This morning's key headlines from
- Barclay's COO admits having rigged Libor, thought it was OK
- Russia accuses the West of 'blackmail' on Syria
- Germany's Angela Merkel denies caving in on Spain's bank bailout
Barclay's COO admits having rigged Libor, thought it was OK
Jerry del Missier, testifying on Monday (Bloomberg)
The former chief operating officer of Barclays Bank received a
dramatic drilling on Monday in front of the British Parliament's
Treasury Select Committee. Under close questioning, Jerry del Missier
said that he had given instructions to Barclays' money market traders
to manipulate interest rates in 2008, after he interpreted a message
from the Bank of England as an instruction to do so. The Bank of
England, as well as del Missier's boss Bob Diamond, have said there
was no such instruction. (See "4-Jul-12 World View -- Barclays interest rate manipulation prompts desperate finger-pointing by British officials"
During the hearing, del Missier was asked several times whether he
believed that these rate-fixing actions were legal or illegal. He
refused to answer, saying that the actions were perfectly OK, given the
context of the time. The Libor fixing scandal is drawing increased
attention as more banks are investigated, because Libor is the
benchmark interest rate used in the pricing of some 1/3 of $1
quadrillion in financial instruments worldwide, so even a small change
in the Libor rate can affect trillion of dollars in securities.
Russia accuses the West of 'blackmail' on Syria
Russian Foreign Minister Sergei Lavrov accused the West of "blackmail"
in the United Nations Security Council. Security Council
authorization for Kofi Annan's "Syria peace plan" observer mission,
which has only increased violence in Syria because it provides an
excuse for the Bashar al-Assad regime to exterminate even more
innocent Sunni Arab civilians, expires on July 20. The British text
for a new resolution extends the observer mission, but it also
authorizes "Chapter 7" military enforcement, which Russia refuses to
endorse. According to Lavrov,
"To our great regret, there are elements of
blackmail. We are being told that if you do not agree to passing
the resolution under Chapter 7 of the U.N. Charter, then we shall
refuse to extend the mandate of the monitoring mission.
We consider it to be an absolutely counterproductive and dangerous
approach, since it is unacceptable to use monitors as bargaining
The issue is becoming even more heated, as there are some unconfirmed
reports that al-Assad is planning to begin using chemical weapons.
Meanwhile, the UN's wandering Gypsy, Kofi Annan, will visit Moscow on
Tuesday for some reason or other.
Germany's Angela Merkel denies caving in on Spain's bank bailout
The question is still unresolved whether the European Commission lied
when officials said that the 100 billion euro bailout of Spain's banks
had to be guaranteed by Spain's government, in case the banks can't
repay the bailout loans. The first announcement was that German
Chancellor Angela Merkel had caved into pressure from Spain and Italy,
and had agreed that Spain would NOT have to guarantee the loans. Then
that the European
Commission had lied, and that Spain WOULD have to guarantee the loans.
Now Merkel is saying that she did NOT cave in to the demands of Spain
and Italy, and that it hadn't yet been decided whether the bank loans
would have to be guaranteed by Spain.
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