Jim Grant Discusses The Fed's 'Backward Shooting Gun', And Black Walnut Tree Treasury Replacements

Yesterday, when discussing the forthcoming implications of the Libor scandal, we said that in the barrage of coming lawsuits, "the entity that will be sued by proxy is the Federal Reserve, whose Federal Funds rate is really the setter for the baseline Libor rate." This claim came at an opportune time, just hours before one of the Fed's most vocal critics (andgold standard advocates), Jim Grant, appeared on TV to discuss precisely the same thing. Best summarizing his position is a cartoon that appeared in a recent issue of Grant's Interest Rate Observer in the context of Lieborgate, and who is really at fault here.

                                    

The banks fixed Libor. The Fed fixes rates. The banks do this surreptitiously and opportunistically. the Fed does it for a living.....

                            ................ Tyler Durden