The picture above shows the fall of Barclays stocks on June 29, 2012. The loss was about 3 billion pounds, which is about $4.7 billion US. Not quite the losses of JP Morgan, but, the final word probably is not in on this either.
Below is Barclays stock price over the past three months.
The banks may believe they are in familiar territory, but, they've never had the volume of liquid assets before which they have today. Their cash holdings are significant since the bailout and the quantitative easing, etc. The banks are run by people and people are not computers, they cannot control the outcome of the computers dominating the financial sector. We saw this dramatically with JP Morgan.
Barclay's decided it was above the law since they had so much money their excess takings would never be found. Evidently, absolute power corrupts absolutely. The bankers are unable to control their own infrastructure and impulses. Evidently, the world needs them more than they need us.
Britain's biggest banks are facing the prospect of criminal investigations, enormous fines and civil lawsuits from customers over the developing scandal of rigging interest rates.
The Prime Minister urged banking regulators to use "all the powers at their disposal" to pursue Barclays after it was fined £290m for manipulating bank lending rates. "This is a scandal. It is extremely serious. They've had a very large fine and quite rightly. But frankly the Barclays management team have some big questions to answer," David Cameron said. "How did this happen? Who was responsible? Who's going to be held accountable for it?"...
The chart below is from 2009 (click title to entry - thank you). It shows the assets of the world's 50 biggest banks. The pale sky blue color is the United Kingdom and Barclays is among the largest.
Barclays was fixing interest rates. There is a system in the UK whereby a daily interest rate is set. The system is called London Interbank Offered Rate also known as "Libor." It is a system where the major banks determine the interest rate of the day. Barclays was cheating and taking money from customers. The banks are going to be investigated now. This is different from Morgan's Folly. It is actually against the law in the UK.
I sincerely believe the banks are too big to manage. Morgan was floundering for a month before advisers found the problem. If a bank does not have the 'in house talent' to understand what is occurring, how can they say they are a secure commodity in the market place? The banks think they know what they know, but, the fact over and over is proving they are unwieldy. While Morgan is too big to fail by its sheer size, it is too big to manage.
The question arises; if a bank has enormous assets should it be allowed to freewheel the market places of the world knowing it can sustain a blow in the billions US? I don't abide by the idea Romney stated as justifiable, "The money went somewhere." I do believe that attitude demonstrates clearly the ego of those whom believe they are in control of the assets of their companies.
There are problems.
The USA Republicans would call it liberty. Liberty isn't about playing with fire. While US Republicans would see the JP Morgan Folly as none of the government's business; Morgan or Barclays don't print their own money yet. The activities and monetary policy and value is the business of the government. Absolutely. When Morgan and Barclay have their own sovereign nations, they can do as they please.
The USA Republicans would call it liberty. Liberty isn't about playing with fire. While US Republicans would see the JP Morgan Folly as none of the government's business; Morgan or Barclays don't print their own money yet. The activities and monetary policy and value is the business of the government. Absolutely. When Morgan and Barclay have their own sovereign nations, they can do as they please.
