Author Topic: Bankers: At It Again  (Read 923 times)

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Offline Colwyn

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Bankers: At It Again
« on: November 12, 2014, 13:50:43 PM »
Over the last year or so bankers have become more confident in their criticism of the general public. They complain that banks have been wrongly castigated for causing the financial crash of 2007-08. They protest that public are motivated by envy when attacking their bonuses. They demand that being paid eye-wateringly huge piles of cash is a necessary feature of good banking performance since only the very best, those of internationally outstanding ability, are required to caary out banks' highly technical financial activities. Ss such, not only is super-pay economically necessary, it is also morally justified. Overall, they portray themselves as having learned from the errors of the past and that they can now be trusted. Bashing-the-bankers should stop. Are you convinced?

Today five banks have been fined £2bn by UK and US regulators. This time they have been found guilty of conspiring to rig the international currency markets in order defraud their own clients. What their traders had done, and must have known by their superiors, was to set up a gang of traders from different banks. They shared information on what their clients had ordered - say, buying large amounts of £. Traders would begin buying the £ in small amounts during the day at (low) market rate.  They then put in a sudden, coordinated pile of orders just before 4.00pm to make a peak in the demand for £s and thus push the market rate artificially high for a few minutes. Why 4.00pm? Because official daily rates are set in the 30 seconds before of after 4.00pm. They could then supply the cheap £s they bought earlier in the day to their clients at the artificially high official rate. This 4.00pm rate setting is known as "the fix"; quite.

So these Forex traders bought £s when the price was low knowing that they could sell later in the day when their gang would push it higher. Nice little profit; thank you very much. A regulator spokesperson said that bank traders would have to learn that the old culture won't do today. "Culture"? It is not bloody "culture". It is criminality. Grrrr.



Offline KKOB

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Re: Bankers: At It Again
« Reply #1 on: November 12, 2014, 14:05:30 PM »
I can't understand the logic of the "fines". The RBS is being "fined" £217m. They're owned by the UK taxpayer. Who's pocketing the "fine" ?

Offline Colwyn

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Re: Bankers: At It Again
« Reply #2 on: November 12, 2014, 14:14:37 PM »
I agree. Even with the banks we don't own the fines won't make much, if any, difference. They will just be written off as a "business expense"; just one of the costs of carrying out business; possibly being set off against tax. The banks won't even be embarrassed by it. Just a perfunctory nod in the direction of an apology, muttering about a "tiny handful of bad apples", a shrug of the shoulders and back to business as usual. High time some of these bankers saw the inside of a gaol cell. That might make an impression on the others.

Offline kevin3

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Re: Bankers: At It Again
« Reply #3 on: November 12, 2014, 14:57:42 PM »
Yet another bloody Cartel to add to
Oil companies
Energy companies

Market forces my a##e.




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