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I'll -- ahead lineup on their side meantime colonel charges could be on the -- criminal charges against big US banks.
-- that Barclays rate fixing scandal but our next guest says regulators clearly share some of that blame.
Mark Calabria of the Cato Institute marking -- from the start when I saw this the first thing I published.
These guys got together is conspired to make trillions of dollars.
But really it looks like this is a a growth out of the meltdown.
And -- how low ball and interest rates 'cause they were afraid of creating more panic if people realized how high the interest rates these banks were charging each other what do you say.
There's absolutely degree that I guess -- you start with obviously the responsibility for maintaining -- correctly with the banks that report.
And I think you need to separate out that the the goings on into different periods.
During the crisis -- seem to be a coordinated effort to suppress Libor for that reason seating -- panic in the markets and of course it would like the regulators winked and nodded.
Which also had instances pre financial crisis 20052006.
Will it look like at least Barclays derivatives traders were helping to manipulate -- for their own benefit.
I think it's important distinguish between those two episodes.
But of course we need to find out you know the Federal Reserve Chairman Ben Bernanke's appear before congress Tuesday Wednesday of this week.
So far does look like -- New York fed knew something was going on 2008.
But what exactly the Fed board no I think we need to get the bottom of the -- To what extent that they.
Differences of Bank of England seems like it might have actually encouraged to suppression of Libor rates.
The Federal Reserve do that as well so I think we need to get to the bottom that we need to get more information on what the regulators say when and where what do they say what we saw the story.
What more should the New York -- have done in oh wait when I first saw this -- couldn't afford to do that given the meltdown I imagine that bigger things that worry about.
I think that's a reasonable point to ask even if you saw problems here resist the first thing you should prioritize and certainly I'm sympathetic to saying they're bigger issues going on.
That doesn't mean that the Federal Reserve is particularly New York was powerless for reduces -- New York Federal Reserve.
Overseas the primary dealers and interacts with in terms of monetary policy.
So of course the Federal Reserve -- New York could have said you need to set up internal controls to make sure that what's your reporting is appropriate.
And I think that's -- what -- -- to do this because if you're internal controls in your Libor reporting is messed up.
Your internal controls and other areas -- also probably messed -- and insufficient.
So having that.
It again that New York Federal Reserve claims that it regulates and monitors the primary dealers which are you know our largest investment bank some of our commercial banks.
These primary -- -- crucial for the conduct of monetary policy is well you need to make sure that their function appropriately OK so.
-- certainly I don't think in New York Federal Reserve could have fixed everything that's wrong with Libor.
But it certainly could improve the content -- in internal controls with institutions in which -- oversee.
All right nicely done thank you very much mark Calabria -- of Cato Institute.
We want to bring you more on the breaking news Friday -- -- bringing to you throughout the hour on fox business' story coming out of the Persian gulf Fox News confirming that a US ship fired.
On a boat off the coast of Dubai to senior US defense officials telling Fox News.
The US navy ship call that a panic is a large civilian operated US navy oil tanker there's a picture for -- -- your screen.
The US defense official telling Fox News the ship fired quote disabling shots on a small vessel in the Persian gulf region after several warnings.
No confirmation on who's operating a small but whether or not it was a military vessel but it's important to note.
In this region you're talking about being very close the Strait of Hormuz this is close to Iran.
A -- is known.
To deploy small fast boats that got a history of harassing US navy ships in the regions and if that happens there obviously is maybe taking that is very seriously yeah sure -- in the discussion not a message that navy -- -- Ford announcing a big.