Enlightening interview with Caitlin Long caitlinlong (npub1uyz…8632) :
https://podcasts.apple.com/us/podcast/gold-goats-n-guns-podcast/id1435023391?i=1000607983738
SOFR is a *secured* overnight rate, LIBOR was unsecured.
SOFR is tied to a collateral, typically to a government guaranteed short term instrument such as TBill.
Unsecured LIBOR was tied to the default risk of the banks.
In ‘08, there was just one US bank that was the part of the LIBOR panel. In effect, in 2008 we saw the onshoring of the over-leveraged European banks credit risk to the US economy—and the mechanism was through LIBOR over which the FED had effectively no control.
Aava
npub136…huvc3
2023-04-08 20:10:33
Author Public Key
npub1365l7zk4szr37eq976erx3qmuev8epu96hsa0eclweljxhc3dxqsghuvc3Published at
2023-04-08 20:10:33Event JSON
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"content": "Enlightening interview with Caitlin Long #[0] :\n\nhttps://podcasts.apple.com/us/podcast/gold-goats-n-guns-podcast/id1435023391?i=1000607983738\n\nSOFR is a *secured* overnight rate, LIBOR was unsecured.\nSOFR is tied to a collateral, typically to a government guaranteed short term instrument such as TBill. \nUnsecured LIBOR was tied to the default risk of the banks. \n\nIn ‘08, there was just one US bank that was the part of the LIBOR panel. In effect, in 2008 we saw the onshoring of the over-leveraged European banks credit risk to the US economy—and the mechanism was through LIBOR over which the FED had effectively no control.",
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