It’s hard to underestimate the importance of LIBOR (London Inter-Bank Offered Rate). It is used to calculate interest rates across the global economy. And it matters to the lives of ordinary people: if you have a mortgage, insurance policy or student loan this number affects you. When I found out that traders had been manipulating LIBOR I was angry, and you should be too.
Today Bob Diamond is appearing before MPs to explain the actions of his company. The finger-pointing and blame games will continue. But there is no point blaming individual bankers for a system that is out of control. A system riddled with conflicts of interest and perverse incentives that doesn’t serve the interests of people or the economy.