And Now The Fed Gets Dragged Into LiEborgate

via: ZeroHedge
by: Tyler Durden
July 3, 2012

As was first reported two days ago, and confirmed today, Barclays’ natural response to allegations it single-handedly manipulated the interest rate complex for up to $500 trillion notional in IR-sensitive swaps and other products (it didn’t – everyone else did it too), was to drag everyone into the scandal, starting off with the Bank of England (and about to drag Whitehall into it too), and specifically the man who was next in line for governorship of the English Central Bank: Paul Tucker. What does this mean? Well, as we suggested also two days ago, now that the natural succession path at the BOE has been terminally derailed, it brings up those two other gentlemen already brought up previously as potential future heads of the BOE, both of whom just happened to work, or still do, at… Goldman Sachs:  Canada’s Mark Carney or Goldman’s Jim O’Neil. Granted both have denied press speculation they will replace Mervyn King, but it’s not like it would be the first time a banker lied to anyone now, would it (and makes one wonder if this whole affair was not merely orchestrated by the Squid from the get go… but no, that would be a ‘conspiracy theory’.) Yet the fact that Goldman is hell bent on global domination by stretching its tentacles into every monetary policy administration is no secret: it is only a matter of time before GS also runs the English CTRL-P macros. More interesting is that in addition to the BOE, Barclays today also dragged America’s very own Federal Reserve into the fray.

Continue Reading At: ZeroHedge.com

The Central Banks’ Assault On Savers

Submitted by Tyler Durden on 03/04/2012 11:12 -0500

The Assault On Savers

The best and most basic proof that NO central bank anywhere has the best interests of the actual producing economy of their nation as their focus is the assault on savers and saving. Sustainable economic “growth” is only possible in a situation where more is being produced than is being consumed. This “surplus” is savings which are in turn the life blood of production. When savings are discouraged to the extent they have been over the course of the GFC, one can be sure that the goal of those in charge is not a REAL recovery.

In the UK, Bank of England governor Mervyn King has been apologising to British savers for years over the “necessity” to hold interest rates at non-existent levels. Apologies are all that has been forthcoming. In 2007, savings on call in UK banks attracted an already low average rate of 3.15 percent. The average rate since early 2008 has been 0.94 percent. Since the Bank of England reduced its rates to their present 0.50 percent in late 2008, that average rate has been much lower. According to a recent article in the UK Telegraph, these rates have reduced the interest on savings by at least 70 percent since 2007. This, according to the article, has been done – “to protect an enfeebled economy from outright collapse”. What it has done instead is to bring about an all but outright collapse among those who took the definition of the word “economy” seriously. It has impoverished UK savers, especially those on fixed incomes.

The situation is similar everywhere. In the US, anyone who has chosen to live within his or her means over the past four years has paid a heavy price. As is the case everywhere else, the Fed gets things precisely backwards. Their contention is that borrowing is essential for economic “health”. In reality, the ability to borrow is the RESULT of the economic health displayed by those who have savings to lend. But what the Fed and the other central banks want to “save” is not the economy, it is the financial system and the imaginary prices of financial assets which form its only foundation.

Source: ZeroHedge.com