Don't axe Libor,make it better

摘要

Libor has been under attack since June last year, when Barclays was fined $450m for its manipulation of the rate. But few criticisms have been as stringent as those of Gary Gensler, the influential head of the US Commodity Futures Trading Commission. He said last month that Libor, a global benchmark to which perhaps $800,000bn of financial products are referenced, was "unsustainable" and should be replaced. He claimed that Libor was flawed because it was often based on banks' estimates of the rates at which they can borrow, rather than actual trades. "I don't now how a rate that purports to measure a market can continue when that market doesn't exist," he said.