July 3, 2013
The European Commission (EC) has identified 13 major financial institutions as having blocked exchanges’’ access to ensure lucrative returns on the credit derivatives market.
As an investigation gets underway, those technocratic corporations suspected of rigging lending benchmarks (such as LIBOR and EURIBOR) are:
• Bank of America
• Merrill Lynch
• Bear Stearns
• Morgan Stanley
• Credit Suisse
• Deutsche Bank
• JP Morgan & Chase Co
• Wells Fargo
• Societe Generale
• Crédit Agricole
• Goldman Sachs
• International Swaps and Derivatives Association (ISDA)
From 2006 – 2009, these institutions are charged with stonewalling the Deutsche Borse and Chicago Mercantile Exchange (CME) from participating in the credit default swaps (CDS) .
CDS are worth an estimated $13 trillion in 2013 alone. This scheme allows technocrats to bet on whether or nation or corporation will default on their bonds.
Essentially, the CDS are a Vegas-style casino for the upper echelon of banking Elite.
With the impression of transparency, the EC assumes that regulatory efforts will force those participating in the CDS casino gambling into a level of trust for business to be conducted.
Joaquin Almunia, competition commissioner for the EU said in a statement: “It would be unacceptable if banks collectively blocked exchanges to protect their revenues from over-the-counter trading of credit derivatives. Over-the-counter trading is not only more expensive for investors than exchange trading, it is also prone to systemic risks.”
Almunia stressed: “Exchange-trading of credit derivatives improves transparency and market stability. But the banks acted collectively to prevent this from happening. They delayed the emergence of exchange trading of these financial products because they feared that it would reduce their revenues. This, at least, is our preliminary conclusion. If confirmed, such behavior would constitute a serious breach of our competition rules.”
The ISDA revealed: “As previously stated, ISDA is confident that it has acted properly at all times and has not infringed EU competition rules. ISDA is co-operating fully with regulatory authorities.”
Most of the technocratic institutions declined to cooperate with data forthcoming to the ISDA; while a hand full provided information on this “over-the-counter trading”.
The CDS scheme is “used as a hedge against the credit risk associated with holding debt instruments or as a bet on the future creditworthiness of a debt issuer. Trading in the instruments is conducted over the counter, and is controlled by banks that act as middlemen to facilitate transactions.”
This pomp and ceremony has no true consequences as those technocratic institutions who are found guilty “could be prohibited from engaging in the anti-competitive behavior or face fines that total 10% of their overall global turnover.”