Financial sector

[BlasterBates]

So if I get this right the euro bonds that are not much better than junk now leave the uk banking system and get traded on an EU exchange?

On Friday Euro FX clearing and Eurobonds rose 8% in one day.

The entire Euro area bond, interest rate derivative and FX market is worth billions.

You realise it does include all the coporate bonds of most major European companies.

There are approximately 50,000 to 100,000 jobs in this area.

[AtW]

It always was in those currencies. You will find there are more subtle advantages to being here.

City of London is the money laundering capital of the world. Very few questions asked and money leaving London were seen as clean. I don't think it will last now.

[AtW]

Indeed. Until the 60s London was nowhere. New York was king. Then USA introduced large tax rises. Coupled with Eurodollar, London never looked back.

Also, the UK could introduce 10% corporation tax. Boomed......

If Boris does not do it in the next emergency budget then it would cause irreparable harm to future investment.

[AtW]

Yeah exactly, this is what I thought when everyone started bleating about the banks leaving. Can't we just do something like copy the taxes from Luxembourg for example and knock 1% off so companies come here instead?

Luxembourg is in EU, UK is going to leave it, so companies that want to be in EU would not want to be in UK unless the benefit is really big.

[AtW]

Last week German negative interest rate bonds were purchased over British positive rate bonds. Looks like the investors made the right choice. How did they know?

Why buy something nominated in depreciating currency? UK interest rate isn't covering further depreciation risks, nevermind inflation.

[AtW]

I think we are less likely to default on debts when we own our own printing press and if need be can inflate our own debts away while currency devaluation occurs.

That's true, but that also means that people might not be willing to invest into UK bonds because printing presses might devalue their holdings, no point to take that risk.

[DimPrawn]

Aren't these all issues out prime minister should be thinking about......oh wait, we don't have one.

[bobspud]

That's true, but that also means that people might not be willing to invest into UK bonds because printing presses might devalue their holdings, no point to take that risk.

I'd wait and see what state the euro is in soon. Bare in mind 160,000,000 a week is a lot of cash to lose when you have greeces debt problems to fund... Not to mention it's been noted that damage will occur on both sides of this if it's not handled smooth so despite what the Eurocrats want destroying other European economies won't be tolerated which is why you have seen the Germans trying to calm it down and unelected ******* like junkers stirring it up.

[AtW]

I'd wait and see what state the euro is in soon. Bare in mind 160,000,000 a week is a lot of cash to lose when you have greeces debt problems to fund... Not to mention it's been noted that damage will occur on both sides of this if it's not handled smooth so despite what the Eurocrats want destroying other European economies won't be tolerated which is why you have seen the Germans trying to calm it down and unelected ******* like junkers stirring it up.

EU will lose some of UK money, but it will gain a lot more in increased investment - if Scotland leaves and becomes EU states then a lot of City banks will move to Edinburgh.

I can see only one way to reduce loss of big business in this country - make corp tax rate really low, 12.5% like in Ireland or maybe 10%, at least now in theory EU can't stop UK from doing it.

[Rabotnik]

It's not about taxes it's about trading under a financial regulator, i.e. currently a European bank can simply carry out a trade in London, in the future it won't be able to that because trades in London will not have recognised supervision. A huge amount Euro bond trading will have to take place on exchanges in the EU. That is the business that will disappear.

Switzerland, which has no passporting rights exports no financial trading as London does, it's all domestic wealth management of Swiss funds.

Just saw this on BBC about HSBC moving 1000 jobs to Paris due our loss of "passporting": HSBC 'to move jobs to Paris if UK leaves single market' - BBC News