The last time we saw a rise in the LIBOR it went from 10 to 40 and then sat there for nine months. And then in exploded to 150 in one trading day and almost instantaneously banks stopped lending to each other, the global economy ground to a halt and we plunged into the GFC.
I mention this only because LIBOR gained 10 points last night, and there’s no garauntee it’ll wait 9 months before moving again, like it did last time.
Coupled with Spain’s possible default (although no one dare utter that on the trading floor), Chinese unwillingness to stop their huge growth, possible ware in Korea – where America has 28,000 troops and Kim Jong Il reportdedly have over 1 million, things are shaping up to be a pretty tense week.
Incidentally both Kim Jong Il and Barack Obama warned their troops that they should get ready for war. I’m sure that’s just a cooincidence.