Date of Award
MS - Economics
Jan Kregel, Ph.D.
The focus of this thesis will be on the policy implications surrounding the mandated transition from the London Interbank Offered Rate to Secured Overnight Financing Rate. This discussion will begin by explaining the genesis of the LIBOR in the development of the Eurodollar market. Next, this paper will present the LIBOR manipulation scandal and the effects on the financial system. An analysis of the differences between SOFR and LIBOR will provide the basis of an assessment of the impact of the change on financial institutions. Finally, the effectiveness of the SOFR as a benchmark will be evaluated, along with the changes banks need to make to conform to this new economic standard. In the end, this study concludes that there are better options than the proposed SOFR benchmark. These alternative options will facilitate more responsible growth for financial products that are pegged to benchmark rates.
Subramani, Sid MS, "Transitioning From the LIBOR" (2021). Theses - Graduate Programs in Economic Theory and Policy. 37.