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Libor Fraud Was Happening In 1991, Trader Says, 17 Years Before Timothy Geithner Claims He Knew
Tim Geithner claims he learned of Libor manipulation when the rest of us commoners did, in 2008. New evidence keeps coming out suggesting he should have known much, much earlier.
The latest example — which puts the earliest time-stamp on Libor manipulation we’ve seen yet — is a Financial Times op-ed by former Morgan Stanley trader Douglas Keenan. He claims that Libor, a key short-term bank lending rate that affects mortgages and other interest rates throughout the economy, was being jerked around for fun and profit as long ago as 1991.
Let that sink in for just a minute: Libor was being manipulated 17 years before the financial crisis and Geithner’s babe-in-the-woods discovery of it, according to Keenan. Geithner wasn’t in charge of the New York Fed at the time, but if this was widespread knowledge years before his arrival, it makes you wonder how he could not have heard about it for so long.
Now here’s another Keenan allegation that will blow your mind. He notes that the guy running Morgan Stanley’s rate-trading desk back then was none other than Bob Diamond. Yes, the same Bob Diamond that ended up becoming Barclays CEO, only to step down because his bank manipulated Libor like most people change socks……Read more
2012-07-29 16:01:11
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