The London Interbank Offered Rate (Libor) and the Euro Interbank Offered Rate (Euribor) are two key market benchmark interest rates used in a plethora of financial contracts with notional amounts running into the hundreds of trillions of dollars. The integrity of the rate-setting process for...

The investigations into LIBOR have highlighted that it is subject to manipulation. We examinea new method for constructing LIBOR that produces an unbiased estimator of the true rate.LIBOR itself is based solely on transactions. We allow for fines when a bank's transaction isdifferent than a...