anything. Ever) as a proactive act on behalf of regulators to cover their back, things get a little more tricky when the bank itself admits there was an obvious supervision problem. From Reuters: "Two Deutsche Bank employees have been suspended after it used external auditors to examine whether staff were involved in manipulating interbank lending rates, German magazine Der Spiegel reported, citing no sources." Now what can possibly go wrong if the biggest bank in the world, with just shy of $3 trillion in "assets", which just happens to have a 1.68% Core Tier 1 ratio, is suddenly thrust smack in the middle of the scandal that the Economist just aptly named the finance industry's "tobacco moment"?
From Reuters:
A spokesman for Deutsche Bank on Sunday declined to comment on the article, referring to its quarterly report, which said it has received subpoenas and requests for information from U.S. and European authorities in connection with setting interbank rates.
On Friday, people familiar with the matter told Reuters that Germany's markets regulator has launched a special probe into Deutsche Bank over suspected manipulation of interbank lending rates.
Investigators in the United States, Europe and Japan are examining more than a dozen big banks over suspected rigging of the London Interbank Offered Rate (Libor).
Britain's Barclays has been the only bank to admit wrongdoing, agreeing last week to pay a fine of more than $450 million.
The Libor rates, compiled from estimates by large banks of how much they believe they have to pay to borrow from each other, are used to determine interest rates on trillions of dollars worth of contracts around the world.
A spokesman for Frankfurt-based private bank Metzler said one of its investment companies has joined a number of class action suits in New York against banks accused of manipulating Libor rates.
"This is a standard procedure," he said.
And while all of that is fun and stuff, can we just fast forward to the moment where Jamie Dimon once again tells his Congressional muppets that LIeBOR is meaningless, and to look for their Christmas Libor-adjusted donation checks in the next few months.
»
- 13743 reads
- Printer-friendly version
- Send to friend
- advertisements -
Ladies and Gentlemen! Llllllllets get ready to ruuumbleeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeee!!!!!
Luckily, DeutscheBank was able to determine that it was only those two rogue traders who did all the manipulation of the LIBOR. This means that DB, and all the other banks, can go back to doing God's work while those two rogue traders rot in hell.
Exactly. We will now see two pawns publicly flogged. The only possible hope is that they pick the wrong pawns, and those pawns sing to the media in ways which even their masters hadn't imagined. But the latter is highly unlikely. This is afterall, the cartel that took down Spitzer and DSK with ease.
Throwing two pawns into the abyss will most likely be cake.
The question I have is: How will this affect the larger, more pressing Euroland saga with respect to Germany... Interesting developments....
but surely shirley these guys wouldn't manipulate anything else, like gold and silver, would they???
Quick. Can someone tell me without thinking what ISN'T manipulated?
Your portfolio.
Let's not feel sorry for the pawns ... TPTB will ensure that the two pawns get well compensated for their time in a private white-collar country club (aka minimum security prison). Then once all the muppets feel comfortable that justice has been served, we can all get back to business as usual.
Micah 6:11 Shall I acquit a man with dishonest scales, with a bag of false weights?
Speaking of laying low, where the FUCK IS CONZINE?
Deuteronomy 25:16 For the LORD your God detests anyone who does these things, anyone who deals dishonestly.
Douchebagerous Hondaridecus 7:77 For the prawns shall pay a price! For whosoever challenges SNOGON in the Land of Moron shall not have two prawns, but many!
Edit: Fuckit! I'm starting MY OWN religion. L.Ron Hubbard, Jesus, Mohammed, Joseph Smith, Buddha, Rael, Jones, Heaven's Gate. Man, what a bunch of shysters!
(Junk away!) Robertson, Osteen,..................
Why its not just two rogue traders.
http://hat4uk.wordpress.com/2012/07/08/libor-analysis-the-hints-of-globa...
There's no way it was more than a couple traders, this is an isolated event. Tell the guilty parties not to do it again and let our free market capitalist loving banking system do the rest, everything is fine.
In addition to the possible fines I wonder how much they have to pay the traders to allow themselves to be thrown under the bus. Traders make a bit of change so it won't be cheap. And since it has to be under the table it won't be as easy to write it off. Too bad they didn't have any Nigerian traders, much cheaper scapegoats.
This is just to explain what MFs they are, in the 90s I was a customer of DB in Germany, and to open a letter of credit they asked me to borrow at 10% from them and deposit at 2% with them to fund my Letter of Credit. Of course I did not and they still opened the LC. Closed account soon after.
ggg guns, gold and a getaway plan
take your money out of the commerical banks and put them in coummunity credit unions.
Crash the TBTF banks!
Business as usual, move on! Nothing will happen, algos are working as always, including DB ones!
Prost, ihr Säcke!
i just don't understand, for one thing, all the cynicism.
sheesh.
is it just an emotional left over, "barbaric relic",
of a time when the species lived intimately with scarcity accompanying each dawn and green shoot?
Yea it's not like people have to work everyday any more, they just work out of the goodness of thier hearts.
the message is clear, work is not nearly enough,
people are required to borrow even harder, much harder, for this thing to float. can we do it? therein
lies the answer me thinks.
There is something like $40 trillion in oblgations geared to LIBOR. And The Fed / Bank of England are the biggest manipulators of LIBOR.
http://confoundedinterest.wordpress.com/2012/07/06/libor-fixing-and-the-fed-funds-target/
It is more fun to blame the banks for everything, but at some point we have to start asking whether The Fed should be trying to manipulate interrest rates.
Or whether governments should interfering at such staggering levels. It is gettting out of control.
Just asking.
Make that over $500 trillion and you are correct: As Lie-Bor Unwinds, Just How Much Is At Stake?
FED and BoE certainly have contributed / created the mess. But, the only way you get into problems of 100T ++ is the average consumer.
Thanks to Fractional Reserve banking, anyone and everyone who uses credit cards, or has borrowed for any reason is responsible for inflating the problem of unmanageable debt.
Every second of every day we all contribute to the problem... And it will not end.. ever.
I don't think you understand Libor rates or what they do. It's not the borrowers who were screwed it's WE the savers that were screwed! Rates for borrows were held low. Savers received low returns. I am sueing Tiaa-Cref for holding the money market rates on part of my funds lower then fair! I encourage all of you to sue your pension funds for fraud on money market returns! This costs me tens of thousands over the years! Sue the bloody assholes!
I admit my understanding on LIBOR is rudimentary because I really haven't cared enough to research it. However, what I'm saying is that there is $500T in obligations borrowed and CDO'd into existence. That's been levered into over a Quadrillion in derivatives. It is what it is. LIBOR rates are manipulated to entice more borrowing.. Everything is "cooked" or manipulated with regard to banks.. And you really have no other choice but to play the game.
PS: I'd suggest not suing Tiaa-Cref.. You're just going to lose more money on lawyers.. Pull your money and tell them to f-off..
Save yourself some stress. Legal system is just as bad as banking.
Sad, but it's a bullish time to be a lawyer.
Let's mark this moment as the time we started using quadrillions.
So then half quadrillion is what's at stake.
let's make that a whole quadrillion, ok, 0_K?
we can just assume the bottom half is already underwater, at this point?
Snakeeyes said: "It is getting out of control"
No. It done got outta control YEARS ago.
In the Roman Empire, Snakeeyes, one could remark that all roads to Rome. In the Central Bank Empire, all roads lead to the Federal Reserve, aka The New York Federal Reserve Bank and its private owners. They’re the underwriters of last resort. And their paymaster, the American people.
The buck doesn’t stop at the Fed; it starts there.
the question is what big banks are not involved in this scandal, NONE
Support your local Credit Union!
Why am I not surprised about German Banksters?
Um these aren't regulation packages. You gotta show on the packaging the hazards of using LieBoR (Now with CoolFed flavour)
Come to where the fix is in, come to Lie Bor country!
Those things'll kill you.
All the lies have become boring.
This LIBOR story is going to serve as a powerful indicator of where we really are as a society. If the investigations lead to criminal charges, trials, punishment and major reforms (something at least on the scale of the S&L debacle), great. There may be hope for us yet.
But if this turns into a total whitewash (The money seems to have vaporized... It was just a few bad apples... Minor changes will keep this from ever happening again...We really must move forward and put this unfortunate episode behind us...etc, etc.) then forget it. We're hosed.
But either way, we'll know.
I think we already know...
+1 - Most know that they dont want to know.
Did you say soemthing about TomKat? I won't follow you on twitter then.
Libor manipulation is an industry defacto standard and represents the highest accomplishments of the world's most innovative and brightest--those chosen to do God's work.
God's work. Is that what they are calling it these days?
God's work. They aren't wrong. The God is Plutus, the God of wealth. I assume they mean their own wealth, not ours.
"Doing God's Work" - attributable to Lloyd Blankfein from November 2009.
http://www.youtube.com/watch?v=FzjKCR7vsFc
I think I need a drink or two or three and some hookers.
No sugar coating here. Yeah keep on buying that fucking app. No end in sight.
The Collapsing US Economy and the end of the world
http://www.paulcraigroberts.org/2012/07/08/the-collapsing-us-economy-end...
Well I am shocked, shocked. /sarc
Ich bin ein crook.
Eventually all banks will be tied in, and mass punishment will be impossible, because we NEED banks to survive - right?
Correct, correct, & sadly, correct.Unless,of course, the Second Coming is upon us & a few Christian bankers repent quickly
Need banks to survive? Not me for the past 12 years.
No worries, promises can be extracted from/ imposed on the citizens to cover everything.
Have their been any notable moves in LIBOR rates since this mess started unraveling? I would think that if it ever got out that every bank was actively keeping gold down for example or treasury yields, both would start to climb, if not explode upward.
We are all living in HY-BRAZIL. Everything we be fine move along.
Classic movie
http://www.youtube.com/watch?v=d8IBnfkcrsM&feature=youtube_gdata_player
The Germans are behind the scenes
The SQUID is behind the scenes. Goldman Sachs is behind everything and that means that the Fed is complicit. That makes this a much bigger problem than has come to light so far. The overall damages is likely to mount into the trillions and everyone who has ever had money in a bank account has suffered because of the rate fixes. People should be up in arms over this but even here, at ZH, where intelligent people can be found, people admit to not understanding LIBOR.
Jerome Kerviel aught to be looking to get off the hook for fiddlin' with the algos if its an industry wide problem. Banks fixing rates and prices?? Unthinkable!
Most of the world does not even know what libor is. I have only a vague idea. I have zero understanding of a crime here or of anyone being harmed in anyway by libor fixing. I was under the impression libor rates were fixed anyway.
Anyone with a money market fund has been screwed because of this. That's like anyone with savings account now. They're actually not savings accounts at most of the major money center banks. They're MM funds
Yes think of it this way jake88. You could have been making .0x on your savings but a few wealthy people said "I need moar bonus!" and POOF you made .00x on savings and they bought a yacht while you couldn't save enough up for a new spiderman towel.
Bank on bank crime.
Just blame the CBs. A central bank is nothing but a banking cartel anyway. It's not this is even remotely surprising. It's in the nature of what a banking cartel does. Why form it if you're not going to manipulate prices?
The business model of western finance is fraud. It's rotten to its very core.
So far just like the Blah Blah President nothing to be concerned about. More talk and talk and then the news just vanishes. I
Will something be done, will justice prevail. The answer of course is no this is the tip of the iceberg, no doubt something will be done but the rot grows and the centre cannot hold.
"When buying and selling are controlled by legislation, the first thing to be bought and sold are legislators."
-- P. J. O'Rourke
But lets not be too upset, enjoy the show, There will be blood, sooner or later.
Will someone please explain the crime!?
Fraud.
Both de jure and de facto.
The misrepresented the rate both internally and externally. Externally is probably not as big of deal. It certainly has a big impact. Internally the bonuses are based off the risk adjusted profit. If a bank is playing fast and loose with their reported funding cost, you can bet they've issued bonuses off a faulty risk adjustment. Fraud.
easy listening
3.47 popcorn&rye
http://www.youtube.com/watch?v=hx16a72j__8
Sue your pension funds or banks holding your money market accounts for FRAUD! They held your returns lower cheating you on lower than market rates! It's time to sue banks and funds that held savers to no returns on investment! Sue the bloodly bastards! Write your bank/fund tomorrow and tell them you are sueing them!
This is so fucked because, as bad as it is, about 1 in 10,000 understand it (& that's generous)...
That's why the bankers have humanity by the balls... I just keep waiting for nature to intervene (because corrupt politicians & legislators sure won't)...
What is the big deal about LIBOR skimming? Sheesh, rates are already rock bottom, a few bips here and there barely matters.
i hear that! at one point everybody on the planet knew then entire libor thing was bullshit b/c the "london inter-banksters" would not lend each other ten cents overnight for a long time, but put up a rate which people could use as if the banks had been lending
or did i dream that?
had a family member with a loan tied to libor: hello! wtf? over.
roger that, wtf. wtf? over and out.
The big deal is:
1) that there will be investors who bet big bucks on derivatives based on Libor and some of them will have lost big bucks as a result of the fraudulent calculation of Libor and they may sue everyone involved; and
2) the last bits of credibility for the banking system (and the banking regulators) just went out the window.
What about solar stocks? I took your recomendations and what didn't go bankrupt are now penny stocks.
07 July 2012
Weekend Viewing: Inside Job by Charles Ferguson
http://jessescrossroadscafe.blogspot.com/2012/07/weekend-viewing-inside-...
With apologies to the late Sen. Everette Dirksen, it's now "...a trillion here, a trillion there, now you're talking about real money."
I am sure that janitor responsible for this horrible incident and his sidekick assisstant of secretary of secretary of small finances department will be both severely punished.
I assume gold will be taken behind the woodshed over this.
1) Steal underpants
2) ???
3) Profit!
Where's Batman when you need him? :(
Didn't you hear? Turkish F4 Phantom jets (yeah, how old are they?) were scrambled to intercept a potential Syrian violation of Turkish airspace a week or so ago and one was supposedly shot down. Guess where the Turkish jets scrambled from?... Batman. So the Caped Crusader is still on the job. He's just working out of Turkey right now disguised as a military base.
Wow, almost eveything you wrote is not only wrong but backward. Do you live in a cave?
Well, with German government keeping DB afloat, how much money will be left for the ESM and target-2?
Oh, never mind, things are getting very ugly. We knew that already. The question is: when?
The world is close to a financial collapse, signals become more worrying by the week, day, hour....
As I post this, the Euro is trading at 1.2286.
"BAFIN (which is just like the SEC except that it also regulates.."
Bravo!
I cannot guess where any of the political maneuvering toward creation of the financial union in europe is going in the short term but, with Merkel essentially agreeing to the creation of a european central bank week before last followed by the breaking of liborgate coming suddenly to light and now German regulators investigating their largest bank for complicity?
It certainly does not smell right to all be unrelated.One would expect UK investigators to whitewash the investigation, how will the Germans handle it, or mishandle it?
Smells like the German populace are about to be (further) manipulated, regardless.
If there is no US investigation in the next week or two, then corruption really is king and the rule of law has taken retirement. Could all this be an effort to crash the Euro ?
If there is no US investigation in the next week or two, then corruption really is king and the rule of law has taken retirement. Could all this be an effort to crash the Euro ?
What's a law?
It's what 'we' make it!
(I wonder how long before Prof. Bill Black has an 'accident')
When someone comes up with the answer to the biggest question please let us know, why is this coming to light??? It's been around for years, it's can be seriously destabilizing, and they could have ignored it. A dead reporter or two, a shelved investigation or three and simple not putting together a commission and it all goes away. Yet that didn't happen. My Unusual-events alarm rings much louder when there is unexpected honesty than from fraud. There is some unseen change happening and it will have a major impact on the economy. Please post your conjectures, even the wild ones, about why they let this come into the open.
too many fiats, cooks, spoil the pillage, broth.
or
london is done rehypothecating and is being called
out by china through germany (desperate and realigning).
or
the aliens want the planet back.
or
the lack of real information has made everyone so stupid
that the system cannot even be maintained anymore so
some truth must enter the system.
or
give me a minute....
You asked for wild ones: Rev 17:18
You're a few months early IMHO
if 1 in 100,000 ideas are viable and valuable
the minds of "men" are wanting for direction.
given that the only absolute in the universe is
the speed of light and information travels at
that speed today and there are billions of people
on line we may have arrived at an information
awakening point where ideas can now be nearly
instantly vetted and offered and indeed, honesty
may be the only surviving policy left?
truth of context and information. maybe
time to adjust our alarm systems?
Ben Fulford has loads of theories...
I did ask for wild
The funniest thing about this whole charade is I am paying the game The Secret World where the Illuminati run the banking system.
Clearly someone there is a Zero Hedge reader. Its both funny, sad and true …
so what is the crime? hmmm..
.
It's Not Libor Stupid, Central Banks Are The Problem
http://www.forbes.com/sites/shahgilani/2012/07/06/its-not-libor-stupid-c...
.
"..What’s good is we now know for a fact that the traders (crooks?) were aided and abetted by their co-workers, the submitters (crooks?), who were overseen by managers and top executives, who design most of these schemes (crooks?), and were all blessed by the British Banking Association, an illustrious association of 200 some-odd banks, whose many members (crooks?) are panel members submitting crooked (no question mark necessary) data." ..
.
the crime is "stealing money". the charges could range
from treason to identity theft and everything in between
usually reduced down to perjury? not to dismiss
control fraud, rico, embezzlement, trespass, drinking and
driving, sodomy, indecent exposure, counterfeiting, forgery, and a book full of other offensive acts normally
reserved for people with no money or lawyer. oh, and
cannibalism and infanticide, separately and together.
.
"..But it gets worse. What will happen when the “multiplier effect” takes effect? I’m talking about the potential for massive inflation when all those huge quantities of reserves (stimulus) get lent out instead of shelved on balance sheets? How about massive inflation."
..
maybe all of m1 and m2 will be tied up in court for
eternity and we can go back to barter and scavenging?
Tier 1 assets are for wusses. Ponzi-backed deposits all the way, baby!
"..Not only are at least twenty more big banks under investigation as part of a massive fraud to manipulate interbank lending rates that affect some $800 trillion in loans and derivatives, but the Bank of England is about to take center stage in the scandal.
And that’s bad news for central banks around the world.
Well, actually, it could be good news, as in really good news if it’s the beginning of the end of what central banks do to manipulate free markets to the benefit of their only real constituents, the world’s big banks."
..
Thankfully, Barclays officials informed the public that central banks and regulators played their role in the scandal. This will give us a lot of precious moments, a lot of fun when those corrupt bureaucrats will have to try to explain that they never interferred with money market rates and never had a strong interest in the banks lowering their rates. If I am informed correctly, tomorrow BOE's Tucker will have to appear in front of the same commission that grilled Bob Diamond last week. Popcorn time!
trips to the grocery store soon to be replaced by trips to the woods as "hunter, gatherer" takes on a whole new meaning. Soon enough it is going to be what you know and not who you know. GGGG God, guns, guts and a garden, just saying.........days wages for a loaf of bread perhaps???
Planned Chaos?
ho hum...i pulled up an old zh article..why does it take 3 years when Tyler was talking about this sort of thing that long ago...sometimes its good to reminisce...
http://zerohedge.blogspot.co.uk/2009/01/this-makes-no-sense-libor-by-bank.html
only 3 and half years ago..dont see barclays quotes as out of line on that day..anyway
can anyone tell me why one year LIBOR for banks is lower than the annual premium charged on bank CDS? is borrowing money for a year from a LIBOR contributing bank, the same as shorting it via its 5 year bank CDS
anyway..its called a "fix" for a reason..it ought to be apparent to anyone in the know that no cash actually moves at LIBOR, only valuations that happen to be on what (even with 600 trillion of derivatives using it) just 1 in 100 cumulative dollars traded by the banks in the last three years vi fx and money markets NOT at precisely 11 am on just one side of a stupid quote..derivatives traders and regulators ar fault...why yes...bank trading desks ..well only if they had to use the corrupted derivatives market that exchanges cash flow based on valuations not dealing prices..
Oh WOW. Jim Willie was right. The Golden Jackass has been "Spot-ON" for a long, long time. Unless of course you'ld rather listen to Jim Cramer the Villiage Idiot!
http://www.tfmetalsreport.com/podcast/3782/tfmr-podcast-19-jim-willie
http://www.tfmetalsreport.com/podcast/3834/tfmr-podcast-21-jim-willie-returns
http://www.tfmetalsreport.com/podcast/3910/tfmr-podcast-23-jim-willie-trifecta
Camera #2, do we still have all that Dimon stuff? get ready to go live to JPM headquarters... What? You are not sure that Dimon is up to his pipik in the LIBOR scam? You'r fired, asshole! Camera #3, are you there?! Hey, I don't care about Blankfein and geithner doing unnatural sex, get over to JPM, STAT!!!
This bank along with JPM and HSBC are also involved in mass silver shorts.
the air bus is bigger
When all else fails, lie, cheat and steal. What hhappens to the common man when he lies, cheats and steals? Oh, never mind.