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Wed Jul 11, 2012, 05:41 AM

INFOGRAPHIC: The LIBOR Scandal Explained ..Dialup warning

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Reply INFOGRAPHIC: The LIBOR Scandal Explained ..Dialup warning (Original post)
Ichingcarpenter Jul 2012 OP
dipsydoodle Jul 2012 #1
Melissa G Jul 2012 #2

Response to Ichingcarpenter (Original post)

Wed Jul 11, 2012, 06:11 AM

1. Libor is the rate that banks lend between themselves

Thereafter loans are based on Libor + whatever percentage. What the top up is is determined by lenders bearing in mind that they themselves are in competition.

Most references to this issue revolve around the rate being artificially lowered : not increased. As such investors who lost out on overnight money or short term money whatever would in theory be owed by those who gained i.e. borrowers of almost any description.

Simplest thing would be to unwind all deals , with any commissions repaid, to correct the situation.

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Response to Ichingcarpenter (Original post)

Wed Jul 11, 2012, 09:23 AM

2. Excellent post!Thanks!

Wonderful graphic.

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