Despite the central bank interventions to prop up failed banks and flood the world with close to zero percent money, the London InterBank Offer Rate (LIBOR) is going back up. Almost all US Dollar denominated debt (like that owed by big US corporations and variable rate mortgages) is pegged to the LIBOR rate. If LIBOR starts to really take off again (like it did last September), the global fat lady is singing. The central banks our out of ammunition. It’s time for triage. Not eveyone is going to make it out alive.
Tags: LIBOR