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They say the only time the British consider themselves European is during the Ryder cup. Also perhaps, when reading the Wall Street Journal:

Libor Hits US Borrowers

The troubles of banks in Europe are pushing up an interest rate widely used in the U.S., prompting the idea of a U.S.-based alternative to that rate, known as the London interbank offered rate, or Libor… That means the financial difficulties of European banks are having an outsized effect on U.S. borrowing costs.

This whole banking crisis. Utterly our fault chaps.

For those who missed it, London is also to blame for SIVs - and the “snarl in global markets”. (And for those unfamiliar with “London”, here’s an informative explainer).

But, trying to put patriotism aside there are perhaps, a couple of quick - and perhaps shallow -  reasons why it wouldn’t make much sense to bother with a “NYbor”.

Firstly, it’s all relative. As a benchmark, higher Libor might well be costing some American banks money overall, but it will also be earning other American banks money.

Further, if the average American bank is willing to lend at a level lower than the average European bank, there’s nothing to stop them doing so. Libor is, afterall, a purely indicative measure. But the real issue is perhaps, not about short-term liquidity costs - and with those, systemic risk of overnight insolvencies -  at all. Overnight or short term loans, repos etc. can be made at whatever rate a bank wants. The issue with high Libor seems more like one, then about high funding costs in the fixed-income side of things. Banks don’t like the high funding costs on debt instruments with coupons tied to Libor. That’s not a case for radical change. It’s just grumbling about stumping up the cash. ‘Banks want to pay less interest’ - shock.

Secondly, everything is pegged to Libor. Whatever its failing, it’s a universal standard. The hassle of creating another measure is surely more effort than it’s worth. And if you’re an investor - with, presumably, the upper hand in this market - why would you buy a coupon pegged against unreliable, new-fangled ‘Nybor’, when you could get one pegged against the higher paying, and more tested, Libor?

Back though, to the blame game. Also from the Journal:

Analysts attribute the sharper rise in European banks’ borrowing rates to the fact that they’re scrambling for dollars to pay off dollar-denominated debts.

Dollar-denominated debts? Those wouldn’t be subprime, would they?