No, seriously people.
By now, it should be clear that the current mechanisms designed to
inform markets what banks charge each other to borrow—the London interbank
offered rate being chief among them—are broken. Benchmarks such as Libor that
rely on subjective assessments made by interested parties—regardless of any
potential wrong-doing—simply cannot accurately reflect market realities.
What might a better system look like? We know the preferred
attributes: accuracy, transparency, impartiality and data-based objectivity.
The questions are how these goals can be realized: What would the inputs be,
and which institutions would be surveyed?
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