Eliot Spitzer Is Willing To Suspend Judgment Before Determining Whether Or Not The New York Fed Let Barclays Molest Young Boys

Maria Bartiromo: Tim Geithner apparently flagged the problem 5 years ago. Why didn't he do more about this? He basically called the Bank of England and said he was worried about the approach in terms of Libor, that they needed to change it. Did he do enough? Eliot Spitzer: Look I think it would be preemptory to say one way or the other. This is something that needs an awful lot of examination. I think the fact that he knew in '07, sent a memo in '08 is only the first layer of inquiry. Did he follow up on it? Libor, as everyone who watches CNBC knows, is the heart and soul, it is the blood stream of the financial system. If anyone is rigging it or playing games with it then you must follow up. Anybody who is in the regulatory position that Tim Geithner was in, in my view the most important bank regulatory position in the world, how do you not follow up and say wait a minute guys what have you done? So it's unclear, and I hate to use this metaphor perhaps but was this the sort of memo that was being sent at Penn State where you just kind of brush it aside or was it really and effort to do something? MB: Oh god... ES:...This bears an awful lot of inquiry. Because it goes to the very real question of whether the NY Fed did not fulfill its fundamental function to ensure the soundest [and] security of the balance sheets of the banks all the way through the period leading up to the crisis. Is this one piece of evidence that runs contrary to that or one piece of evidence that supports it? We don't know yet. MB: What a comparison. ES: Well let me tell you Maria, unfortunately when you see memos at the top being written like that, you never know, you have to ask the question, what preceded it, what came after it, otherwise you don't understand the texture of what was being done by that senior person. Spitzer Talks Wall Street [CNBC]
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Maria Bartiromo: Tim Geithner apparently flagged the problem 5 years ago. Why didn't he do more about this? He basically called the Bank of England and said he was worried about the approach in terms of Libor, that they needed to change it. Did he do enough?

Eliot Spitzer: Look I think it would be preemptory to say one way or the other. This is something that needs an awful lot of examination. I think the fact that he knew in '07, sent a memo in '08 is only the first layer of inquiry. Did he follow up on it? Libor, as everyone who watches CNBC knows, is the heart and soul, it is the blood stream of the financial system. If anyone is rigging it or playing games with it then you must follow up. Anybody who is in the regulatory position that Tim Geithner was in, in my view the most important bank regulatory position in the world, how do you not follow up and say wait a minute guys what have you done? So it's unclear, and I hate to use this metaphor perhaps, but was this the sort of memo that was being sent at Penn State where you just kind of brush it aside or was it really an effort to do something?

MB: Oh god.

ES: This bears an awful lot of inquiry. Because it goes to the very real question of whether the NY Fed did not fulfill its fundamental function to ensure the soundest [and] security of the balance sheets of the banks all the way through the period leading up to the crisis. Is this one piece of evidence that runs contrary to that or one piece of evidence that supports it? We don't know yet.

MB: What a comparison.

ES: Well let me tell you Maria, unfortunately when you see memos at the top being written like that, you never know, you have to ask the question, what preceded it, what came after it, otherwise you don't understand the texture of what was being done by that senior person.

Spitzer Talks Wall Street [CNBC]

Related

RBS Trader Whose Instant Messages Clearly Show Him (Allegedly) Engaging In Libor Manipulation Not Going Down Without A Fight

One thing that most people probably agree on is that having their instant messages, e-mails, and phone calls end up court would be cause for at least a little embarrassment. Everyone's thrown in an emoticon they aren't proud of, some of us have used company time to chat with significant others about undergarments, and the vast majority of workers have spent a not insignificant amount of the workday talking shit about their superiors. Of course, the humiliation gets ratcheted up a notch in the case of people who 'haha' (and in extreme circumstances "hahahah') their own jokes* which, just for example, involve habitual Libor manipulation. Tan Chi Min knows what we're talking about: “Nice Libor,” Tan said in an April 2, 2008, instant message with traders including Neil Danziger, who also was fired by RBS, and David Pieri. “Our six-month fixing moved the entire fixing, hahahah.” And while having such an exchange become public would be tremendously awkward for most, you know what's really 'hahaha' about this whole thing is that 1) Tan was the one who wanted people to read the above, which was submitted as part of a 231-page affidavit earlier this month and 2) He's trying to use it as evidence that he didn't deserve to be fired. The conversations among traders at RBS and firms including Deutsche Bank AG illustrate how the risk of abuse was embedded in the process for setting Libor, the benchmark for more than $300 trillion of securities worldwide......Tan, the bank’s former Singapore-based head of delta trading for Asia, [is] suing Britain’s third-biggest lender by assets for wrongful dismissal after being fired last year for allegedly trying to manipulate the London interbank offered rate, or Libor. Tan, who 'allegedly' tried to manipulate the London interbank offered rate, also included this conversations as part of his defense: “What’s the call on Libor,” Jezri Mohideen, then the bank’s head of yen products in Singapore, asked Danziger in an Aug. 21, 2007, chat. “Where would you like it, Libor that is,” Danziger asked, according to a transcript included in Tan’s filings. “Mixed feelings, but mostly I’d like it all lower so the world starts to make a little sense,” another trader responded. “The whole HF world will be kissing you instead of calling me if Libor move lower,” Tan said, referring to hedge funds. “OK, I will move the curve down 1 basis point, maybe more if I can,” Danziger replied. And this: In another conversation on March 27, 2008, Tan called for RBS to raise its Libor submission, saying an earlier lower figure the bank submitted may have cost his team 200,000 pounds. “We need to bump it way up high, highest among all if possible,” Tan said. Tan also asked for a high submission in an Aug. 20, 2007, instant message to Scott Nygaard, global head of RBS’s treasury markets in London. “We want high fix in 3s,” Tan said in the message. “Neil is the one setting the yen Libor in London now and for this week and next.” Also this: “It’s just amazing how Libor fixing can make you that much money or lose if opposite,” Tan said on an Aug. 19, 2007, conversation with traders at other banks, including Deutsche Bank’s Mark Wong. “It’s a cartel now in London.” And this philosophical one, for good measure: “This whole process would make banks pull out of Libor fixing,” Tan said in a May 16, 2011, chat with money markets trader Andrew Smoler. “Question is what is illegal? If making money if bank fix it to suits its own books are illegal... then no point fixing it right? Cuz there will be days when we will def make money fixing it.” The defense rests. RBS Instant Messages Show Libor Rates Skewed for Traders [Bloomberg] *Although actually people who do this probably don't even have the good sense to be ashamed of themselves.

Eliot Spitzer's Liason To The Hooker World Announces Plan To Run For Mayor Of New York

Earlier this month, the Times reported that Mayor Bloomberg and his advisers had been "floating the possibility of mayoral runs to at least five boldface figures," including Chuck Schumer, Mort Zuckerman, Ed Rendell, Edward Skyler, and Hillary Clinton. Strangely left off the list? A woman who some might say is actually Hizzoner's most worthy successor and who conveniently announced her intent to run today: Kristin Davis, the woman who once supplied Eliot Spitzer with hot young tail.