Well done Grant.
- The Large Hadron Collidor (LHC) was built to effectively find the hypothosized Higgs boson, the god particle, at a cost of 7.5 billion dollars. They ‘think’ they’ve found it.
- Libor (London Interbank Offered Rate) on the other hand was developed as a reference rate for financial products such as syndicated and variable rate mortgages.
Libor effectively touches 800 trillion dollars, yes, 10 times the real economy. Trillion… Think stars. 10 trillion in mortgages, a trillion or two in credit card debt, and 300 + trillion in swaps, etc… Ok so where’s the Libor connection? You have a select group of large banks proposing interest rates, and the average of their propositions become Libor. Libor is the interest rate setting god particle, it’s the part of your mortgage equation which you never see, because nobody really knows what IT is. Atleast not until 11am London time, after exchanging a few emails.