Last Wednesday the Wall Street Journal reported that the Big Banks may be under-reporting the LIBOR Rate  

The Wall Street Journal reports on another sign of how bad the credit crunch has gotten: banks fudging on what they are reporting as their short-term cost of interbank borrowing, out of fear of revealing how stressed they are.

(I'd cite the WSJ but their cite is mostly subscription only.)

Now why should you care?

The Journal mentions another consequence, that Libor-indexed borrowers are getting a better rate than they deserve. But it misses an implication that is ultimately more serious: as more and more statistics and benchmarks come into doubt, it creates uncertainty and undermines planning, which in turn is a deterrent to investment.

This post is also on my blog.  I will update it throughout the day as events develop.  Any further updates from the trading day will be on my blog.

There were some fast moving developments in the Bear Stearns situation.

Pushed to the brink of collapse by the mortgage crisis, Bear Stearns Cos. agreed -- after prodding by the federal government -- to be sold to J.P. Morgan Chase & Co. for the fire-sale price of $2 a share in stock, or about $236 million.

At least a thousand times I've seen an article mix up billions with millions. Reuters ramped it up 1000x by giving Countrywide a $1.48 billion loan servicing portfolio. To make up for that, they gave  excessive precision:

Countrywide said borrowers were delinquent on 33.64 percent of subprime loans it serviced as of December 31, up from 29.08 percent in September

without mentioning how much of the total portfolio is subprime.

Simple, yes, but reporting on the Big Mess has had plenty of substantive confusion.

Consuming Our Way to Unhappiness. 2001 was the year of the discovery that billions of world citizens had embarked on a runaway train whose destination is still unknown, up to this very day. Maybe has the time come to embrace The Teachings of Buddhabot?