Am I the only one that thinks all this fuss about LIBOR fixing is strange? Granted it was illegal and was an example of bank corruption, insider trading and so on, but it's been a long time since there was anything with even a faint resemblance to a free market in interest rates, and numerous practices that might once have been considered corrupt and dishonest have long since moved into the banking mainstream. Anyone waiting for the wave of prosecutions that should have followed the subprime fiasco has been waiting a while, and when the banks involved say that they thought that what they were doing had the tacit approval of regulators, that does at least seem possible.
Also the fixing of LIBOR has been blatant for years. I've read about it quite a few times as I recall. Is it really possible that the regulators just noticed? Granted they've won no awards for clear vision in the past, and one could be forgiven for wondering whether they need assistance to dress themselves in the morning, but it does seem hard to believe.
The bankers are really just a reflection of their regulators nowadays. The Fed and others lead by example with their colossal arrogance, their privileges for favored groups, and their fixing of every market they can influence. Small wonder that bankers feel that this sort of behavior is acceptable.
Do you think that's harsh? It isn't. Here's an example. Michael J Burry is the hero of Michael Lewis's outstanding book The Big Short, as it was he (not John Paulson who copied his idea) who first saw the huge subprime crisis coming and shorted it in a big way against widespread incredulity and opposition from his own hedge fund investors. His funds made a lot of money, though he found the process so stressful that he then closed them all down and retired.
In 2010 Burry wrote an op-ed in the New York Times entitled 'I saw the subprime crisis coming, why didn't the Fed'. Within two weeks the IRS had opened audits on all six of his closed funds and shortly thereafter the FBI opened an investigation into his activities. You can read about that here. That this sort of abuse of power can happen in the US without exciting much interest or comment nowadays says everything about the shamefully low standards of conduct of the current masters of the financial system.
On to the markets. There was a small retracement to touch 1355 SPX yesterday, and a higher high later in the day that saw SPX close again above the 100 DMA and just under the upper bollinger band:
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