The biggest scandal rocking the financial world has to do with something you’ve probably never heard of, the LIBOR rate. It is the rate at which banks lend to each other, and it is used as the basis for an estimated $350 trillion dollars of contracts. What does it mean that Barclays has been found manipulating the LIBOR? For one, it means you might have been paying the wrong price for things like mortgages, student loans, and even the food at your grocery store–everything. Furthermore, this scandal threatens to set off a wave of litigation in the financial world.
Want to better understand the LIBOR and the implications of this story? Check out Planet Money’s excellent primer: