Translated "Avante!" article by Jorge Cadima, Member of the PCP International Department
A few days ago, the British parliamentary commission on the Libor index falsification inquiry, questioned a Bank of England vice-governor if he were confident on the non-existence of cheating. The answer was: “ I cannot trust anything, after having heard about this cesspit” (in the Telegraph, 2101.07.09). Not everyday one agrees with a Bank of England vice-governor. The cesspit in question is the great finance. And it is the banking “that ought to be recapitalized”, a purpose which would justify the economies’ destruction and the ruin of states. The “markets” ought to be “appeased” and therefore it is needed to cut our rights, salaries, subsidies and holidays. It is official: the question is a cesspit.
The index within the scandal centre, is not small. According to the Wall Street Journal (2102.07.03) the Libor is used to “ fix rates for loans and by-products, of 800 trillion dollars”. A “trillion dollars”, in the USA’s terminology is a million of million dollars, and 800 trillions represents 11 times the GDP of the whole planet. This index is fixed every morning in the City, in London, based in 18 banks’ information and should point out the requested rates by other banks, concerning the inter- banks loans. What became currently of public domain, in the sequence of an initiated investigation beyond the Atlantic, is that the banks in reference ( the ones “that cannot fall into bankruptcy“ as that would provoke a “systemic risk” ) delivered forged false information, along many years. According to the press, some times lying had the purpose of satisfying colleagues involved in financial operations (authentic casino bets) where the profits or losses of many millions depended on the Libor value (in the Telegraph, 2102.07.01). In other occasions, and according to one of the implied banks (in the Telegraph, 2102.07.03) the Bank of England had requested them, concerned with minimizing the crisis’ effects upon 2008.The Euribor, a Libor fellow-company for the Euro zone, is also under investigation ( in The Guardian, 201\2.07.03),which is fixed in a similar manner by 50 banks (in Wall Street Journal, 2102.07.07). Many of “the great world banks” are under investigation (in The Economist, 2102.07.07). “ Probably, all the banking sector was occupied in manipulating the system at its own profit and with no concern with the consequences” (in The Telegraph, 2102.07.01).
And when gossip arises, things become somewhat interesting. Up to the current moment, within Barclays, the major English bank, only important heads have fallen. Curiously, its CEO - sacked with the Bank of England’s interference - was a North-American and known as the most well-paid banker in England (in Bloomberg, 2102.07.03). Since 2006, he received “100 million pounds regarding salaries and subsidies” (in The Guardian, 2102.07.02). The amount a Portuguese worker, earning the minimum salary would receive at the end of 18. 700 years of work, if the holiday and Christmas subsidies weren’t to be cut off…
Regretting his talent was not being appreciated, “ the Barclays CEO threats to retaliate”(in the Financial Times, 2101.07.02) and reveal information implicating the Bank of England in the scandal. A Financial Times analyst is annoyed and only the Godfather film music is missing: “here goes an advice for Bob Diamond’s successor, as a Barclays CEO: nobody threats the Bank of England. If that is to happen, they will suffer deportation.[…]The Bank cannot be threatened. The City, is not a kind of financial democracy. It is an hierarchy” (in Financial Times, 2102.07.03). The USA’s Federal Reserve has already delivered information in which the Bank of England was silently aware of the Libor cesspit, since 2008 (in Wall Street Journal, 2102.07.14).
One anxiously awaits the further soap chapters. But one must doubt the results: in the Bank of England’s Governor annual speech, more public money was asked for in order to finance the banking ( in The Telegraph, 2102.07.014). It will be promised to be directed to improvement reparations. But nor even with the EFSA’s (Economic and Food Security Authority) certificate, this will never stop being a cesspit.
