Bank of England Increases QE £50BN

The Bank of England has left interest rates unchanged. However, it has increased quantitative easing by £50BN over the next four months.

The rationale for turning on the printing presses again being the persistent lack of economic growth, slowing export markets and weak business indicators.

NatWest IT Update

Despite the recent valiant attempt by Bob Diamond and Barclays to divert attention from their chums in NatWest, the NatWest IT glitch and the aftermath of that glitch continues to rumble on.

This morning NatWest sent yet another email update out to its hapless customers, subject line "Working hard to put things right":

"Dear ****,

We have fixed the underlying technical issue and are now working hard to help our customers that have been affected. I wanted to get in touch to let you know what we are doing to deliver on our promises.

Putting things right For the vast majority of our customers who have raised a concern we have resolved it straight away. Those that need more attention are being handled directly by our dedicated response team, who have so far resolved over 90% of the 21,000 cases received.

Reimbursing our customers
We made a promise that no customer will be left permanently out of pocket and we intend to keep it. We will automatically reimburse all of our customers' fees, charges and interest on their current accounts, credit cards, mortgages and loans where they have been charged or overcharged as a result of the incident.

Here to help
You can find the latest information, answers to common questions and help to resolve any outstanding queries by visiting Help Point, the dedicated area on our website. Or feel free to go into any of our branches, or call our 24/7 UK call centres free on 0800 656 9639 (minicom: 0800 404 6161).

Thank you for your understanding during this period and again we're sorry for any issues that we've caused.

Yours sincerely,


Chris Popple
Managing Director, Retail Banking "

I understand that the problems with Ulster Bank may well continue until 16 July.

Bob Diamond Speaks

Bob Diamond has just claimed that he only found out about LIBOR "low balling" at Barclays "this month".

That would be last Sunday then would it Bob?

Hmmm!

4th of July Party Prep

Hi all!  I'm writing this at 9:55 p.m. on July 3rd, after having been prepping for our little shindig for the last several hours.  I've crashed onto the couch and am so sleepy, but I think we've got everything mostly in place and only have last minute food prep to do tomorrow! :)



Since this is a "Backyard BBQ" and guests and kiddos will be out in the backyard, I'm most excited that our back patio was cleaned up this afternoon!



We've had these outdoor chairs and tables from Wal-Mart (the Better Homes and Garden Collection) for 2 years, but the buttery yellow cushions were sure showing their age- they were filthy.

My husband hosed down and soaped up the chairs, making them look good as new.  

Unfortunately, I didn't think the cushions were salvageable.  After looking around, I found new seat cushions online at Wal-Mart in a bolder, striped pattern, that I'm hoping doesn't show as much dirt.  They were only $35, and to avoid shipping charges, I picked them up at the store. My selection was limited because we needed cushions that were 22 inches, instead of the more popular 19 inches. 

I'll be back later this week sharing our party with you.

Thank you for linking up your 4th of July ideas - I'm still making my way through your posts and love seeing what y'all are up to.  You can still link up your 4th of July posts HERE. 

LIEBOR - The Essential Truth

There is much hoopla going on in the media about this afternoon's bunfight at the Treasury Select Committee hearing, where Bob Diamond will be the guest star.

All attention and focus (thanks to deft media manipulation by Barclays) is on the alleged phone call from Paul Tucker (Deputy Governor of The Bank of England) on 29 October 2008:

"Bob Diamond received a call from Paul Tucker, the Deputy Governor of the Bank of England. The substance of that call was captured by Bob Diamond via a note prepared at the time. A copy of that note is appended to this document; it was circulated to John Varley, then Barclays Chief Executive, and Jerry del Missier, then President of Barclays Capital.

Subsequent to the call, Bob Diamond relayed the contents of the conversation to Jerry del Missier. Bob Diamond did not believe he received an instruction from Paul Tucker or that he gave an instruction to Jerry del Missier. However Jerry del Missier concluded that an instruction had been passed down from the Bank of England not to keep LIBORs so high and he therefore passed down a direction to that effect to the submitters ."

This is all very well, and has given Barclays the veneer of an "excuse"; wherein it can imply that it was asked to fiddle the rates. It has also given the Tories an opportunity to unleash the hounds, and castigate various Labour ministers of the day.

However, let us not forget the essential truth, Barclays were fiddling the LIBOR rates long before the alleged phone call took place.

For why?

To make a profit for their own greedy ends, not to save the country or the bank from financial ruin.

Let us not forget that!

Barclays Dishes The Dirt and Publishes Document

Barclays have published a document ahead of tomorrow's appearance by Bob Diamond at the Treasury Select Committee.

Here are a few highlights of the full document which can be viewed here:

"Supplementary information regarding Barclays settlement with the Authorities in respect of their investigations into the submission of various interbank offered rates

Context
In anticipation of Bob Diamond’s appearance before the Treasury Committee tomorrow, 4 July, 2012, in the interest of clarity and transparency we set out on behalf of Barclays a brief summary of the salient events and the actions that Barclays has undertaken since becoming aware of them. These explanations are in no way intended to excuse any of the events that occurred. These events should never have taken place, and Barclays deeply regrets that they did....

The investigation
The bank has conducted an exhaustive internal investigation over more than three years supported by external counsel. The bank has reviewed 22 million documents from over 200 custodians, over 1 million audio files and conducted more than 75 interviews. The results of the reviews were shared with the Authorities, who in turn made their own requests for documents and interviews.

In total, the bank has invested nearly £100m to ensure that no stone has been left unturned. The bank’s exceptional level of cooperation was expressly recorded by each of the Authorities, and was described by the DoJ as “extraordinary and extensive, in terms of the quality and types of information provided” and ”the nature and value of Barclays cooperation has exceeded what other entities have provided in the course of this investigation.”

That cooperation has led to Barclays being the first to reach resolution of these issues. It ironic that there has been such an intense focus on Barclays alone, caused by our being first to settle in the midst of an industry-wide, global investigation.....

29 October 2008 Communication from Bank of England
During October 2008, in the wake of the collapse of Lehman Brothers, when liquidity conditions had tightened acutely, Barclays raised its US Dollar LIBOR submissions more significantly than other panel members. In the month of October 2008, in particular, Barclays US Dollar LIBOR submissions for the 3 month maturity were the highest or next highest of the panel on every single day of the month and therefore excluded from the calculation of LIBOR.

Barclays did not understand why other banks were consistently posting lower submissions; Barclays firmly believed that the other panel members were not, in fact, funding at a lower cost than Barclays, and we were disappointed that no effective action was taken, notwithstanding our having raised these issues with various Authorities during the whole financial crisis period as outlined in the attached timeline.


As one would expect, Barclays (including Bob Diamond and Jerry del Missier) was in close contact with the Bank of England and other Authorities about the liquidity crisis generally.

On 29 October 2008, Bob Diamond received a call from Paul Tucker, the Deputy Governor of the Bank of England. The substance of that call was captured by Bob Diamond via a note prepared at the time. A copy of that note is appended to this document; it was circulated to John Varley, then Barclays Chief Executive, and Jerry del Missier, then President of Barclays Capital.


Subsequent to the call, Bob Diamond relayed the contents of the conversation to Jerry del Missier. Bob Diamond did not believe he received an instruction from Paul Tucker or that he gave an instruction to Jerry del Missier. However Jerry del Missier concluded that an instruction had been passed down from the Bank of England not to keep LIBORs so high and he therefore passed down a direction to that effect to the submitters.


There was no allegation by the Authorities that this instruction was intended to manipulate the ultimate rate. The bank’s submissions had consistently been excluded from the LIBOR calculation. Moreover the instruction became redundant in a matter of days as market conditions improved.


The FSA investigated Jerry del Missier personally in relation to these events and closed the investigation without taking any enforcement action.


Chronology of key issues
A. 2005 to 2009 – Trader requests

.....During this period, Barclays was consistently raising concerns with the BBA, questioning why other banks’ LIBOR submissions appeared to be so high compared to those of Barclays. Many of these concerns were based upon Barclays observations that other banks were making submissions which were lower than levels at which they appeared to be undertaking transactions. ......


Barclays also raised concerns with the FSA, the Bank of England and the US Federal Reserve. The documented occasions on which Barclays made such contact are illustrated in the attached document Timeline of regulatory contact..."

Bob Diamond's Payoff

Despite the fact that Bob Diamond resigned from Barclays, it seems that he is in line for a payoff.

Some are speculating it will be between £20M-£30M.

Any bets anyone?