asterisk2a + adamsmith + economic-thought   2

Libor affair shows banking’s big conceit - FT.com
http://www.ft.com/indepth/libor-investigation

[LIBOR scandal exposes] a big conceit at the very heart of the modern banking world.

Most notably, in recent decades large investment banks in the City of London and Wall Street have increasingly wrapped their activities with an evangelical adherence to the rhetoric of free markets; whenever they have wanted to justify
sky-high profits, wacky innovations or, most recently, the need to prevent a new regulatory drive, they have invariably cited the ideals of Adam Smith.

[...]

[T]he real issue was that Libor was never organised as a proper market in the first place, which is precisely why the manipulation continued unchecked on such a wide scale for so long.

[...] the market has been dominated by a small clique of powerful banks, which also controlled the BBA.
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june 2012 by asterisk2a

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