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LIBOR Credibility in Doubt

Posted on May 15, 2008

Bloomberg is reporting Libor Poised for Shake-Up as Credibility Is Doubted.Thebenchmark interest rate for $62 trillion of credit derivatives andmortgages for 6 million U.S. homeowners faces its biggest shakeup in adecade as lawmakers question if banks are understating borrowing costs.Forthe first time since 1998, the British Bankers' Association isconsidering changing the way it sets the London interbank offered rate,according to Chief Executive Officer Angela Knight, who appeared beforea parliamentary committee in London today. We've put Libor underreview,'' Knight said in an interview yest...

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