Barometer of Fear: An Insider's Account of Rogue Trading and the Greatest Banking Scandal in History

by Alexis Stenfors

Overview

The LIBOR affair has been described as the 'biggest banking scandal in history', a deception affecting not only banks but also corporations, pension funds and ordinary people.

But was this just the tip of the iceberg? Was the scandal the work of a few 'bad apples' or an inevitable result of a financial system rotten to its core? Labelled 'one of the world's most infamous rogue traders' in the wake of a mis-marking scandal, Alexis Stenfors went on to rebuild his life and now guides us through the shadowy world of modern banking, providing an insider's account of the secret practices - including the manipulation of foreign exchange rates - which have allowed banks to profit from systematic deception. Containing remarkable and often shocking insights derived from his own experiences in the dealing room, as well as his spectacular fall from grace at Merrill Lynch, Barometer of Fear draws back the curtain to a realm that for too long has remained hidden from public view.

Product Details

ISBN-13:	9781783609284
Publisher:	Bloomsbury Academic
Publication date:	05/15/2017
Pages:	336
Product dimensions:	5.10(w) x 7.80(h) x 1.10(d)

About the Author

Alexis Stenfors spent 15 years as a trader at HSBC, Citi, Crédit Agricole and Merrill Lynch. In 2009, he found himself at the centre of a 'mispricing' scandal which would eventually result in him being described as one of the 'world's most infamous rogue traders'. He is currently Senior Lecturer in Economics and Finance at Portsmouth Business School.
Alexis Stenfors spent 15 years as a trader at HSBC, Citi, Crédit Agricole and Merrill Lynch. In 2009, he found himself at the centre of a 'mispricing' scandal which would eventually result in him being described as one of the 'world's most infamous rogue traders'. He is currently Senior Lecturer in Economics and Finance at Portsmouth Business School.

Table of Contents

Acknowledgements vii

Abbreviations ix

Introduction: 'It's a misunderstanding' 1

1 The barometer of fear 17

2 'Why did you do it?' 56

3 Superheroes and beauty pageants 70

4 The LIBOR illusion 107

5 The value of secrets 154

6 Conventions and conspiracies 187

7 Rotten apples 235

8 The perfect storm 275

Glossary 287

Notes 293

Bibliography 299

Index 314

Editorial Reviews

"The most shocking element of Stenfors's new book is that it confirms that the economic crisis, which was effectively created by the banks, did very little to make the banks address their bad habits." --Guardian

"[Stenfors] has written a beautifully literate, Jonathan Swift-referencing book about the dark side of the City and in particular Libor, the London interbank offered rate that was once dubbed the "barometer of fear"." --The Times

"A searingly honest account of the activities of traders in the world's global markets, written in an accessible style by a brilliant, but touchingly human trader who found himself at the very vortex of the great financial crisis. Barometer of Fear offers deep insights in to the workings of the machinery that is the global financial system." --Ann Pettifor, author of The Production of Money and Just Money: How Society Can Break the Despotic Power of Finance

"A fascinating insight into the culture of modern banking and the psychology of risk taking on the trading floor." --John Plender, Financial Times columnist

"Stenfors uncovers how unregulated finance operates, or more precisely how traders think. He exposes a system out of control, incapable of self-restraint, nourishing rogue behaviour and ready to burst again at any time." --Paul Dembinski, Observatoire de la Finance

From the Publisher

“A fascinating insight into the culture of modern banking and the psychology of risk-taking on the trading floor.

Financial Times

“A searingly honest account of the activities of traders in the world's global markets, written in an accessible style by a brilliant, but touchingly human trader who found himself at the very vortex of the great financial crisis. Barometer of Fear offers deep insights in to the workings of the machinery that is the global financial system.“

Ann Pettifor

Stenfors uncovers how unregulated finance operates, or more precisely how traders think. He exposes a system out of control, incapable of self-restraint, nourishing rogue behaviour and ready to burst again at any time.

Paul Dembinski

A fascinating insight into the culture of modern banking and the psychology of risk-taking on the trading floor.

Financial Times

The most shocking element of Stenfors’s new book is that it confirms that the economic crisis, which was effectively created by the banks, did very little to make the banks address their bad habits.

Guardian

[Stenfors] has written a beautifully literate, Jonathan Swift-referencing book about the dark side of the City and in particular Libor, the London interbank offered rate that was once dubbed the “barometer of fear.’

Times

07/01/2017
Stenfors's (economics, Univ. of Portsmouth, UK) book is a detached mea culpa for the global financial crisis of the early 2000s. Stenfors, who was a Merrill Lynch currency trader in London, cost his employer $100 million via misplaced bets. He tried to cover his tracks, then told his boss the truth while he was on vacation. He was barred from the industry for five years and cooperated with authorities. This book is the author's attempt to explain what happened and to clear his reputation as a "rogue trader." He says he was caught up in a competitive culture of greed among major banks to rig the financial market, and as a high achiever, was merciless toward underperforming colleagues. Reading like an expanded doctoral dissertation, detailing the author's reflections and providing a finance primer, this is not the all-encompassing overview of David Enrich's The Spider Network. To its credit, there's a glossary of financial terms and solid explanations of London Interbank Offered Rate (LIBOR) and financial derivatives. VERDICT Readers should start with Enrich's book, then read this volume for one player's inside account. Recommended for financial professionals and scholarly audiences.—Harry Charles, St. Louis

Library Journal