Hat tip Bianco Research

 

 

Category: Legal

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

7 Responses to “Barclays Quant Analysis of Libor”

  1. Frwip says:

    Their ‘quantitative analysis’ smells like a nice case of ” numerical hierophancy “, the use of big complicated scary incomprehensible pseudo-mathematics in furtherance of apologetics.

    ( hierophancy : 1) The function of a hierophant; capacity of expounding sacred mysteries 2) Modern economic theories, see also DSGE )

  2. philipat says:

    This one’s for you Big Boy. I’ll be over later for the Bollinger.

  3. Rich_S says:

    But the systematic rigging of LIBOR by management was not until October of 2008.

    See the ‘file note’ here:
    http://www.totalpolitics.com/print/324177/live-paul-tucker-at-the-treasury-committee.thtml

  4. [...] Libor: carry on, there’s nothing empirically noticeable here. (Barclays quant paper from [...]

  5. mathman says:

    Here’s another analysis you might want to read in your spare time:

    http://www.feasta.org/2012/06/17/trade-off-financial-system-supply-chain-cross-contagion-a-study-in-global-systemic-collapse/
    (from the prelude to the actual paper)

    “Overview
    This study considers the relationship between a global systemic banking, monetary and solvency crisis and its implications for the real-time flow of goods and services in the globalised economy. It outlines how contagion in the financial system could set off semi-autonomous contagion in supply-chains globally, even where buyers and sellers are linked by solvency, sound money and bank intermediation. The cross-contagion between the financial system and trade/production networks is mutually reinforcing.

    It is argued that in order to understand systemic risk in the globalised economy, account must be taken of how growing complexity (interconnectedness, interdependence and the speed of processes), the de-localisation of production and concentration within key pillars of the globalised economy have magnified global vulnerability and opened up the possibility of a rapid and large-scale collapse. ‘Collapse’ in this sense means the irreversible loss of socio-economic complexity which fundamentally transforms the nature of the economy. These crucial issues have not been recognised by policy-makers nor are they reflected in economic thinking or modelling.

    As the globalised economy has become more complex and ever faster (for example, Just-in-Time logistics), the ability of the real economy to pick up and globally transmit supply-chain failure, and then contagion, has become greater and potentially more devastating in its impacts. In a more complex and interdependent economy, fewer failures are required to transmit cascading failure through socio-economic systems. In addition, we have normalised massive increases in the complex conditionality that underpins modern societies and our welfare. Thus we have problems seeing, never mind planning for such eventualities, while the risk of them occurring has increased significantly. The most powerful primary cause of such an event would be a large-scale financial shock initially centring on some of the most complex and trade central parts of the globalised economy.”

    (there’s more followed by a link to the actual paper with the details)

  6. 873450 says:

    Crime looked at from a great distance is hard to see.

    If we want to catch robbery teams preying on 1 million drunks in Times Square on New Years Eve, we assign teams of undercover detectives, some baited out posing as drunks with money hanging out of their pockets, to scope out robbery teams, follow them around and catch them in the act. When robbers are arrested, we prosecute and send them to prison, sometimes permanently, effectively removing them from society to prevent them from committing more crimes.

    If we don’t want to catch the robbers, we assign one team of desk job geek detectives to sit in a room miles away from Times Square looking at video screens depicting satellite transmissions of the event. The next day we deliver satellite images to news media saying, “Here are 1 million drunks celebrating in Times Square. Our high skilled, hi tech investigators looked at all of them all night long and did not detect any indication of criminal activity. Muppets were never in danger. Satellite transmissions dispensed with unnecessarily assigning hundreds of officers onsite, saving taxpayers a ton of money on overtime pay. Very few crimes were reported and no arrests were made. Aren’t we smart?”

    Brilliant work quants!

    Now look closer at incriminating email and follow that trail of dirty $$$.

  7. Jim Bianco says:

    Rich_S:

    Wrong!

    It started as earlier as 2005, was noticeable in 2007, and was the talk of the markets in April 2008 (a month after Bear blew up) which prompted Barclays note at that time.

    http://professional.wsj.com/article/SB120831164167818299.html?mod=hps_us_whats_news&mg=reno64-wsj